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Economic development of the Republic of Tajikistan

during the years of independence

Republic of Tajikistan as an independent and democratic state in the international arena has achieved important economic success during 25 years of its independence while re-establishing  diplomatic and trade relations with countries across the world, being involved in international and regional organizations, international financial institutions and establishing the foreign economic policy of the country.

Today, the Republic of Tajikistan has trade and economic relations with more than 120 countries around the globe. Similarly, during this period of time there has been performed a large amount of work for facilitation of the country's integration into such regional organizations and international financial institutions as the Commonwealth of Independent States, Eurasian Economic Union, Shanghai Cooperation Organization, Economic Cooperation Organization, World Bank, International Monetary Fund, European Investment Bank, European Bank for Reconstruction and Development, Asian Development Bank, Islamic Development Bank, Asian Infrastructure Investment Bank and others.

At the same time, on 2 March 2013 Republic Tajikistan became the 159th full-fledged member state of the World Trade Organization. Tajikistan’s membership in this Organization contributes to the further development of multifaceted cooperation with other countries, and promotes industrial development of the country with a view to produce competitive end products, as well as to increase the foreign trade turnover, make export of domestic goods profitable, increase the local entrepreneurs’ level of knowledge and skills and gain the foreign investments.

Over recent years the Government of the Republic of Tajikistan headed by the President of the country has assumed practical measures in order to create the legal base of bilateral economic relations, trade and investment within the country, thus determining the state’s common and priority areas of economic and social policy.

In this regard, additional Laws of the Republic of Tajikistan were adopted to specify the country’s further economic development process and to determine the economic relations system within the country, namely  “On Investments”,  "On Privatization of State Property of the Republic of Tajikistan", "On Production Sharing Agreements", "On Concessions", "On Free Economic Zones", "On Credit History", and "On Public-Private Partnership".

Similarly, during this period of time the Poverty Reduction Strategies for 2007-2009, 2010-2012, Strategy for Improvement of Population Living Standard for the period 2013-2015, National Development Strategy for the period until 2015, State Investment Programs of grants and capital construction for the period 2011-2013, 2012-2014, 2013-2015 have been approved. Being designed for improving the quality of life and public administration system, development of real sectors of the economy, diversification of production, as well as strengthening of the country's export potential, improving the investment climate, business support, social welfare, labor market development and human potential strengthening, these strategic documents were implemented to establish the basis for the sustainable economic development of Tajikistan. Currently, the draft National Development Strategy for the period until 2030 is adopted, which also includes the country's international commitments on Sustainable Development Goals adopted during the 70th Session of the UN General Assembly in September 2015. At the same time, in these strategic documents the Government of the Republic of Tajikistan has defined the national priorities consisting of three strategic goals for sustainable development of the national economy, namely ensuring energy independence, breaking in the communication deadlock and providing food security. 

In addition, Republic of Tajikistan has signed the Agreement on Avoidance of Double Taxation concluded with 25 countries and Agreement on Encouragement and Mutual Protection of Investments concluded with 18 countries across the world purposely to create favorable conditions for trade and economic cooperation and attract foreign investments to the country. 

Energy sector

In the energy sector of the country domestic and foreign companies have completed a large amount of work to explore and develop the oil basins and gas deposits. In particular, with regard to the promotion of drilling, exploration and management of resources, cooperation with 11 foreign and domestic enterprises and companies in 87 hydrocarbon and oil deposits have been established and 12 different enterprises are involved into the coal mining sector.

At the same time, taking into consideration Tajikistan’s rich water resources and its high demand for electricity, hydropower generation and sustainable development of the sector are of the highest national priority. During the years of independence the “Sangtuda-1 HPP, the “Sangtuda-2”HPP, the first phase of the Thermal Power Station2 in Dushanbe with 50 MW capacity have been built and put in commission, which is considered as the country’s major step towards reaching the energy independence.

With a view to build up a unified power system of the country, fully supplying the domestic energy needs and being able to export the electricity abroad, Tajikistan along with building the hydro power plants also pays special attention to construction of the power transmission infrastructure (such as construction of 500 kV “South-North”, 220 kV “Lolazor –Khatlon”, 220 kV Tajikistan- Afghanistan “Sangtuda-Puli Khumri” Transmission Lines).

In general, within referred period of time more than 4200 km of the power transmission lines, including 720 km of the high-voltage power transmission lines above 110 kV were constructed and put in commission in the country.

In 2008 the construction and rehabilitation of the “Rogun” HPP was re-launched. Being funded by the Government of the Republic of Tajikistan, this project is under construction at the moment. It is worth to mention, that having an estimated capacity of 3600MWt the “Rogun” HPP consists of 6 units, each having 600MWt power, 335m dam height, 13.3 km3 reservoir volume with 10.3 km3 profitability volume; annual electricity production is estimated to more than 13.0 billion kW/h, rock-fill dam - 71 million m3 and total amount of concrete is 2.5 million m3.

Industry sector

Today the country’s industrial production list includes more than 1200 items. Since 2007 parallel to re-equipping of the operating enterprises also the process of new enterprises construction has been rallied, thus increasing the number of industrial enterprises by 62%. The number of industrial enterprises, especially in the field of metal processing (10 times), plastic processing (8 times), construction materials (3.5 times), food (3.4 times), jewelry (3 times), clothing (2 times) have significantly increased. During the same period more than 400 food industry enterprises, 130 construction materials enterprises, 50 metal processing enterprises, approximately 50 sewing enterprises and workshops, 15 plastic processing enterprises, 8 spinning enterprises were constructed and put into operation.

