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ACHIEVEMENTS’09
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December 2009 Issue #1 www.freemarket.kg
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Promoting ideas
of freedom and
SUCCESSFUL LAUNCH: GOOD responsibility in
Central Asia
OUTREACH IN A SHORT PERIOD
Central Asian Free Market Institute, 14/8 Togolok Moldo, 720017, Bishkek, Kyrgyzstan | office@freemarket.kg
ACHIEVEMENTS ’09! PAGE 2
Central Asian Free Market Institute is an independent analytical center, with a mission to Major Donors:
expand individual freedom and responsibility in Central Asia. We strive to strengthen the ‣ Friedrich Naumann
Foundation
foundation of market economy, sanctity of private of private property and the rule of law.
‣ Atlas Economic Research
Foundation
THE INSTITUTE ACHIEVES ITS ‣ To build relationships with leading think- ‣ Soros-Kyrgyzstan
STRATEGIC GOALS BY: tanks in Europe, Asia and North America Foundation
‣ Actively working with experts to study ‣ To educate young leaders, who will help ‣ International Republican
us disseminate the message of freedom and Institute
economic problems in the region to be used
for making holistic solutions to the country’s apply it ‣ OSI Assistance
legislators Foundation for Tajikistan
GOALS OF CAFMI
‣ To carry out educational events for ‣ To disseminate and advocate for
students, entrepreneurs, politicians and the Date of Registration:
individual freedom
public at large on basic principles of ‣ To disseminate and promote the ideas of ‣ April 6, 2009
freedom and responsibility private property and free markets
Headquarters:
‣ To popularize the idea of limited
CAFMI STRATEGY government, in economic and social terms, ‣ Bishkek, Kyrgyzstan
‣ To form coalitions, of business people, and show the practical benefits of it
experts or organizations, for the detailed through our research Target Audience:
study of concrete problems. ‣ Professional preparation and support for ‣ Researchers and
‣ To disseminate the research findings individuals and organizations who are journalists
among CAFMI’s target groups supporters of individual and economic ‣ Businessmen and
freedom entrepreneurs
‣ Policymakers
‣ Young professionals
Central Asian Free Market Institute, 14/8 Togolok Moldo, 720017, Bishkek, Kyrgyzstan | office@freemarket.kg
ДОСТИЖЕНИЯ ’09! СТР. 3
Central Asian Free Market Institute is headquartered in Bishkek, Kyrgyzstan. Its staff is made up of ‣ Founder:
Mirsulzhan Namazaliev
two people. Interns and help is procured as per needs of projects and work load.
Central Asian Free Market Institute, 14/8 Togolok Moldo, 720017, Bishkek, Kyrgyzstan | office@freemarket.kg
ACHIEVEMENTS ’09! PAGE 4
Reaching peaks of
Central Asia
Learn freedom,
learn english
Experts who gave presentations were Glenn Cripe (USA), Andy Eyschen (Malaysia), Robin
Coerner (U.K.), David Huzelman (U.S.A. ), Pedro Ulteras (Mexico), and Uluk Kydyrbaev and
Seyitbek Usmanov from Kyrgyzstan.
17%
83%
More then 80% of participants would
have paid to attend, according to post-
camp surveys
Project Sponsors: Date and place: Successes:
‣ Friedrich Naumann Foundation September 25-30, 2009, Oru-Say, Bishkek Free market clubs opened in Kyrgyzstan’s
‣ Soros-Kyrgyzstan Foundation Participants: 40 people top universities (AUCA, KRSU)
ACHIEVEMENTS ’09! PAGE 6
RECAMP - NON-CONFERENCE
The event drew experts in the field of economics from Central Asian countries and also from Europe and the
U.S., who gave presentations in the field of economic freedom and its application to the host region.
DONATE | SUPPORT
FINANCING STUDENTS
EDUCATION YOU INVEST IN
THE FUTURE OF FREEDOM
AND THE REGION
40
In some cases fake drugs cause direct harm. Fortunately, no such
cases were registered in Kyrgyzstan yet, but a batch of counterfeit was
30
exported to the US and killed 62 americans in 2008.
Another possible harm from fakes is the presence of insufficient active
20
ingredients to eradicate the microorganisms. The surviving
microorganisms breed, resulting in drug-resistant strains. Hence, the
10
real medicine becomes less effective at treating the disease. This has
0 been a particularly severe problem in treating malaria, for in the 1980s
Russia and 1990s antimalarial drugs such as chloroquine were used
Kazakhstan inappropriately so that parasites became resistant to them.
