Tajikistan has worked out the plan of actions on improvement of the financial situation of the Open Joint-Stock Holding Company (OJSHC) Barqi Tojik for 2019-2025. A report prepared by the Minister of Energy and Water Resources, Usmonali Usmonzoda, for the Government, in particular, notes that 1.2 billion U.S. dollars are needed for implementation of this plant.
According to the report, the money will be spent to make current payments, pay debts to independent electricity producers (Snaguda-1 and Sangtuda-2 hydropower plants), pay commercial debts to local banks (Orienbonk), create the necessary counting infrastructure, restructure and modernize generation and distribution facilities, etc.
The report notes that additional financial resources of Barqi Tojik that are formed as a result of increase in cash receipts and reduction in expenditures could be “the sources of necessary funds for implementation of the plan.”
The company also plans to attract funds from international financial institutions, including the World Bank and the Asian Development Bank, and other partners for development.
The report says 130 million U.S. dollars in loans will be attracted this year from the World Bank for payment of Barqi Tojik’ debts to Orienbonk and Sangtuda-1 and Santuda-2 hydropower plants.
The report also notes that negotiations are being carried out on attracting grant from the World Bank for implementation of the mentioned plan. .
Barqi Tojik’s debts
Barqi Tojik’s debts have reportedly reached 22.9 billion somoni (equivalent to more than 2.4 billion U.S> dollars), including loan investment agreements.
Without taking into account the loan investment agreements, the company’s debts amount to 4.4 billion somoni as of January this year.
As of January 2019, the utility owed more than one billion somoni to the Sangtuda-1 HPP, which is operated by OJSC Sangtudinskaya GES-1. The utility’s tax debts reached 66 million Somoni. Besides, Barqi Tojik owes large sums to OJSC Orienbonk and has debts accrued from purchasing coal and other fuels.
As of January 2019, Barqi Tojik’s debts to the Ministry of Finance on the loan investment projects reportedly amounted to 18.5 billion somoni.
Barqi Tojik, a vertically integrated power utility owned by the Government of Tajikistan, manages the country’s power sector. Hydropower plants generate 98% of the country’s electricity. The biggest HPPs operated by Barqi Tojik are Nurek (3,000 MW), Sangtuda-1 (670 MW), Baipaza (600 MW), Golovnaya(240 MW), Sangtuda-2 (220MW), and Qairoqqum (126 MW).
Barqi Tojik has good technical skill among its staff, but suffers from weak operational and economic management systems and a worsening financial position. This severely impacts its ability to undertake its critical functions of planning, implementing, and supplying good quality reliable power to the consumers of Tajikistan. The ADB review of Barqi Tojik in 2013, conducted under sector operational performance improvement program of the Regional Power Transmission Project, has made assessment of the utility and identified several critical weaknesses. These related to the organizational structure, the financial reporting systems, the accounting and audit systems, the utility’s debts, the metering billing and collections system, commercial and technical losses, business planning process, management information systems, and its human resources management.
