In a report released at a news conference in Dushanbe, the head of the National Bank of Tajikistan (NBT), Jamshed Nourmahmadzoda, revealed on July 24 that the country’s gold-and-currency reserves are now equivalent to 5.2 months of import cover.
“This year, transactions on acquiring precious metals and foreign currencies in domestic and external markets have become more frequent and the country’s gold-and-currency reserves now amount to 5.2 months of import cover,” the NBT head said, noting that it was one of the best performances in recent years.
As of January 1, 2019, Tajikistan’s gold-and-currency reserves were reportedly equivalent to 4.9 months of import cover.
Nourmahmadzoda further added that Tajikistan keeps its gold-and-currency reserves at banks in Switzerland and Germany.
In recent years, the National Bank of Tajikistan has refrained from disclosing the volume of the country’s gold-and currency reserves.
Meanwhile, an average monthly volume of Tajikistan’s imports over the first six months of this year has amounted to 261 million U.S. dollars.
A report by the World Bank, Tajikistan: Heightened Vulnerabilities, Despite Sustained Growth, notes that international reserves held by the National Bank of Tajikistan rose sharply in the first nine months of 2017 to 5.6 months of import cover, but this was largely the result of one-off effects and not indicative of a sustained improvement in economic fundamentals. The surge in reserves came primarily at the cost of debt accumulation, reflecting a US$500 million Eurobond issuance in September.
According to the report, reserves were also supplemented by the acquisition of monetary gold through domestic currency issuances and foreign exchange purchases facilitated by administrative measures. In the medium-term, reserve levels are reportedly expected to gradually moderate as imports recover and construction of the Roghun hydroelectric power plant (HPP) accelerates.
Countries hold foreign-exchange reserves partly to protect themselves against external crises. One common rule of thumb is that reserves that can cover three months' worth of imports are adequate.
According to data from the Ministry of Industry and New Technologies (MoINT), over the first six months of this year, production of gold has increased in the country by 51.4 percent compared to the same period of last year. The ministry, however, refrained from disclosing the actual amount of gold produced in the country over the report period.
