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Economic development of the Republic of Tajikistan


Key macroeconomic indicators in 2012

GDP is 36,161.1 mln.TJS (107.5% compared to 2011)

2011 годом) GDP per capita is 4.6 thousand TJS (118.6% compared to 2011)

The volume of industrial goods is 9797.5 mln.TJS (110.4% compared to 2011)

Agricultural output is 16,477.5 mln.TJS (110.4% compared to 2011)

Amount of paid services is 8954.2 mln.TJS (115.3% compared to 2011)

Inflation in the consumer sector is 5.8% (compared to 2011)

Foreign trade turnover is 5,137.6 million U.S. dollars (115.1% compared to 2011)

  • CIS countries is 2310.9 million U.S. dollars (114.6% compared to 2011)

  • Non-CIS countries is 2826.7 million U.S. dollars (115.5% compared to 2011)

Export is 1359.4 million U.S. dollars (108.1% compared to 2011)

Import is 3778.2 million U.S. dollars (117.8% compared to 2011)

 

Today the Republic of Tajikistan is an active, recognized and respected member of the international community and takes its rightful place in the modern civilized world, maintaining fruitful cooperation both at the regional and international levels.

During the 20 years of independence the main achievements in the field of foreign policy was the fact that the Republic of Tajikistan has been recognized as an independent and democratic country in the world community; diplomatic and trade relations with other countries were founded and developed, as well as membership in international and regional organizations. Today the Republic of Tajikistan has trade relations with more than 100 countries, and these relations are enhanced from year to year.Since independence, the policy of the Government of the Republic of Tajikistan has been aimed at developing economic relations, rehabilitation of infrastructure, attraction of investments, and creation of conditions for free trade, reduction of tariff barriers and removal of barriers in foreign trade, to support entrepreneurship, problem solving on transit roads and tunnels to support and develop trade in Tajikistan. In the context of market globalization and interconnectedness of the economies of all countries of the world, the development of international economic organizations and associations, no one country can stand alone. Under these conditions, the Eurasian Economic Community (EurAsEC), the Shanghai Cooperation Organization (SCO) and the Economic Cooperation Organization (ECO) facilitated the integration processes of the Republic of Tajikistan in the regional and global contexts.

On March 2, 2013 the Republic of Tajikistan became the 159th member of the World Trade Organization. So, Tajikistan completed the process of joining all the authoritative international organizations. Membership of Tajikistan in the affluent organization will give a serious impetus to the production of finished, having high quality, meeting international standards and competitive products, and will also contribute to the growth of foreign trade turnover, production profitability of domestic goods of export destination, increase knowledge and skills of local entrepreneurs and increased foreign investment

Tajikistan relations with international financial institutions, namely the World Bank, the International Monetary Fund, the European Bank for Reconstruction and Development, Asian Development Bank, the Islamic Development Bank and a number of foundations and organizations in different countries have been developing in a very fruitful and successful cooperation.

Tajikistan with its policy position of "open doors" expressed its willingness to develop and improve the productive relations with the countries of East and West, and the Islamic world.In order to attract more investment from countries such as Russia, China, the USA, Europe, the Islamic world and other countries, our country is taking steps to develop strong relationships at bilateral and multilateral levels based on economic pragmatism and mutual understanding.

During 22 years of its independence the policy of the Government of the Republic of Tajikistan in foreign relations was aimed at creating a favorable climate for investments, progressive liberalization of trade, reduction of tariffs and elimination of non-tariff barriers in foreign trade, trade promotion, removal obstacles to transport and transit of goods with continuously development of trade processes.

Over this period the Government of the Republic of Tajikistan, led by President of the Republic of Tajikistan, adopted a number of key strategic documents that outline the main priorities and socio-economic policy of the republic. Срединих, Among them are the Poverty Reduction Strategy for 2007-2009 and for 2010-2012; Strategy for improvement of population living standard in the Republic of Tajikistan for the period 2013-2015; the National Development Strategy of the Republic of Tajikistan for the period until 2015; State Investment Programs of grants and capital construction for in 2011 - 2013, 2012-2014, 2013-2015.

