October 2019. Republic of Tajikistan: trends and forecasts

06 December 2019

The growth of the Tajik economy accelerated in the first half of 2019 as households’ consumer activity increased and mining and agricultural output rose. The EDB projects the country’s GDP growth to slow down in 2020 as investment in the energy industry declines somewhat. Later on, economic growth will trend towards its potential rate that we estimate at 7%, the highest level across the EDB Member States.

Inflation accelerated as food prices rose but remains within its current target range established by the National Bank of Tajikistan (7+/-2%). As assessed by the EDB, the weak external inflation background favors a slowdown of consumer price growth in Tajikistan in the second half of 2019, that will remain within its target range of 6+/-2% in 2020.

The refinancing rate of the National Bank of Tajikistan was reduced in the first half of 2019. The regulator believes inflation remains within its target range, and that its acceleration is caused by short-term factors. According to the EDB’s base projection, the inflation slowdown will enable the National Bank to continue to reduce the rate in 2020–2021.

In the first half of 2019 the State budget posted a deficit of 0.2% of GDP after a surplus of 3.0% of GDP a year before. We believe this to be temporary, particularly as the authorities intend to cut the funding of energy construction projects.

Back to the list