A look inside Central Asian Philanthropy

WINGS Interview with Dinara Musabekova

  1. What does philanthropy and charitable giving look like in Central Asia? Who participates in it? (Gender, class, geographic make-up, language, ethnic differences?)

Despite historic, cultural, and religious traditions of charity in the CA region, a contemporary culture of charity is lacking in modern Central Asian states. This situation can be explained by a number of factors, including a lack of public awareness about philanthropy, a lack of public trust in charitable institutions, and a lack of formal incentives, in addition to limited organizational capacity within charitable organizations and a lack of steady programmes to support the institutional development of the charity sector.

Unlike long term philanthropy, charity in CA region is the most popular act of instant relief to mitigate immediate repercussions. Charity commonly occurs in the form of welfare distribution such as the provision of food, shelter, or money. Many individuals, organizations, and companies appreciate the need to advance public goods, but limited public awareness about the root causes of social issues, the work of civil society organizations, and non-financial forms of support confine both the scope and impact of charitable activities.

Since there are virtually no credible data on charitable giving in Central Asia, it is difficult to draw affirmative conclusions. For instance, there is popular discourse that substantial donations are made through religious institutions, but due to the discretionary nature of such giving along with the absence of verifiable data it is nearly impossible to trace its real turnover and substantiate such claims.

  1. Who are the different actors trying to cultivate a culture of giving in Central Asia? How are they doing this?

There is a view though that Central Asian countries have long had their own traditional norms of philanthropy, which can be characterized as community-based philanthropy. The distinctive features of such a model are the predominance of a rural population, traditional norms of philanthropy (kinship, community, and religious formats), active civil society (NGOs), a high level of adaptation of the population to innovations, and relative non-interference of the state into the activities of public organizations.

Religious organizations in Tajikistan play a dominant role through donations during religious holidays. In Kyrgyzstan, most of the donations come from individuals to provide financial and material assistance to sick children, in some cases medium-sized businesses, which conduct various charity events for orphanages and the elderly. In Kazakhstan main part of philanthropy coming from corporations which have a whole of structure and assistance programs and there are also private charity foundations of local oligarchs.

  1. Are there specific nuances on what philanthropy and charitable giving look like between Kazakhstan, Kyrgyzstan, and Tajikistan?

According to the World Giving Index for 2017, Kyrgyzstan and Kazakhstan are consistently the worst performers in Central Asia, ranked 85th and 87th, respectively. For instance, in Kyrgyzstan, only 29% of respondents reported that they donated money to a charity, 46% helped a stranger, and 15% of respondents volunteered time to an organization. Meanwhile, Uzbekistan, Tajikistan, and Turkmenistan are performing much better in comparison to their neighbors (with the respective ranks of 38th, 50th, and 69th).

There are also some differences in charity legislation and incentives. Several prominent voices in Central Asia’s private sector claim that charity is not ‘profitable’, i.e. the perceived costs are greater than the perceived benefits for private businesses. In Kazakhstan, companies may claim tax deductions of up to 4% of the donation. Individuals and companies in Tajikistan who make donations to charity organizations can deduct this amount from their taxable profit – although no more than 10%. In Kyrgyzstan, a charity organization is also subject to tax benefits. Yet, most not-for-profit organizations refrain from seeking to obtain a charitable status, since they will be obliged by law to spend 98% of their income on a charitable purpose or purposes within a year after receiving a donation, and thus leaving only 2% of this income to cover general overhead costs, including the salaries of personnel. In Uzbekistan, on the contrary, philanthropists and charities can claim a tax deduction in the amount equivalent to 75% of the granted sponsorship assistance but no more than 15% of the total amount of the patron’s annual taxable profit during one financial year, or up to 35% of the total amount of taxable profit if the philanthropists’ support qualifies for the ‘national treasure’ of Uzbekistan. In general, however, current tax incentives are still too low to effectively stimulate individual and corporate philanthropy.

  1. What are some key challenges to developing philanthropy in the region?

Lack of credible data on charity, limited incentives for charitable giving, lack of a contemporary culture of charity.

  1. What does the relationship look like between different actors in the region regarding philanthropy and charitable giving (businesses, NGOs, governments, community, citizens, external actors)?

International institutions, corporate sponsors, and individual supporters currently sustain the work of charitable organizations, yet additional structural solutions are needed for long-term sustainability through:

  • Increase public awareness about diverse opportunities to serve those in need the widespread promotion of a broad definition of charity – one which includes non-monetary contributions, such as volunteer time and expert consultancy – will be critical to increasing public awareness and effective engagement from the wider public.
  • Improve the incentive structure for key stakeholder groupsIdentified inconsistencies in the legislation will help harmonise tax legislation and financial/non-financial incentives to encourage business and government to develop of philanthropy in Central Asia. Advocates for increasing the tax deduction for corporations consider a targeted incentives programme for small- and medium-sized businesses, who are wholly absent from national CSR discussions and decision-making processes.
  • Establish diverse pathways for citizen participation in philanthropy – necessary to promote multiple pathways for citizen participation in public, private, and civil sectors. These practical citizen engagement opportunities will provide direct and meaningful entry points for lasting dialogues, debates, decision-making, and problem-solving on philanthropy.
  1. What are some resources people can look into if they are interested in learning further about philanthropy in the region?
  • University of Central Asia – Civil Society Initiative
  • Aga Khan Development Network – Civil Society Monitor
  • Charities Aid Foundation – CAF World Giving Index: A Global View of Giving Trends.
  • International Center for Not-for-Profit Law –  Civic Freedom Monitor: CA countries
  • International Center for Not-for-Profit Law – Philanthropy Law Reports

 


Dinara Circle Picture

 

Dinara Musabekova

Manager

Civil Society Initiative, University of Central Asia

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