Karakol Free Economic Zone

Karakol Free Economic Zone (FEZ Karakol) — Invest in Kyrgyzstan’s Eastern Gateway

 

The Karakol Free Economic Zone (FEZ Karakol) is one of the free economic zones established in the Republic of Kyrgyzstan, aimed at promoting foreign investment, export-oriented production and regional economic development.

Located in the Issyk-Kul region, in the eastern part of Kyrgyzstan near Lake Issyk-Kul and the town of Karakol, this zone enjoys a unique geographic position for both industrial activity and access to regional markets. 

 

Legal Framework & Establishment

FEZ Karakol is regulated under the Law of the Kyrgyz Republic “On Free Economic Zones in the Kyrgyz Republic” and governed by the Government Resolution No. 431 of 1 August 2014 “On Approval of Regulations on Free Economic Zones – Bishkek, Karakol, Leilek, Maimak and Naryn”.

This regulation defines the rights, benefits and procedures applicable to residents of the zone.

 

Location & Strategic Advantages

- The zone is situated in a connectivity-rich location, at the intersection of road, rail and possibly water transport routes near Balykchy and Karakol within the Issyk-Kul region. 

- Proximity to natural resources, the scenic Issyk-Kul lake and existing industrial heritage in Karakol adds to the potential of attracting manufacturing and tourism-related investment. 

 

Investment Incentives & Benefits

Companies established in FEZ Karakol are eligible for a number of investment incentives intended to enhance competitiveness and reduce operational cost:

 

- Exemption from customs duties and import tariffs on raw materials, equipment and goods for production within the zone. 

- Simplified business registration and licensing procedures for foreign investors. 

- The potential for reduced tax burdens and favourable regulatory treatment (specific terms depend on contract with FEZ) – aligning with general benefits offered across Kyrgyz free zones. 

 

Key Focus Industries

FEZ Karakol is suitable for a variety of industrial and export-oriented sectors, including:

 

  • Light manufacturing (textiles, garments)
  • Mechanical and electrical engineering
  • Food processing and agro-industry
  • Logistics, packaging and trade related to the export corridor through Issyk-Kul region. 

 

How to Establish Your Business in FEZ Karakol

 1.Prepare an investment application and business plan indicating intended activities and required land/space.

 2. Conclude a contract for operation in the FEZ with the zone administration.

 3. Register your company entity with the Kyrgyz Ministry of Justice (or relevant body).

 4. Acquire licence for activity and commence operations under FEZ incentives.

 

Why Choose FEZ Karakol?

  • Uniquely positioned in "eastern Kyrgyzstan", offering access to Central Asian and CIS markets.
  • Competitive cost structure compared to more developed zones, with the potential to tap into "tourism support infrastructure" (Issyk-Kul region) and industrial clusters.
  • Investment environment supported by Kyrgyz government frameworks aimed at export promotion and regional development.

 

If you’re considering expanding your manufacturing or export base into Central Asia, FEZ Karakol stands out as a strategic choice. For further information, please contact our consultant.