Uzbekistan
Causes
There is lack of hard data as to the share of the fake drugs on The causes for prevalence of fake medicines are numerous. Some
Kyrgyzstan’s drug market due to lack of such research but a regional suggest that because fakes are more widespread in less developed
comparative analysis suggests it is in the range between 20% and countries; consumers in these countries are less willing to pay for
30%. Furthermore, according to Vladimir Pluzhnik, Director of the quality medicine. While the first part of the claim is true the second part
Center for Protecting Consumer’s Rights “Vigens”, the number of is not. Claiming that poor people are are unwilling to pay for quality
complaints about fake drugs is increasing by the year. medicine implies that the poor are unable to make rational decisions;
hence, are willing to consume harmful medicine, which is a clear logical
According to WHO most faked medicines in developing countries were fallacy.
antibiotics (28%) and hormones and steroids (14%). Rustam
Kurmanov, director of the pharmaceutical supply department at Rather the prevalence of fake medicines in poor countries is best
Kyrgyzstan’s Ministry of Health, concurs that most prevalent fakes are explained by:
antibiotics. Yet, the authors of the research paper admit that most
‣ defective legal systems and
cases of counterfeit drugs are not known to governments since there is
‣ government distortions of the pharmaceutical market
no systematic mechanism for discovering and disclosing them.
The papers authors, Harris, Stevens and Morris are convinced that
while these "measures suggest powerful signals to those involved in
Unfortunately; in many developing countries like Kyrgyzstan it is trading and delivering fake drugs their actual effect may be less
difficult to enforce trademarks. Therefore, the paper finds, “where effective and…even be counterproductive.” Stronger criminal penalties
trademarks cannot be enforced, cheaply produced poor quality copies will likely drive activities further into the hands of organized criminal
will typically crowd out good quality drugs” simply because they are cells. They will also likely result in increased corruption, as criminal
cheaper and it is hard to distinguish quality from fake. The weakness of cells seek to infiltrate law-enforcement agencies. This was the case in
trademark protection means that producers of high quality medicines 1930s with the start of Prohibition in the US and the USSR in 1980s
are unable to protect their brands, which might even deter them from and is the reality in many developing countries like Kyrgyzstan and
entering the market altogether, therefore, leaving consumers no choice Mexico that have outlawed drugs.
fakes.
The fundamental problem is that as long as consumers lack reliable
The other legal failure allowing the existence of fake drugs is the means of ensuring the identity (brand) of the drugs they are purchasing
weakness in civil law. Civil law protects consumers against defective the problem of fake drugs remains. The fundamental problem is in the
goods. It enables the consumer (or their relative) to obtain inability of consumers to identify a drugs identity. Harris, Stevens and
compensation from the manufacture or supplier of a harmful product. Morris recommend measures by the private sector to prevent
This discourages the manufacturer or supplier from producing and counterfeiting as these seem to be most effective in curbing trade in
selling fakes. However; in Kyrgyzstan civil law is poorly defined or fake drugs.
inadequate to be effective. Vladimir Pluzhnik concedes that although it
is possible to take to court the pharmacy that sold the fake drug, the The simple measures undertaken by private initiative already prevail in
legal hurdles are enormous and benefits minimal; therefore, few Kyrgyzstan:
actually do. Actually, no such cases have been registered. ‣ Oddly shaped pill shapes
‣ Tamper-evident packaging
Solution ‣ Holographic images
Kyrgyzstan’s government has adopted policies to tackle the problem of However; even these challenges have been overcome by
fake medicines. On April 27, 2009, Prime Minister Igor Chudinov counterfeiters. Current private efforts focus focus on more complex
signed legislation ratifying Kyrgyzstan’s fight against fake drugs, as systems that are believed to be sufficiently complex to render
part of the Commonwealth of Independent States agreement.The counterfeit activities uneconomical.
Ministry of Health and the State Customs Committee are responsible
for the implementation of the law. continued on next page...
ACHIEVEMENTS ’09! PAGE 11
Kyrgyzstan’s government took laudable steps in 2008 for scrapping Governments have a role to play beyond improving the rule of law.