These documents have a strategic objective of improving the level and quality of life through sustainable economic development, diversification of production, export building capacity of the state, improvement of the investment climate, support for entrepreneurship, and social protection of the population, labor market development and human capacity building.

As a result of measures taken by the Government of the Republic of Tajikistan to stabilize macroeconomic indicators, inflation and the difference in exchange rates decreased. Since 1997, the GDP growth has been provided.Successive economic reforms, the development of new areas of the economy, implementation of strategic and program goals and objectives, measures to ensure macro-economic stability would provide significant economic growth of the country since 2000. Within the period of 2000-2005 the annual GDP growth rate was 9.4 percent; inflation fell to 7.1 percent; the external debt which in 2000 was 108 percent of GDP fell to 38.9 percent in 2005.

 

Key macroeconomic indicators as of 2007-2012

 

2007

2008

2009

2010

2011

2012

GDP (mln.somoni)

12804,4

17706,9

20628,5

24704,7

30069,3

36161,1

GDP (growth %)

107,8

107,9

103,9

106,5

107,4

107,5

Inflation ( %)

21,5

20,4

6,4

6,5

12,5

5,8

Foreign trade turnover

4015,3

4681,3

3579,9

3853,1

4443,3

5134,6

Export

1468,1

1408,7

1010,3

1195,3

1256,9

1359,4

Import

2547,2

3272,6

2569,6

2657,8

3186,4

3778,2

 

High growth of economic recovery, achieving macroeconomic stability in five years from 1999 to 2003 reduced poverty from 81 per cent in 1999 to 64 percent in 2003.
Despite the negative impact of the global economic and financial crisis and other existing difficulties, for the last 7 years the Government of Tajikistan could ensure the implementation of the approved programs and the gradual development of the national economy. Gross domestic product grew by 9.3 billion TJS from of 2006 to 36.2 billion TJS in 2012; its annual real growth rate averaged 7%, which indicates the sustainable development of the economy. At this stage, the GDP per capita increased from 1335 to 4580 Somoni, or by 3.4 times. Income increased by 4.2 times, the amount of deposits – by 4.5 times the real average earnings per worker –by 5.5 times. Total revenue and expenditure of the state budget for the last 7 years has increased from 1.7 billion TJS to 12.2 billion TJS in 2013 that is seven times as much compared to 2006.
 The analysis shows that if the ratio of state budget revenues relative to GDP in 2000 was equal to 12.6%, while the rate in 2006 reached 19.4% and in the current year will reach 22%. Simultaneously with the increase in the state budget,  funding for social spheres increases, and this year it is 6.4 billion Somoni, or more than half of the state budget.
 If in 2006 the total cost of social spheres was 903 million Somoni, the figure in 2013 is 7 times as much than in 2006. Funding for education increased by 6.7 times, public health services – by 8.6 times, social protection of the population –by 6.8 times, culture, sports and public services – by 7.1 times. If the total expenditure in the social sectors in 2000 was 106 million Somoni, then this year it has increased by 60 times.
The average wages of public sector employees, scholarships, financial assistance and benefits on average also increased from 2006 to 2012 by 6 times. In 2012 wages of employees of social institutions, including salaries of pre-school and educational institutions, homes for the elderly and handicapped children were increased by more than 60%; in the health sector - by 40%, in the science sector - by 30% and in the sector of culture, as well as scholarships - by 50%. In addition, from 2006 to 2013 the size of pension funding was increased by 4.5 times; its volume of 212 million TJS reached 1.6 billion TJS, that is increase by 7.5 times. This policy will be continued in the future
 As a result of these measures, the level of poverty in the country has decreased from 81% in 1999 to 38%, which is almost by 45%. Poverty reduction is mainly a result of economic development and macroeconomic and social stability.

