DUSHANBE, April 11, 2013, Asia-Plus — Tajikistan achieved robust growth in 2012, however, the economy is expected to slow down slightly in 2013 and 2014, the Asian Development Bank (ADB) says in a major new report.
According to the report, reforms to improve the business climate, increase foreign investment, reduce excessive reliance on remittances, and achieve energy security are key for more sustainable and inclusive growth.
Released on April 9, ADB”s flagship annual economic publication, Asian Development Outlook 2013 (ADO 2013), forecasts annual gross domestic product (GDP) growth for Tajikistan of 6.5% in 2013, and 6.0% in 2014, slightly below 7.5% in 2012.
“The economy has achieved impressive growth, but remains vulnerable because of heavy reliance on remittances,” said C.C. Yu, ADB’s Country Director for Tajikistan. “More diversified industry and agriculture, and a booming and innovative private sector will result in more sustainable economic growth.”
The report also highlights persistent shortages of electricity in Tajikistan during winter, causing severe blackouts and significant hardship for 70% of the population and most firms outside the capital. These shortages are Tajikistan’s biggest growth constraint, creating economic losses equivalent to 3% of GDP. Improving governance and comprehensive reforms are needed for energy sustainability and independence.
Inflation is forecast to stay relatively moderate at 6.5% in 2013 and 7.0% in 2014. However, it could be higher if food and fuel prices exceed projections, says ADO 2013. In 2012, inflation slowed to 5.8% from 12.1% in 2011.
ADO 2013 includes a comprehensive analysis of macroeconomic issues and examines medium-term prospects in developing Asia, by country and region. Its special theme chapter, Asia’s Energy Challenge, explores how the region can ensure adequate, accessible, clean energy to achieve its growth potential.
Tajikistan joined ADB in 1998, and to date, the institution has approved total assistance of around $970 million in concessional loans, grants and technical assistance to the country. ADB’s operations benefit the population by reducing isolation, increasing communication, broadening access to electricity, improving social services, and creating more income-generating opportunities.
