DUSHANBE, March 17, 2008, Asia-Plus — A request by two banks – open joint-stock company (OJSC) Agroinvestbonk and OJSC Orienbonk – for postponement of the state loan repayments demonstrates weakness of banking system in Tajikistan, Director of the Center for Strategic Studies Suhrob Sharipov said in an interview with Asia-Plus.
According to him, such statements scare people away from banks. “Trust of population in banks has increased; however, people do not yet dare to keep their money in banks,” said Sharipov, “Our banks’ management leaves much to be desired and their analysis, monitoring and prognosis systems are undeveloped.”
However, he considers that the government should meet the request by the banks, because they are backbone financial institutions of the country. “There are some serious reasons for supporting the banks, including those connected with the global financial crisis,” said Tajik pundit, “The government has opportunities to support the banks, but the government should do that under the terms of purchasing shares from the banks or increasing its ownership interest in them.”
In the meantime, the head of Tajik think tank is concerned over the possibility of recurrence of history with futures companies, when cotton farmers’ debts to investors had reached millions of dollars. “Banks should not relax. Nothing should be forgiven and everything should be repaid,” said Sharipov, “The government should think over real mechanism of bankruptcy. We should have normal market mechanism.”
Asked why the new cotton sector financing mechanism had not yielded expected results, the expert said that it was impossible to change the situation in one year. “”it is to be noted that there is a positive tendency; some 30-40 percent of farming units have managed to repay loans. However, as a matter of fact, the new financing mechanism has changed a few things – just mediators [futures companies] have been removed, while a few has changed for farming units in practice,” said Sharipov, “Banks should help them improve management practices. It is necessary to hire professionals, fund seminars and train farmers in marketing basics, inform them of changes in the food markets, etc.”
