The document summarizes a socio-economic baseline survey conducted for Issyk Kul Region in Kyrgyzstan. The survey aimed to provide a snapshot of current socio-economic conditions to inform mine closure planning, community investments, and other development activities. It covered a range of economic, social, and environmental issues through indicators. The survey established a baseline for measuring Kumtor Gold Company's contributions to sustainable regional development over time. It is intended to be an ongoing, iterative process to continuously improve development outcomes beyond the mine's closure.

1. Socio-Economic
Baseline Survey for
Issyk Kul Region
Presentation, Donor Forum
Bishkek, November 15, 2013
Douglas Grier, Director Sustainable Development, Kumtor

2. 1. Context
2. Purpose of the Baseline Survey, and expected benefits
3. Approach & short overview of issues covered
4. Outlook
CONTENT

3. 1. Context
• Very significant social and economic importance of Kumtor operations, both on a
national and Oblast level. History of Kumtor in corporate social involvement, e.g
community investments
• Limited life time of the mine (2023, 2026). Socio-economic context will be addressed in
mine closure plans
• High and some times conflicting expectations of stakeholders
• Ambition to create a positive impact on livelihoods, and leave a lasting legacy - for
instance related to building up of local capacity, economic diversity and local
ownership that will continue to generate social and economic benefits in the post mine
closure area
• Ongoing challenge to assess the contribution of mining operations to sustainable
development on the level of regions and communities - beyond the larger financial
contributions at the national level (such as taxes and other mandatory payments)
• In order to inform the public debate in a constructive manner and improve coordination
and impact of development activities, Kumtor has embarked on a journey for improved
measurement, communication and management of its various contributions to
sustainable development

4. 2. Purpose
• In 2013 Kumtor commissioned a socioeconomic baseline study of Issyk-
Kul Oblast
• Purpose is to provide a snapshot of socio-economic conditions of Issyk-
Kul Oblast at the current time
• Used to inform:
• Mine closure planning
• Kumtor strategic community investment (SCI)
• Also beneficial for:
• Issyk-Kul Development Fund
• Donor organizations

5. 2. Purpose of the Survey
• To take an initial step in presenting a more complete and comprehensive picture
of current socio-economic trends and development challenges in Issyk Kul
region, and identifying how they link in with the overall context at national level
• The socio-economic baseline study will thus provide the basis for future
measurement of Kumtor’s overall contribution to local, regional and national
development
• Over time, changes can be identified with reference to the socio-economic
conditions identified and described in the survey, and better judgements about
the impacts and results achieved from development interventions and mining
activities should be made possible

6. 2. Purpose
Project Overview
•Creating the
foundation for the
socio-economic
baseline survey
•Understanding the
context:
National and
regional
development
needs,
opportunities,
objectives, plans
and priority
areas
Stakeholder
views
1. Assessing needs
& opportunities
•More complete
picture of the
current socio-
economic status on
national level and
in particular of the
Issyk Kul region
•Basis for future
measurement of
Kumtor’s overall
contribution to
sustainable
development
•Better sharing of
relevant
information and
engagement with
key stakeholders
2. Socio-
economic
baseline survey
3. Evaluating the
economic impact
4. Managing
development
activities
•Indicating whether
change is occurring
•Measuring the
impact of mining
activities with
regard to the
development
needs and
opportunities
identified and
described in the
baseline survey
•Explaining how
results were
achieved
•To identify areas
for improvement
To improve Kumtor’s
current SCI
approach:
 Focus on real
needs and
opportunities
 Building trusted
relationships
 Increasing local
participation and
ownership
 Further
development of
development
partnerships
 On-going
measurement and
monitoring of
activities, and
continuous
improvement

7. 2. Purpose
Ongoing process of improvement
• It is intended that every three years the
situation would be revisited
• This includes a validation whether needs
have changed and whether they should
be reassessed. This will happen through
involvement of and in consultation with
selected stakeholders and more detailed
regional review
• The baseline will be updated with new
information and input as necessary, and
the impact assessment will be adjusted
accordingly
• All this information will also be used in a
continuous cycle to adapt and improve
the approach to development over time
Socio-economic
baseline
Assessing
the needs

8. 3. Approach and Methodology
Issues covered
In consultation with stakeholders and using desk top research (both public domain and statistical
information provided by government agencies), the survey has identified and addressed several
relevant areas for future measurement in the economic, social and environmental space
Examples of areas covered are (non exhaustive list):
• Economic
• National and local context (e.g. GDP, HDI, labour & employment, industrial output and structure) and
economic history
• Agriculture (e.g. livestock, arable farming, crop yield, food security, irrigation)
• FDI and aid
• People and households (e.g. income, consumer prices, employment)
• Enterprises
• Social
• Health facilities, and access to; infant and maternal mortality
• Education, schooling
• Environmental
• Water (access to and cleanliness of water)
• Air (pollution)
• Land (pastures) degradation

9. 3. Approach and Methodology
Structure of survey
• Structure:
• Discussion and analysis of data and conditions, including national overview and
context, and more detailed analysis on Oblast level
• Findings related to challenges and opportunities identified and described
• Interpretation and where feasible first conclusions (high level)

10. 3. Approach and Methodology
• The socio economic status and situation is described and assessed by selected
indicators and information
• As far as possible, indicators have been chosen that are quantifiable, measureable
and comparable (regionally, nationally, internationally)
• However, socio-economic conditions are often difficult to identify and assess, because
they are influenced by perceptions and relate to different views and values from
different stakeholders
• Therefor, the study has identified areas and activities of common interest in
consultation with a number of organisations involved in development activities at
national and regional level, taking into account numerous existing surveys, studies and
statistics
• As far as possible indicators have been chosen that:
• focus on the needs and opportunities related to national and regional sustainable
development,
• provide the basis for subsequent management, monitoring and measuring of activities,
• should help to improve coordination & participation of local people and partners,
• should be replicable by local partners,
• provide an adequate basis for subsequent judgements about the results achieved.

11. 3. Approach and Methodology
Limitations
Limitations are for example (non-exhaustive list):
• Unrealistic expectations that Kumtor can address every issue
• Missing or poor quality data / information – lack of data depth in some areas. Sometimes data available
on village level, sometimes not even on oblast level
• Areas covered by indicators require different analysis (e.g. a ‘problem’ versus a ‘root cause’, short term
versus long term view, cause and effect)
• Definitions of indicators
• Update and measurement protocols
• Limited input from wider stakeholders, for example from communities (so far, this is indirectly covered
through organizations working on the ground, and based on experience from own projects)
• Limited impact and capacity of one organization alone (including Kumtor) to have a major effect on the
overall socioeconomic condition and underlying root causes in Issyk Kul or any other oblast in
Kyrgyzstan. To this end, more cooperation will be required.
Disclaimer: Inclusion or exclusion of any particular information or indicator should not be taken as a commitment or target
setting exercise by Kumtor Gold Company against one or more indicators. In this context please check individual project plans
for specific indicators.

12. 4. Outlook
Ongoing process
• Designed as an on-going process of continuous improvement with a long-term view to
improving socio-economic conditions
• For achieving longer term positive and sustainable outcomes beyond the life of the
mine, the importance of the following should be reminded:
• reducing the dependency on Kumtor as an employer and purchaser of goods and services,
• building capacity in the region and, and
• supporting innovation and developing alternative income opportunities (economic diversity)
• Stakeholders / donor organisations will be invited to comment on the socio-economic
survey and contribute to further improvement and development

13. Contact
Doug Grier
Director,
Sustainable Development
Kumtor Operating Company
Douglas_Grier@kumtor.com