In the first five years of independence, Kyrgyzstan's economy made more progress in market-oriented reform legislation but less progress in economic growth than the other four Central Asian states. This disparity was largely because Kyrgyzstan lacked the diversified natural resources and processing infrastructure that enable a national economy to survive the shutdown of some sectors by shifting labor and other inputs to new areas of production.

The economic system of Kyrgyzstan is undergoing a slow, painful, and uncertain transition. Once a highly integrated provider of raw materials for the centrally controlled economy of the Soviet Union, the republic's economy is reorienting itself toward processing its own raw materials and producing its own industrial products. During the late 1980s and early 1990s, however, industry accounted for only about one-third of the country's net material product (NMP -- see Glossary) while employing less than one-fifth of the labor force. The primary emphasis of the economy remained agriculture, which accounted for about 40 percent of NMP and officially employed about one-third of the labor force. The transportation and communications sector employed only about 3.2 percent of the labor force in 1991. As in other Soviet republics, the vast majority of workers were employed by the state, while most of the remainder worked on private agricultural plots.

Data as of March 1996