VAT on imported medicine. This causes the price differential between Many government interventions in the pharmaceutical market have
quality medicines and fakes to diminish and removes opportunities for restricted supplies of quality medicines, driving up prices and simply
fake medicines who don’t bother to pay VAT anyway. Secondary leading to gaps in the market. These have then been exploited by
benefit of minimizing costs of quality drugs is that such tariffs as VAT purveyors of fake medicines. Governments could substantially reduce
and import duties removes extra layers of slow- moving customs these problems by removing impediments to the supply of quality
bureaucracy. This gives customs officials opportunities to solicit bribes medicines, such as taxes, tariffs, price controls and arbitrary
to decide which drugs are help up and which are fast tracked- “a regulations.
situation which favors importers willing to behave illegally,” believe the
papers authors. Central Asian Free Market Institute, September 2009
So, I think the BBC’s Brian Hanrahan speaks for all of us in the
journalism community when, reflecting on the night the Wall fell, he
writes, “For me it was that rare occasion when a story was unqualified
good news. After years watching the way communism was practiced, I Several countries throughout the world have managed to minimize
felt no need to mourn its collapse. Whatever came next had to be governmental paternalism, most notably the United States and Europe.
better”. Their citizens are economically, politically, and mentally free. It’s no
surprise that they score first again and again in global rankings for
Yet, when we look at the everyday realities of our lives here in Central productivity, creativity, and the sciences.
Asia, not to mention North Korea or Cuba, it’s obvious that even if the
Berlin Wall physically fell, it remains spiritually as strong as ever. Here In contrast, too often it seems that the populations of Central Asia
are three examples: continue to lay about, waiting for a Stalin or Putin to lift them from their
morass. Their inertia testifies to a belief that prosperity and freedom
‣ Turkmenistan banned students from attending the American must be things that happen to a society, not things to be worked
University of Central Asia in Bishkek. According to neweurasia, toward.
attempts by the students to find out why were met with accusations of
treason and threats of punishment. The Berlin Wall of the mind is seductive: it promises security and
certainty, but in exchange for real fulfillment. The peoples of Central
‣ Uzbekistan has started erecting a concrete wall along the border with Asia must resist the temptation. We must reject the myth that
Kyrgyzstan. According to Johns Hopkins University’s Central Asia- government control brings more benefits than the private initiatives of
Caucasus Institute, the wall will be five- to seven-meter tall, replete free men and women. The future can be ours — if only we tear down
with a trench. The decision to build the wall was done unilaterally by that wall.
the Uzbek government under the pretext of combating extremism. Mirsulzhan Namazaliev, CAFMI’s director, at neweurasia.net
ACHIEVEMENTS ’09! PAGE 13
Quality indicators:
‣ Diversified funding sources
Sources of funding for 2009
‣ Financial stability at minimal risk Atlas Foundation Friedrich Naumann
‣ Transparent budget for donors, partners
Soros Kyrgyzstan OSI Soros Tajikistan
and staff of CAFMI
IRI Kyrgyzstan
‣ To optimize spending and use donor
funding most wisely
EVENT MANAGEMENT
Education and discussion events have strategic value for CAFMI
because we strive to build a network of youth who would go on to
Events: promote free market principles in Central Asia
‣ English Liberty Camp Beside Free Market School, English Liberty can present their ideas and critical feedback
‣ Free Market School Camp, ReCamp and IdeaNight, we held a and possibly find supporters.
‣ IdeaNight – Informal youth forum string of discussion seminars, reading nights,
‣ ReCamp – [Non]conference on screening of documentary movies on
economic reforms on economic and economics as well as trainings on
social development in Kyrgyzstan professional development for CAFMI staff
‣ Lectures on ‘wheels’ from leading and our volunteers.
international economic experts for
students and young professionals Furthermore, Andrei Illarionov’s speech on
‣ Discussion seminars economic freedom in Russia and in general
‣ Liberty Nights received coverage from local media and drew
‣ Events with our local partners more than 140 people to hear him.
HR - MANAGEMENT
Wisely managing human resources, in particularly our interns, is of highest importance because they
ensure the quality organization of our events and the operational support to the research teams.
CAFMI Team Understanding that our Institute has 2 full- When we organized major events like
‣ 2 staff time staff and four volunteers, we developed ReCamp and IdeaNight, we sought additional
‣ 4 interns a program for effectively managing our volunteers through our partner organizations
human resources. to help us in moderating, registering,
Number of volunteers at peak: navigating and providing technical help.
‣ 45 people The Institute’s staff and volunteers hold
responsibility for specific projects, which Many people help us on a volunteer basis
Payment System: motivates responsibility and success. because they support our mission and
‣ Payment per successful completion of without them many of our events could not
an event Our team’s spheres of work are: program have been possible.
management, accounting, PR-Coordination,
Plans: project coordination and a research assistant. We are planning on further using volunteer
‣ Full-time accountants resources to save on our donors funds,
‣ Full-time project coordinator Among responsibilities of the Institute’s whenever it is feasible.
