Tajikistan

As well as for the whole world, the consequences of climate change are to some extent already noticeable in Tajikistan. In order to build a full-fledged strategy for adaptation to climate change as soon as possible, it is necessary to develop environmental education. This notion is followed by the article by independent researcher Abdukodiri Khurshed for CABAR.asia.

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CABAR.asia 18.02.21

Tajikistan requested 2 million doses of vaccine from the British-Swedish company AstraZeneca under the international COVAX mechanism. According to the interim forecast, published in early February, Tajikistan will receive 732 thousand doses of the AstraZeneca/Oxford vaccine in the first half of 2021. The Ministry of Health of Tajikistan did not specify yet when the vaccination will begin, but it is already clear who will be vaccinated first.
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CABAR.asia 17.02.21

Why does Tajikistan increase its debt and how will the republic cover it? (more…)

CABAR.asia 12.02.21

On January 1, 2021, the Law “On Compulsory Civil Liability Insurance for Vehicle Owners” came into force in Tajikistan. This decision was made after it became clear that the government decree on compulsory insurance did not meet current requirements.
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In Tajikistan, it is necessary to criminalize domestic violence in order to more effectively deal with rapists, says Shokhsanam Shodieva, a member of the CABAR .asia School of Analytics.

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CABAR.asia 05.02.21

On January 16, the legislative amendments to the Tax Code were adopted in Tajikistan, according to which all digital services in the country are now subject to Value Added Tax (VAT) at the rate of 18%. Similar amendments are discussed or are already introduced in other Central Asian countries. (more…)

The project “World Air Quality Index” by World’s Air Pollution  has ranked Dushanbe among cities with the most polluted and hazardous air. The organization’s report was based on data collected from an air monitor located at the US Embassy in Dushanbe.

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Yoqub Halimov 28.01.21

A journalistic investigation by CABAR.asia reveals that the company responsible for the mandatory vehicle inspection does not actually conduct any inspection and simply collects money for a formal procedure. (more…)

Muslimbek Buriev 27.01.21

Tajik authorities continues to introduce new types of taxes and duties. This is happening despite the year-long reform of the tax code. However, this is only part of the bigger picture, on which an independent researcher, Muslimbek Buriev, elaborates in an article for CABAR.Asia.

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CABAR.asia 26.01.21

Tajikistan is asking creditors to defer debt payments and simultaneously is applying for the new loans. Experts doubt that the authorities will be able to find sources to repay loans.


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Ismoil Somoni Monument in Dushanbe. Photo: asiaplustj

Tajikistan is unable to pay off its external debt due to the deteriorating economic situation in the country after the coronavirus outbreak in 2020 and the decline in migrant remittances.

Davlatali Said. Photo: Asia Plus

First Deputy Prime Minister of Tajikistan Davlatali Said wrote in his address to the Asian Development Bank (ADB) that due to the coronavirus pandemic, the Tajik economy is in a ‘force majeure’ situation and the country needs assistance.

Tajikistan’s request to defer external debts appeared amid reports that the government plans to borrow another $562 million from foreign countries and organisations in 2021; partially, the loan will be allocated for Rogun Hydropower Plant construction.

The World Bank December Update stated that Tajikistan has a high risk of debt distress. The World Bank believes that “any new non-concessional borrowing adds to the pressure on public debt sustainability”.

The World Bank reported that Tajikistan joined the group of countries that recently applied to the G20 Debt Service Suspension Initiative (DSSI) created to help developing countries.

“The DSSI’s objective is to support low-income countries by suspending official bilateral debt servicing through mid-2021,” the World Bank Update notes.

According to the World Bank, by now, only China agreed to Tajikistan’s request to defer the external debt payment until mid-2021.

After the World Bank Update publication, on January 19, the Ministry of Finance of Tajikistan issued a statement – it commented the undisclosed media’s publications about Tajikistan being on the verge of default.

“The main goal of the Republic of Tajikistan joining this initiative is to mitigate the consequences of the crisis by concentrating public expenditures on countering COVID-19 pandemic, and not relieving the debt burden on the country’s financial situation, as those published articles claimed,” the Ministry of Finance stated.

The Ministry of Finance assured that “the funds freed up after suspension of external debt servicing were allocated to the country’s healthcare sector”.

As part of this initiative, on September 3, 2020, Tajikistan signed a corresponding memorandum with the Paris Club.

