The impact of TCX in the Kyrgyz Republic – a case study
The products and services offered by TCX contribute to reducing uncertainty and limiting the impact of currency crises on the real economy. It follows that the impact of TCX is most visible during times of high volatility and uncertainty, as was experienced in the Kyrgyz Republic during the 2014 Russian ruble crisis.
In this light, TCX performed a case study based on its interventions in the Kyrgyz Republic. The study is organized as follows: the first section describes the nature of the financial challenges the Kyrgyz Republic faced. The second section looks at how the Kyrgyz Republic addressed these challenges, and TCX’s contribution to that process. The third section concludes on TCX’s mandate to stimulate commitments to local currency financing.
The case study clearly demonstrates the importance for local entrepreneurs to be protected against macroeconomic risks. These are risks they cannot influence, and which aggravate the unstable nature of frontier economies when not adequately managed. Enterprises financed in local currency benefit the financial system as they represent a better risk. Vice versa, a stronger financial system benefits local entrepreneurs, enabling them to pursue their life’s ambitions in a more stable environment.
Please find the actual case study here.