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Republic of Tajikistan

Republic of Tajikistan became a full-fledged member of the Eurasian Development Bank in June 2006. Agriculture, cotton production inclusive, consumer goods production industry, aluminum and hydraulic power production are systemically important for Tajikistan. Tajikistan’s hydraulic power industry has one of the biggest potentials. Money transfers of labor migrants working primarily in CIS states remain a very important factor of Tajikistan economy growth.

Economic situation

In 2015, the economy growth rate was 6%, an average between forecasts by international and national agencies. The industrial sector, in particular metal production (+31.5% year-on-year) and minerals (+38.1% year-on-year) contributed to this growth significantly. Besides the traditionally high contribution from agriculture, GDP was also supported by state-run construction projects in infrastructure, communications, production and electric power transmission. At the same time, with the significant decline in money remittances (according to the Bank of Russia, net money remittances from Russia to Tajikistan was 68.6% lower in 2015 than in 2014), the services sector (-7.1% as against +1% in 2014) and retailing (+5.5% compared to 6.5% in 2014) demonstrated a slowdown, which was especially strong in the second half of the year. 

The declining money remittances exerted pressure on the exchange rate: the somoni depreciated vis-a-vis the US dollar in both real (-4.6%) and nominal (-20%) terms. Despite significant foreign exchange rate fluctuations and weaker foreign and domestic demand, the foreign trade deficit decreased significantly (-32.4% of GDP compared to -36.4% of GDP in 2014). This was associated with a relatively insignificant reduction in exports (in particular, the export of mineral products fell by 10.1% and non-precious metals and metal products by 4.5%) and a noticeable decline in imports (the import of oil products and vehicles, which are among the largest groups of imported commodities, went down by 31.9% and 54.2% respectively). 

The government budget, without taking into account the government investment programme, had a surplus of 0.8% of GDP in 2015 and a deficit of 2.7% in Q4. Despite reductions in foreign trade revenues, non-tax and other revenues helped to raise the total government budget incomes to 33.2% of GDP. Among expenditure (besides current expenses) the priorities in 2015 and in the next years are government investments in the power and transport sector aimed at enhancing domestic energy potential and expanding transport communications.

Inflation decreased to 5% as at mid-year and remained at that level until December 2015. This was ensured, to a certain extent, by the lowering prices of food and oil products in global markets as well as currency interventions on the part of the National Bank. Foreign exchange rate fluctuations and the growing devaluation expectations resulted in higher price growth and increased deposit dollarisation at commercial banks. As a result, commercial banks curtailed lending in the national and foreign currencies. Because of changes in the foreign exchange rate the demand for loans went down by 1.7% year-on-year as at December 2015. At the same time, statistics suggest that the quality of commercial banks' loan portfolio has worsened significantly: the ratio of classified loans to the total was 37.8% as at end-December 2015, compared to 22.6% at year-beginning.


EDB’s priorities in Tajikistan

In the framework of its investment activities in 2013–2017:

 EDB is prepared to continue supporting projects in the power generation sector by: providing expertise and technical assistance to develop the required technical and engineering documentation; and subsequently participating in investment project financing (taking into account EDB’s Policy of Environmental and Social Responsibility and international agreements).

 EDB will: provide assistance in developing export-oriented enterprises; facilitate agriculture diversification and productivity improvement; and participate in addressing the issues of food security by providing targeted financing, inter alia to develop vertically integrated agro-industrial enterprises.

 Taking into account the importance of the transport infrastructure for the country’s economy, EDB stands ready to support projects aiming at: servicing foreign trade; improving the quality of transport services and logistics; and the renewal of vehicles and fixed assets.


     

 

EDB Member States

  • Russian Federation

    Russian
    Federation

  • Republic of Kazakhstan

    Republic
    of Kazakhstan

  • Republic of Armenia

    Republic
    of Armenia

  • Republic of Tajikistan

    Republic
    of Tajikistan

  • Republic of Belarus

    Republic
    of Belarus

  • Kyrgyz Republic

    Kyrgyz
    Republic