‣ We are in the process of implementing director are: promotion of the Institute, event
a corporate code for effectively oversight, fundraising and overall
branding the Institute. responsibility for the Institute’s success.
PR - MANAGEMENT
PR Team: Our long-term goal in managing PR is that journalists cover
‣ Sabina Reingold everyday news from the perspective of the Institute, that is free-
‣ Asel Abykeeva markets and individual freedom.
CAFMI is positioning itself as an independent
CAFMI on internet:
analytical and research center (think-tank),
‣ Facebook (540 fans)
whose research and events gain traction with
‣ Twitter (145 followers, following 697)
the population at large.
‣ freemarket.kg (over 1,000 unique
visitors in the last two months)
The Institute adheres to the following PR
strategy:
‣ Building friendly relationships with heads of
news agencies and journalists
‣ To present interesting research on the
Institute’s webpage
‣To take advantage of new-media (blogs,
social networking sites) for achieving our
goals.
2010 PLANS
‣ In 2010 we will carry out 42 events that In 2010 we will put extra emphasis on
will attract 3,000 people conducting research. We will produce 10
‣ In 2010 CAFMI’s representative in Dushanbe original policy papers, 20 analytical
operation and holding events in Tajikistan. articles and also seek extensive coverage
in media.
More then 3,000 people will take part in our events in 2010
‣ Free Market School in Kyrgyzstan (50 people) Furthermore, we will take part in co-organizing events of our partner
‣ Free Market School in Tajikistan (50.) organizations that help us achieve our Institute’s mission.
‣ English Liberty Camp in Kyrgyzstan (40)
‣ Idea Night, (150 x 3= 450) For example, we will continue to support debate
‣ ReCamp (150) tournaments that that will debate topics on free-
‣ Discussion Seminars (20*11=220 people) 3,000 PEOPLE WILL TAKE market and individual freedom, and had more then
‣ Discussion seminars with experts (10*9=90) PART IN OUR PROGRAMS 200 participants. Also, we will support other events
‣ Lectures on wheels (7*150=1,050) IN 2010 that promote the spread of the message of individual
‣ Student conference (300) freedom.
‣ Conference on ‘Free Trade’ and additional seminars
on the theme (350) In 2010 we will help the creation clubs in leading universities of
‣ Discussion seminars across the regions (7x 30=350 ) Kyrgyzstan, Kazakhstan and Tajikistan that promote individual freedom, free
markets and open borders.
Using concrete
We research
examples we The goal of
the benefits
show the this research We track the
of decreasing
consequences is to repercussions
the tax and
of raising understand the of new and
bureaucratic
barriers to benefits of existing
burden on the
trade on canceling of legislation on
economy.
raising visas to economic
Eventually, we
children, Kyrgyzstan and freedom on the
hope to create
providing the Central Asian
an Index of
quality ‘propiska’, a states.
Economic
medicine and soviet relic.
Freedom for
construction
Central Asia.
cost.
ACHIEVEMENTS ’09! PAGE 18
CAFMI’S BOARD OF DIRECTORS
Emil Umetaliev,
Dr. Tom G. Palmer,
President of Kyrgyz Concept. He
Vice-President for International
is a co-founder of the Bishkek
Relations at the Atlas Foundation,
Business Club, one of the largest
director of Cato University and a
business groups in Kyrgyzstan,
Senior Fellow at the Cato
and a member of the Board of
Institute.
Trustees at American University
of Central Asia.
CAFMI STAFF
Asel Abykeeva, administrative
Mirsulzhan Namazaliev, manager. She is finishing up her
founder and director. He is a political degree in Economics at the
economist, a media consultant, and National University of
new media expert, and has successful Kyrgyzstan. She has experience
track record of working at a private in the sphere of finance,
company. communication, journalism in
different companies and
organizations in Kyrgyzstan.
Sabina Reingold,
Gulmira Aidaralieva,
PR-specialist. She is a contributor
program manager. Prior to CAFMI
to regional news sites:
she has worked at Nexi, Clienterra,
freedolina.net and
Center for Analysis of Methods of
neweurasia.net. She is also the
Education and Teaching and Funky
organizer of a poetry group
Bishkek.
Kovcheg and a correspondent for
IWPR.
Kamila Murzaeva, Excerpt from Ayn Rand’s Fountainhead:
project coordinator. She received her - "Do you mean to tell me that you're thinking
Masters at Academy of Management seriously of building that way, when and if you
under President of Kyrgyz Republic. are an architect?"
She organized English Liberty Camp - "Yes."
and Free Market School. - "My dear fellow, who will let you?"
- "That's not the point. The point is, who will
stop me?"