Sanctions fears as Krygyzstan shutters companies suspected of aiding Russia

Kyrgyzstan has relied heavily on remittances and has been among Central Asia’s poorer economies. After Western sanctions targeted Russia over its 2022 invasion of Ukraine, Kyrgyzstan became a hub for goods routed around embargoes. Exports to Russia rose sharply from 2021 to 2022, including items such as luxury cars and microchips. Some microchips are dual-use, imported as civilian goods and then re-exported to Russia for military applications like missiles and drones. Kyrgyz authorities ordered 50 companies to shut operations for allegedly helping Russia evade sanctions. The move followed an EU embargo on certain electronics to Kyrgyzstan and earlier EU and UK sanctions affecting Kyrgyz banks and officials.

"From 2021 to 2022, the annual value of Kyrgyzstan's exports to Russia leaped from $393m to $1.07bn, including products such as luxury cars and microchips. Some of those products, such as microchips, are known as dual-use, meaning they are imported to third countries like Kyrgyzstan as civilian goods, and then re-exported to Russia, where they may be utilised in military hardware such as missiles and drones."

"But last week, Kyrgyz authorities declared that 50 companies believed to be helping Russia evade sanctions were being forced to shut their operations in the country. This announcement came weeks after the European Union imposed an embargo on certain electronic goods to Kyrgyzstan for rerouting such products to Russia. It is the first time the Central Asian nation has made such a move."

"Last year, the EU blacklisted two Kyrgyz banks while the United Kingdom imposed sanctions on senior Kyrgyz officials. It's an open secret in Kyrgyzstan that entrepreneurs and companies are benefitting from international and Western sanctions on Russia by helping Russia circumvent them, Erica Marat, a Kyrgyz scholar at the College of International Security Affairs, told Al Jazeera."

"I know some individuals who even though they disagree and are horrified with what Russia is doing in Ukraine still trade with Russia, seeing it as an opportunity, saying that if they're not going to do it, there will be others who will So with the shutdown of the com"

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