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Economy :
Tajikistan is the poorest
of the five former Soviet Central Asian republics, with an estimated
four-fifths of the population living below the poverty line. Basic
services and infrastructure are poor to non-existent. Although less
than 10 per cent of the country’s land can be cultivated, Tajikistan
has a sizeable agricultural sector accounting for one-quarter of GDP
and employing half the workforce. Large quantities of cotton are
produced under ecologically ruinous schemes established during the
Soviet era. Grain, fruit and vegetables are also grown. In the last
few years, the country has been badly hit by a regional drought, an
earthquake and a series of mudslides (caused by poor land use) which
have forced the Government to make several appeals for international
food aid.
Tajikistan’s economic prospects lie with exploitation of its mineral
resources, which include gold, aluminum, iron, lead, tin and mercury
ores. There are coal deposits as well as small amounts of natural gas,
which together with hydroelectric schemes meet the bulk of the
country’s energy needs. There is little heavy industry other than
mineral processing (mainly aluminum); light industry is concentrated
in food processing and textiles.
The Tajik economy suffered severely during the 1990s from the
dislocations caused by the break-up of the Soviet Union followed by
two outbreaks of civil war. It has recovered slowly since the 1997
peace accord but some positive results are now showing : the
hyper-inflation which blighted the economy during the civil war has
now been cut to around 10 per cent. Annual GDP growth in 2002 was a
healthy 7 per cent.
The Government’s economic reform programme, which is now being
implemented, comprises a typical recipe of privatisation, deregulation
and fiscal reform. Tajikistan secured membership of the IMF and World
Bank in 1993; it also belongs to the European Bank for Reconstruction
and Development as a ‘Country of Operation’. It has received
substantial aid from Middle Eastern donors, including Saudi
Arabia, Kuwait and the Islamic Development Bank. External
donors now supply around 60 per cent of Tajik government income.
Tajikistan now has its own currency, the Somoni, which was introduced
in October 2000 to replace the 5-year-old Tajik rouble. In April 1998,
Tajikistan was admitted to the Customs Union of the Commonwealth of
Independent States, a loose federation of former Soviet republics,
whose members continue to dominate Tajik trade. Further afield, The
Netherlands and the UK are important trading partners. In July 2001,
Tajikistan acquired observer status at the World Trade Organization.
Business :
Tajikistan is looking for foreign investment in
a number of sectors, particularly in aluminum processing, which needs
extensive modernisation. Foreign businesses are not barred from any
economic sphere: although land, livestock and mineral resources are
owned by the Government, it is possible to lease them. Foreign
concerns are allowed to participate in the privatisation programme.
Foreign investments in certain priority areas, which are as yet
undefined, are eligible for tax holidays - including import and export
duties - although, in effect, each foreign investor negotiates his or
her own terms and many are better than the standard laid down in law.
All foreign investors must be registered with the Ministry of External
Economic Affairs. Office hours : Mon-Fri 0800-1700.
Commercial Information :
The
following organizations can offer advice and information : Ministry of
Economy and Trade, 37 Bokhtar Street, Dushanbe, Tajikistan (tel : (372)
215 132 or 210 463; fax : (372) 273 434; e-mail :
minvo@jinter.com) or Ministry of
Industry, 22 Rudaki Street, Dushanbe, Tajikistan (tel : (372) 218 717;
fax : (372) 218 281). Information can also be obtained from the US
Department of Commerce, Business Information Service for the Newly
Independent States, USA Trade Center, Stop R-Binis, Ronald Reagan
Building, 1401 Constitution Avenue, NW, Washington, DC
20230, USA (tel : (202) 482 4655; fax : (202) 482 2293; e-mail :
bisnis@ita.doc.gov; website :
http://www.bisnis.doc.gov). |
