DUSHANBE, 30.09.2021 (NIAT Khovar) – World Bank (WB) analysts said that the prospects of Tajikistan’s economic growth are positive. An increase in exports of metals and minerals is possible. This is evidenced by the data cited in the WB report titled “Economy is Recovering, Difficulties Remain.”

WB predicts that Tajikistan’s real gross domestic product (GDP) growth will be 6.0% in 2021 and moderate over the medium term.

However, this projection for GDP growth assumes vaccination coverage of up to 50% of the population by the end of 2022 for low- and middle-income countries, a global easing of pandemic measures and continued growth in economic activity led by China and the US.

The report says that after the economic downturn in 2020, in the first half of 2021, real GDP growth in Tajikistan was 8.7%. Following the outbreak of COVID-19, the socio-economic well-being of the population deteriorated sharply, and at the end of 2020 the country remained far from full recovery. The successful economic recovery was mainly supported by the continued sharp increase in precious metals exports, as well as growth in the private investment and consumption.

“Improvements in the global economy will contribute to the development of international trade and open up opportunities for migrants to travel and work abroad,” WB analysts predict.

Additionally, remittances and foreign investment are forecast to rise, reflecting improved growth prospects in Russia and China.

The recovery of the world market is predicted to cause an increase in the imports of metals and minerals from Tajikistan, the WB report says.

The recovery of China will lead to an increase in foreign investment, primarily in the mining industry.

The inflow of foreign direct investment into the Tajik economy after last year’s decline, increased by 43% in the first half of 2021, the report says.

The authors of the publication emphasize that two-thirds of direct foreign capital that entered the republic this year comes from the mining industry, followed by transport, and construction (6-7%).

In the first half of this year, foreign direct investment growth was recorded at 43.7% — up to $ 118 million.

Generally, in 2007-2020, over $ 10.3 billion was attracted to the Tajik economy from 65 countries, about 30% of which came from China. This was followed by Russia ($ 1.6 billion), the US ($ 703 million), Great Britain ($ 694 million), and Kazakhstan ($ 577 million).

Chinese investments are observed in almost all sectors of the Tajik economy, with priority given to exploration and production of minerals, communication, construction, financial services, electricity, infrastructure, chemical and textile industries, as well as agriculture and agro-processing.

According to the report, the greatest pressure on Tajikistan’s state budget is likely to come from coronavirus-related spending and infrastructure development projects, especially in the energy and transport sectors.

It is reported that the new waves of the pandemic will require subsequent budgetary expenditures to support the health care system and vulnerable populations.

The total revenue of the country’s state budget in 2021 is projected at 27.6 billion somoni, which is 29.8% of GDP.