EDB investment portfolio


6 projects

$51.4 million

0.77% of the total

EFSD investment portfolio


3 projects

$150 million

2.7% of the total

Tajikistan became a full member of Eurasian Development Bank in June 2009. Its contribution to the Bank’s capital is US $500,000.



In Tajikistan, economic growth intensified in the second half of the year on the back of improving investment expectations and prospects for the financing of large infrastructure projects. The weakening of negative trends in countries which serve as a source of remittances from labor migrants has triggered the process of restoring domestic consumer demand. As a result, the slowdown in economic growth observed in the first half of 2017 was more than offset by an acceleration of business activity in the second half of the year. In total for 2017, GDP growth was 7.1% YoY (compared with 6.9% in 2016).

Economic activity in Tajikistan was influenced by the following main factors: 

  • against a background of stabilizing inflation and accelerated growth of nominal wages, real wages growth remained positive throughout 2017. On average, for the first 11 months of 2017, the annual growth rate was 11.4% in real terms. Households received additional support from labor migrants, who began to increase the amount of remittances sent to Tajikistan.
  • the construction sector ceased to be the engine of economic growth in 2017, showing an increase of 4.1% YoY (20.3% YoY in 2016). In part, this is due to the fact that investment activity decreased in the first half of 2017. The main contribution to economic growth was from industry, both exctractive (22.5% in comparison with 2016) and manufacturing (22.7% YoY). The high yield of industrial and food crops not only provided growth in agriculture, but also had a positive impact on growth in a number of manufacturing industries (food and textiles). For the first time in many years, during the 2017-2018 heating season there was no limit on electricity consumption, which partly caused an increase in the amount of electricity generated (16.7% YoY). Accelerating growth in retail trade (6.6% versus 2016) was accompanied by a restored inflow of remittances, which increased by 18.2% YoY in the first nine months of 2017.

In 2017, the output gap is estimated at -0.4%.

Leading indicators signal that, in 1Q 2018, growth of the cyclical component will continue. The restoration of world prices for cotton and aluminum observed during 2017, as well as the positive growth in the nominal volume of imports registered in December 2017 for the first time in three years, suggests that the high level of business activity will continue in the coming months.  


Inflation trends in 2017 were mainly determined by the food component. A limited supply of fruit and vegetables in early 2017 together with the sharp depreciation of the somoni led to an acceleration in food prices from 5.3% per annum in January 2017 to 12.3% YoY in June 2017. In the second half of 2017, the situation in the domestic foreign exchange market stabilized and the increased volume of fruit and vegetables produced in the new season more than offset the effects of the supply shock. As a result, the growth in food prices slowed to 7.5% per annum in December 2017. The low level of inflation for non-food products (4.3% YoY on average for 2017) is partly a consequence of a substitution effect, suggesting pent-up demand by households for non-food items. As a result, in the second half of 2017, annual inflation reached a new range at 7.0% (±3%) and it was 6.7% in December 2017.

External Sector


After six months of accelerated depreciation (11.9% in June 2017 compared to December 2016), the exchange rate stabilized at the level of TJS 8.8 per US dollar and remained at this level during the second half of 2017. In real terms, the effective somoni index depreciated by 10.4% in the first 11 months compared to the beginning of 2017. This depreciation reduced imbalances between external and domestic prices, so it had no significant effect on improving the terms of trade. The growth of exports by 33.8% in 2017, according to customs statistics, was driven most likely by supply factors, namely, growth in production in the mining sector and agriculture, rather than due to better price competitiveness. A positive factor is the slowdown in the rate of decline in imports. In 2016 the volume of nominal imports fell by 11.5% YoY, whereas in 2017 the reduction was 8.5% YoY. Imports of machinery and equipment, vehicles and intermediate goods began to increase in dollar terms in the last months of 2017, reflecting a revival in investment activity.

Fiscal Policy

According to preliminary data, the budget surplus for the first 11 months of 2017 was 0.6% of GDP, whereas a year earlier the state budget was reduced to a deficit of 0.4% of GDP. Budget revenues grew by 9.7% compared to January-November 2016, mainly due to growth in tax revenues of 17.8% YoY. The slowdown in the growth rate of government spending to 6.8% YoY was mainly due to a 14% reduction in public investment in the fuel and energy complex. A year earlier, the volume of investments in this sector grew by 23.2%.

Monetary Policy

The National Bank of Tajikistan raised the refinancing rate on two occasions in 2017, from 11.0% to reach 16.0%. In the second half of 2017, a range was formed around the discrete inflation benchmark: 7% (±3%). The measures taken were a reaction by the monetary authorities to the acceleration of inflation under conditions of increased volatility of exchange rates in the domestic foreign exchange market. By mid-2017, the situation on the foreign exchange market had stabilized, and inflation began to slow. Despite the fact that, by the end of 2017, inflation had fallen to the middle of the new target level, according to National Bank of Tajikistan estimates, inflation risks remain in the medium term. The gradual increase in capital expenditures from the state budget, the emergence of additional production costs for entrepreneurs due to growth of tariffs for services, and the growth of seasonal demand for currency drive the need to maintain moderately stringent monetary conditions.

With the receipt of funds from the placement of Eurobonds, the reserve adequacy indicator rose from 2.6 months of imports at the beginning of 2017 to 5.6 months of imports at the end of September 2017, which is considered the best figure in the history of the National Bank of Tajikistan.

In the financial sector, despite measures taken to revive the banking sector, key indicators are still weak. The share of overdue loans continues to make up one-fifth of the loan portfolio, or half of the portfolio taking into account interbank loans. Against a background of deposit outflows in November 2017 (a decrease of 3.0% compared to the beginning of 2017), the loan portfolio decreased by 11.0% compared to December 2016.

EDB’s investment activities in Tajikistan in 2013-2017 included the following:

  • The Bank supports power projects by providing expert and technical assistance in the development of necessary technical and economic documents, as well as finance for investment projects (subject to EDB’s Environmental and Social Responsibility Policy and international treaties).
  • EDB will help to develop export-orientated sectors, diversify agriculture, improve productiveness, and solve food security issues by providing targeted finance, in particular for the development of vertically integrated agricultural enterprises.
  • Given the importance of transport infrastructure for the country’s economy, the Bank is ready to support projects servicing export and import exchanges and promoting improvements in transport services and logistics, as well as renovations of the transport fleet and key assets.
  • EDB will continue to provide targeted loan facilities to financial institutions to ensure access for finance for SMEs (targeted loans to SMEs, finance for agricultural producers, trade finance, and lease finance under approved programmes).

Dushanbe Representative Office

Aini Street 48, Business Centre «Sozidanie»,Dushanbe, 734024, Republic of Tajikistan