Transport sector

During the years of independence, the Kulob - Khorog - Kulma-Qaroqurum main-line highway,  Murghob-Kulma, Shohon- Zigar and Shkev - Zighar road parts have been constructed, the Dushanbe - Kurghonteppa - Kulob, Kurghonteppa - Dusti – Panji Poyon main-line highways have been reconstructed, “Istiqlol", “Shahriston”, “Khatlon” and “Ozodi” tunnels and international bridge over the Panj River also have been got into service.

In general, with the use of budgetary funds and foreign investments attracted, more than 1.6 thousand km of roads, 18 km of tunnels, 250 bridges and 4 km of antiavalanche facilities have been constructed and repaired.

Over these years there has been also completed construction of the  Kurghonteppa - Kulob railway and 4 borderline bridges to Afghanistan over the Panj River. Construction and reconstruction of the Dushanbe – Tursunzoda and Ayni - Panjakent highways are the priority projects that have been implemented and commissioned, and the Kulob - Qal'aikhum part of road still undergoes the construction.  Along with that, on 24 August, 2016 the Dushanbe-Kurghonteppa railway (estimated cost is more than 165 million TJS) was built.

One of the main priorities of the transport sector is to get all the country’s regions interconnected. Moreover, linking Tajikistan to its neighboring countries through the railroads in order to increase the transit potential of the country and get access to the Pakistan and Iran’s seaports in the near future is a need of the moment, too. In this context, the support of the neighboring countries, particularly China, Kyrgyzstan, Afghanistan, Iran and Turkmenistan have been obtained and Trans-Asian railway construction project connecting China-Kyrgyzstan-Tajikistan-Afghanistan-Iran, Russia- Kazakhstan-Kyrgyzstan-Tajikistan and Tajikistan-Afghanistan-Turkmenistan has been developed and integrated into the national programs.

Agriculture sector

As a result of measures undertaken until 2015 with a purpose to ensure the actual development of the agricultural sector, in the last ten years it has increased by almost 2 times and now accounts for an average of 23% of the country's gross domestic product. During the last fifteen years, 42 investment projects which worth more than 3.7 bln. TJS were carried out in the agricultural sector. Currently 9 investment projects priced at 1.5 bln. TJS are being implemented in this field. In recent years the annual growth of the total agricultural production was amounted to the average rate of more than 7% and in 2015 it totaled in 3.2%.

Construction sector

Construction of the administrative, cultural buildings and sport infrastructure which meet the needs of the age in the cities of Kulob, Khujand, Tursunzoda, Danghara, Khorugh, Roshtqal’a, Pançakent and Vanj, beautiful parks and alleys in the cities of Dushanbe, Khujand, Khorugh, Danghara, implementation of the modern architectural concepts and high residential buildings in all the cities and districts across the country testifies that independent Tajikistan is prospering day by day, creating  better working and living conditions for its people.

In recent years not only the major industrial projects implementation with involvement of the direct foreign investments, but also the construction of residential blocks and hotels has been carried out. In this regard, it needs to be mentioned that a number of the five-star hotels with attraction of the foreign investments were constructed and put into operation in Dushanbe, namely the Hyatt Regency Dushanbe Hotel (funded by the Russian Federation investment company “Sozidanie”), the Serena Dushanbe Hotel (built with financial support of the Aga Khan Fund), the Sheraton Dushanbe Hotel (Indian private investments), the Diyori Dushanbe elite residential complex (funded by the State of Qatar).

Year 2014 is considered to be a “building boom” year for Dushanbe, the capital of Tajikistan, as during that period such beautiful architectural complexes as “Kokhi Navruz”, National Library and National Museum (which together with the presidential palace “Qasri Millat”, parks “Boghi Parcham” and “Boghi Rudaki” form a complex of unique architectural beauty), bazaar “Bozori Poytakht”, cascades of the “Qasri Millat” garden and other outstanding architectural monuments have been built.

Key macroeconomic indicators in 2015

In the first half of 2015, the nominal GDP was equal to 19158.7 million TJS (3060.5 million US dollars) showing the growth compared to the same period in 2014 which amounts to 1279.5 million TJS (260 million US dollars). The real GDP growth in 2015 averaged 6.4% decreasing by 0,3 points compared to 2014.  

Foreign trade turnover in 2015 amounted to 4325,5 million U.S. dollars; a decrease over the previous year is by 18.0% or 949,2 million U.S. dollars. In particular, the trade turnover with CIS countries is equal to 47,3%  or 2045,1 million U.S. dollars and with a far abroad countries it is 52,7% or 2280,4 million U.S. dollars. 

The main trading partners of the Republic of Tajikistan on exports in 2015 are the following countries: Turkey-28.7% of the total exports, Switzerland-23.1%, Kazakhstan-16.4%, Iran-6.7%, Russia-6.4 %, Afghanistan-6.3%, China-3.3%, Pakistan-2.6%, Italy-1.2%, Kyrgyzstan-1.1%, Netherlands-1.0%, Uzbekistan-0.7% and others.

Imports of goods are mainly delivered from the following countries: Russia-30.5% of the total imports,  China-22.2%, Kazakhstan-16.2%, Turkey-3.9%, Iran-3.6%, Switzerland and Turkmenistan-3.1%, Lithuania-2.4%, Afghanistan-1.6%, Germany-1.3%, Pakistan and the UAE-1.2%, US and Ukraine-1.1%,                   Belarus-0.9%, Kyrgyzstan-0.7%, Jamaica and Italy-0.6%, India and Latvia-0.5%, Netherlands and France-0.3%, and others.

In the trade transaction sphere increase of exports rate compared to the imports can be observed with Turkey (122,9 million US dollars), Switzerland (100,8 million dollars) and Afghanistan (1.7 million US dollars).



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