The process of selling government bonds of the first issue has been completed in Tajikistan, an official source within the Securities and Special registration Agency of the Ministry of Finance (MoF), told Asia-Plus in an interview Thursday afternoon.
“All issued bonds have been sold. The second and subsequent issues of government bonds will be carried out according to schedule,” the source said, noting that government bond issuance volumes are expected to grow in the future.
The total volume of the first issue has reportedly amounted to 100 million somonis (more than 8.1 million US dollars).
The face value of one government bond is 1000 somonis.
According to the period of circulation, government bonds are divided into 3 types: 1) government bonds with circulation period of 6 months with annual return of 8%; 2) government bonds with circulation of 12 months with annual return of 10%; and 3) government bonds with circulation of 24 months with annual return of 12%.
It is noted that accounting and storage of government bonds are carried out in the Closed Joint-Stock Company (CJSC) Central Securities Depositary, where each issue was assigned an international identification code ISIN
An International Securities Identification Number (ISIN) is a 12-character alphanumeric code that serves for uniform identification of a security through normalization of the assigned National Number, where one exists, at trading and settlement.
Investments in government bonds reportedly have a high level of reliability, which makes them one of the most attractive financial market instruments.
“Anyone can buy government bonds, including foreign investors who can buy them through direct participants in government bond trading,” the source said.
Recall, a symbolic launch of trading in government securities took place at Hyatt Regency Dushanbe on January 17. The debut Ring the Bell trading was officially opened by Presidential Aide for Economic Issues Nematullo Hikmatullozoda, Finance Minister Faiziddin Qahhorzoda and the Asian Development Bank (ADB) Country Director for Tajikistan Shanny Campbell.
Within the framework of the public finance management project, the ADB provides financial support for the organization of the secondary securities market in the country.
Speaking at the event, Hikmatullozoda noted that issuance of government securities is one of the most economically feasible methods of financing the budget deficit.
Besides, the issuance of such securities can help smooth out unevenness of tax revenues, eliminating the cause of cash budget imbalance.
The government securities can be used to finance programs implemented by government bodies, the presidential aide emphasized.
The minister of finance noted that the issue of these securities was carried out in order to ensure to socioeconomic development of the country and implementation of the National Development Strategy of Tajikistan for the period up to 2030.
At the end of the event, Amonatbonk (Tajikistan’s savings bank) and Sanoatsodirotbonk (industry & export bank) were awarded licenses of a professional participant in the securities market.
Presentation of the first issue of government securities on the country’s organized market took place in Dushanbe on January 9. The event participants (Roadshow) were familiarized with the terms of issue and placement of government bonds of the Republic of Tajikistan.
One of the meeting participants, who wanted to remain unnamed, told Asia-Plus that the presented government bonds are planned to be sold both to legal (commercial banks, companies and other organizations) and physical entities.
The money collected is expected go to the budget to finance important industries and sectors.
The MoF press center says the secondary market for sale of securities is expected to be established in Tajikistan. The secondary market is where investors buy and sell securities from other investors.
As it was reported on January 30, the CJSC International Bank of Tajikistan (IBT) is the first financial institution to purchase the MoF bonds. The bank has reportedly purchased the MoF bonds in the amount of 30 million somonis. The International Bank of Tajikistan has also become the first financial institution to purchase the government bonds on the Central Asian Stock Exchange (CASE).
