Kyrgyzstan's parliament has agreed a 2013 budget that envisages a return to robust economic growth after an output collapse this year at the gold mine which is the country's main source of income. The budget, approved by the legislature in a final reading at a late-night session on Thursday, plans a deficit of 16.9 billion soms ($356 million) or 4.7 percent of gross domestic product.

It follows a $7 billion plan announced by the government this month to revitalise the economy in the next five years with help from Russian, Chinese and Western investment and aid. Kyrgyzstan, which hosts both Russian and military air bases, remains volatile after revolts that have deposed two presidents since 2005. Poverty is widespread and the Central Asian nation depends heavily on its Kumtor gold mine operated by Canada's Centerra Gold Inc.

GDP is set to shrink this year after ice movement in the mine and labour protests disrupted output. But the budget assumes the economy, which grew 5.7 percent in 2011, will return to growth at 7.0 percent in 2013, accelerating to 7.6 percent in 2014 and 7.8 percent in 2015. Per capita GDP is about $1,100 a year, less than a tenth of that in neighbouring Kazakhstan. The government targets per capita GDP to rise to about $1,400 in 2013. But GDP fell by 2.4 percent in January-November in year-on-year terms after growing 8.4 percent in the same period of 2011.

Copyright Reuters, 2012