2014年-世界发展银行全球_Tajikistan___Moderated_Growth_Heightened_Risks_32页_1mb

Tajikistan: Moderated Growth, Heightened Risks

Core Content

Tajikistan's economy experienced moderated growth in 2014, with GDP growth slowing from 7.5% in 2013 to 6.7% in the first half of 2014. The slowdown was primarily due to weaker global economic growth, lower export prices for cotton and aluminum, and reduced remittances from Russia. These factors led to a decline in industrial output and slowed domestic demand, particularly in services and housing construction. Despite this, fixed investment saw a strong increase, driven by the launch of the Public Investment Program (PIP).

Main Views

• Economic Growth: Moderated to 6.7% in H1 2014 due to a slowdown in most sectors. Industrial output growth dropped below 3% y/y, while agricultural growth remained at 6%.
• Domestic Demand: Slowed due to declining remittances, which are a major source of income for many households.
• Inflation: Increased to 4.7% in H1 2014, driven by rising food prices and tariff adjustments for utilities. Real wage growth averaged 17% y/y, with the minimum wage rising above the poverty line.
• Poverty Reduction: Tajikistan has made significant progress in reducing monetary poverty, from 96% in 1999 to an estimated 36% in 2013. However, nonmonetary poverty remains high, with 34% of the population classified as multidimensionally poor in 2013.
• Fiscal and External Risks: The fiscal deficit is expected to remain stable in 2014 due to higher-than-expected foreign trade revenues and spending restraint, but the current account deficit is projected to widen to 3.7% of GDP. External shocks, particularly from Russia, pose a significant threat.
• Structural Reforms: Needed to improve growth, job creation, and poverty reduction, especially in financial sector governance and state-owned enterprise (SOE) management.

Key Information

Economic Growth and Domestic Demand

• GDP growth slowed to 6.7% in H1 2014 from 7.5% in 2013.
• Industrial growth dropped from nearly 7% to less than 3% due to lower export prices and reduced production.
• Agricultural growth remained strong at 6% y/y, despite adverse weather conditions.
• Services and other sectors contributed 65.3% of total growth, while agriculture contributed 13.2%.
• Fixed investment rose by 28.4% in H1 2014, reflecting the start of the PIP.

Poverty and the Labor Market

• National poverty rate fell from 96% in 1999 to 36% in 2013.
• Minimum wage tripled in real terms between 2009 and 2014, rising above the poverty line.
• Registered unemployment remained at 2.5% in H1 2014, but hidden unemployment increased slightly.
• Real wage growth averaged 17% in H1 2014, with the highest increases in financial intermediation, trade, transport, education, and health.
• Nonmonetary poverty remains a significant challenge, with 34% of the population classified as multidimensionally poor in 2013.

External Accounts

• Trade deficit widened to $1.85 billion in H1 2014 due to lower exports and higher imports.
• Exports declined by 15% y/y, with aluminum exports dropping by 50% and cotton exports by 46%.
• Imports grew by 24% y/y, driven by capital goods and minerals.
• Top export markets include Russia, Kazakhstan, Turkey, Iran, Switzerland, and Afghanistan, accounting for 88% of total exports.
• Top import markets are Russia, China, and Kazakhstan, accounting for 57% of total imports.
• Logistics performance is weak, with Tajikistan ranked 114th out of 160 countries in the 2014 LPI. Transportation costs are high due to limited infrastructure and tariffs in Uzbekistan.

Inflation

• Consumer price inflation reached 4.7% in H1 2014, up from 1.6% in the same period in 2013.
• Food prices rose sharply, contributing significantly to inflation.
• Utility tariffs were adjusted, further pushing up prices.
• Inflation was previously low due to stable exchange rates and low fuel prices, but this trend is reversing.

Fiscal and Monetary Policies

• The National Bank of Tajikistan (NBT) raised the refinancing rate by 110 basis points to 5.9% in May 2014 to combat inflation.
• Interest rates in the interbank market stood at 14.14% in July 2014, indicating a significant gap between NBT and market rates.
• Monetary policy had limited impact on inflation due to low NBT funding in the banking sector.
• Exchange rate remained stable, with the somoni depreciating by only 4.6% against the dollar compared to other regional currencies.

Financial Sector

• Nonperforming loans (NPLs) increased from 18% in 2012 to 25% by mid-2014, indicating deteriorating asset quality.
• Governance and enforcement of prudential regulations remain major concerns.
• The banking sector is under pressure due to low reserves and limited scope for interventions.

Structural Reforms

• Comprehensive reforms are needed to bolster growth, employment, and poverty reduction.
• Reforms should focus on:
  • Improving the business environment.
  • Enhancing public sector efficiency.
  • Addressing financial sector vulnerabilities.
  • Ensuring proper SOE governance.
• Sector-specific reforms are required in energy, infrastructure, and other public services.
• Support for returning migrants is crucial to absorb them into the local labor market.
• Long-term strategies should include diversification and better integration into global and regional markets.
• Investment in human and institutional capital is essential to boost productivity and create jobs.

Special Topic: 2013 BEEPS for Tajikistan

• The Business Environment and Enterprise Performance Survey (BEEPS) highlights key challenges in the business environment.
• Firms reported issues such as tax collection inefficiencies, high interest rates, and barriers to entry and expansion.
• Tax officials conducted frequent visits, with some firms indicating expectation of informal payments.
• The business environment needs improvement to support private sector growth and reduce reliance on remittances.

Outlook

• GDP growth is expected to ease to 6.5% in 2014 due to external shocks and slower export growth.
• Fiscal deficit is projected to remain unchanged, supported by reforms and higher revenues.
• Current account deficit is expected to widen to 3.7% of GDP.
• Logistics costs and infrastructure limitations hinder export competitiveness.
• Fragile market links and limited economies of scale restrict response to increased demand.
• Prudent macroeconomic policies and structural reforms are necessary to mitigate risks and promote sustainable growth.