 

Review of foreign trade turnover for 2012



In the reference year the GDP amounted to 36.2 billion TJS; its real growth reached 7.5%.
GDP growth rate

Its increase was mainly observed in the sphere of retail trade turnover –19.6% and paid services – 15.3%; agricultural production and industry –10.4%; and reduce in the sphere of construction by 24.4%.
In 2012 the growth of industrial production was mainly due to oil production – by 1.7 times; leather products – by 49.4%; rubber and plastics products – by 43.5%; textile and garment production – by 28.7%; paper production, publishing and printing activity – by 28.5%; wood processing and the production of wood ware - by 23.8%; chemicals - by 9.4%; production of non-energy materials – by 23.7%; mining of energy-related materials – by 26.9% and food products – by 5.4%.
Growth in agricultural production was formed due to the growth of major products of plant growing, such as fruits –19.4%, potatoes –14.8%, cereals – 12.2%, melons –9.9%, vegetables – 8.1% and grapes – 8.0%. An increase in the production of certain types of animal products such as eggs –by 14.5%, animal and poultry meat – by 7.5% and milk production –by 11.8%.
According to the Ministry of Finance, on the basis of 2012 the budget execution made 101.7%  or 9.6 billion TJS. Total expenditure of the state budget for the period totaled 9.1 billion Somoni, compared to the previous year, is by 5.9% more.
The total amount of paid services rendered to population was 8.9 billion Somoni, of which 15.1% accounts the public sector and 84.9%  – for private sector enterprises. The largest share of household services accounted for 40.4%; 22.7% – for passenger transport; 13.8% – for communication; education – 8.1%; medical services – 2.7% and other paid services –12.3%.
GDP per capita by the end of 2012 amounted to almost 4.6 thousand Somoni or by more than 18.6% if compared with the previous year.
Foreign trade turnover in 2012 amounted to 5.1 billion U.S. dollars; an increase over the previous year is by 15.1%. In particular, the trade turnover with CIS countries increased by 14.6% and with non-CIS countries – by 15.5%.
Trade balance in the reporting year was negative; its deficit is $2.4 billion. U.S.; by more than 24.1 if compared with the previous year. This change was due to lower export prices in global markets and rising prices for imported goods, especially food products, combustible materials and capital goods.
Exports of goods in the reporting year was being steadilydeveloped and it amounted to 1.4 billion dollars. U.S.;  by more than 8.1% if compared with the previous year. Its growth in volumes was mainly due to increase in exports of vehicles (100.9%), of mineral products (100.3%), precious metals (58.7%), textile products (11.6%), and stone products (9.1%), which was associated with an increase in their demand in world markets.



Export data by countries




Exports are mainly delivered from the following countries: Turkey – 36.6% (493.3mln.USD), Afghanistan – 14.1% (192.2 mln. USD), China – 13.3% (181,0 mln.USD), Russia – 7.9% (106.8 mln. USD), Kazakhstan – 7.5% (101.5 mln.USD), Switzerland – 6.7% (90.5 mln.USD), Iran – 4.9% (66 mln.USD), Pakistan – 1.9% (26.5 mln.USD), Latvia – 1.5% (20.5 mln. USD) and others – 5.9%.
Imports of goods in the reporting year amounted to 3.8 billion USD, by 17.8% more than in the previous year. Growth was mainly due to the increase of import of vehicles – by 2.3 times, plant products – by 35.8%, base metals and articles thereof – 30.5%, wood and woodwork – 18.0%, finished food products – 9.3% and mineral products – 4.9%.




     
Imports of goods are mainly delivered from the following countries: Russia – 25.4% (960.6 mln.USD), Kazakhstan – 16.0% (604.2 mln.USD), China – 12.9% (181.0 mln.USD), the United States – 5.1% (193.9 mln.USD), Turkmenistan – 4.1% (154.8 mln.USD), Iran – 4.0 % (151.4 mln.USD), Lithuania – 3.8% (143.2 mln.USD), Turkey – 2.8% (107.1 mln.USD) and others – 26% (982.2 mln.USD).
The official exchange rate of the national currency during the year had a stable tendency to change; with respect to the U.S. dollar fell to 4.7585 TJS in the early period up 4.7644 TJS at the end of the period, or by 0.1%.