“As a result, the parties came to the agreement to suspend payments on debt obligations to China’s Export-Import Bank (Eximbank) and Kuwait Fund for Arab Economic Development for $43 million and the German KfW Development Bank for €363 thousand,” the statement said.

According to the Ministry of Finance, as of October 1, 2020, the total amount of Tajikistan’s external debt is $3 billion 163.2 million, or 36.9% of the country’s GDP. $149.2 million was allocated to servicing the country’s external debt for 9 months of the last year.

At the same time, according to the global analytical organisation Transparency International, corruption is widespread in Tajikistan. According to the 2019 ranking, Tajikistan ranks 153 out of 180 countries by corruption level. The disproportionate wealth and large foreign assets of Tajik officials are highlighted in a number of studies and investigations by international think tanks and media. The Organized Crime and Corruption Reporting Project (OCCRP) published the latest investigation on this topic in June 2018.

Another major problem associated with the scarcity of the state budget is smuggling. Various reports and studies on Tajikistan also mention it.

The experts say the coronavirus pandemic is not over yet, and it is unlikely that Tajikistan will be able to pay off its foreign debt in the second half of 2021.

Abdumannon Sheraliev. Photo from personal Facebook page

Economic expert Abdumannon Sheraliev said that after the second half of 2021, Tajikistan is unlikely to be able to pay off its external debt. According to him, the impact of the pandemic on the economy will continue at least until the middle of this year, when the economic crisis will reach its peak.

“The chances of repaying loans are very low not only in the first half of the year, but even in the second. The only way is to use gold (gold reserve), but considering the rate at which the government spends it on domestic needs, the prospects for debt repayment are very remote,” said the Tajik expert.

According to Sheraliev, the external debt’s growth will lead to default on credit.

“This means that in the near future, most financial institutions and countries, except for China, will not provide loans to Tajikistan,” Sheraliev said.

With the external debt’s growth from year to year, the country’s budget expenditures on interest payments and the loan amount increase. In particular, in 2021, Tajikistan will spend $213.5 million from its budget to pay off the external debt and interest, in 2022 – $238.2 million, and in 2023 – $243.3 million.

Khojimuhammad Umarov. Photo: CABAR.asia

According to Doctor of Economics Khojimuhammad Umarov, the government’s plans to pay off external debt after the first half of 2021 are too optimistic and difficult to implement.

“The Tajik government should work on the strategy in case if these plans fail,” Umarov said.

He believes that Tajikistan can start paying off the loans no earlier than in the second half of 2021.

Can China Cooperate?

The main Tajikistan’s creditors are the government and banks of China, which account for half of the country’s external debt. Kyrgyzstan, a neighbouring state with Tajikistan, announced fundraising from citizens to pay off its external debt. However, this initiative did not find support and raised the criticism against corrupt officials and irresponsible authorities’ actions, which caused a sharp increase in external debt.

In exchange for repayment of debts, China may demand taking control of deposits of gold or other minerals from Tajikistan

Rising debt to China increases the risk of country’s dependence, raising concerns among Tajik civil society activists. They believe that China, in exchange for repayments of debts, may demand taking control of deposits of gold or other minerals from Tajikistan.

Firuz Saidov. Photo from personal Facebook page

Tajik economist Firuz Saidov believes that considering the political motivation, China can play along with Dushanbe’s plans, and either prolong the loan payments or discharge part of the debts.

“Excessive debt makes the country more dependent on the creditor state. This is part of the strategy of relations between the states: the way they cooperate and, most importantly, from whom they take loans,” added Saidov.

Zulfikor Ismoiliyon. Photo from personal Facebook page

Economic observer Zulfikor Ismoiliyon says the only way to pay off Tajikistan’s external debt is to borrow from China again and pay other creditors.

“China realizes that Tajikistan will not be able to repay the debt, therefore, in exchange for the debt payments, the provision of the precious metals mines or part of Tajikistan’s territory will be required,” Ismoiliyon said.

According to him, the country needs to become independent of the migrant funds and develop its own economy in order to pay off external debts.

“Tajikistan is living off the migrants’ remittances for more than twenty years. Migrants cannot send money today. As a result, people do not know how to earn for a living,” concluded the Tajik economist.


This article was prepared as part of the Giving Voice, Driving Change – from the Borderland to the Steppes Project implemented with financial support from the Norwegian Foreign Ministry. The opinions expressed in the article do not reflect the position of the editorial or donor.