Tajikistan

Politics:

• Analysis

  Tajikistan politics: Quick View - Government extends lease on Russian base

  Event

  The Russian president, Vladimir Putin, has offered economic assistance to Tajikistan's government in return for an extension of the lease on Russia's military base in the country for 30 years, until 2042.

  Analysis

  The deal was signed during an official visit by Mr Putin to Tajikistan earlier in October. The base, just outside the Tajik capital, Dushanbe, is Russia's largest in the country and is home to the 7,000-strong 201st Motorised Rifle Division. Russia is concerned about the possible spillover of conflict from Afghanistan into its own territory following the planned departure of US forces in 2014. This concern is shared by the Tajik government.

  The Tajik government had been angling for a higher fee from Russia for use of the base. Instead, it received promises to allow greater numbers of Tajik migrants to work in Russia-who provide a vital source of income for Tajikistan-and help with military training. At least as importantly, closely following the deal over the base, Russia promised to increase the volume of fuel that it supplies to Tajikistan duty-free.

  This follows the extension of a lease on a Russian base in the Kyrgyz Republic in late September in return for financial help with construction of a crucial hydropower facility. Also, it ties in with Russia's broad strategy of using the reliance of former Soviet countries on Russian energy supplies to entice or cajole them into participating in its plans to recreate international structures across former Soviet space. For example, in recent weeks it has offered both Moldova and Ukraine the possibility of much cheaper gas imports in return for their commitment join to the Russian-led customs union.

  October 15, 2012

• Background

  Tajikistan: Key figures

  Imomali Rahmon

  A kolkhoz (collective farm) leader during the Soviet era from the Kulob region of southern Tajikistan, Mr Rahmon was first appointed head of state in November 1992, when the former communists and their supporters—known as the Popular Front—toppled the short-lived opposition-dominated government that had declared independence from the Soviet Union. Mr Rahmon subsequently won the presidency in three flawed elections in 1994, 1999 and 2006. Despite continued economic hardship for much of the population, Mr Rahmon and his People's Democratic Party (PDP) continue to secure high approval ratings, thanks to their relative success in ensuring improved security in the country. Politically astute and adept at sidelining or co-opting his opponents, Mr Rahmon has gradually consolidated his position. Mr Rahmon has recently changed his name from Rahmonov, in order to de-Russify it.

  Mahmadsaid Ubaidulloyev

  Reappointed as chairman of the National Council (the upper house of parliament) in 2005—a position that he has held since 2000—and mayor of the capital, Dushanbe, Mr Ubaidulloyev is also from the Kulob region. An erratic and unpredictable politician, he served in government in 1992-96 and was then appointed mayor of Dushanbe. As well as occupying a leading position in the political hierarchy, he has extensive business interests. Considered by some to be the second-most powerful man in the country and to have presidential ambitions, Mr Ubaidulloyev also has enemies and, like Mr Rahmon, has survived at least one assassination attempt.

  Muhiddin Kabiri

  Mr Kabiri was elected leader of the Islamic Renaissance Party (IRP) in September 2006, following the death of Sayed Abdullo Nuri. Mr Kabiri is a 40-year-old Yemen- and Moscow-educated scholar, fluent in Tajik, Russian, Arabic and English. He represents a younger generation of Islamic leaders and may, over time, seek to place less emphasis on the party's Islamic roots. However, he could struggle to maintain harmony between the traditionalist and modernising branches of the party.

  The judiciary

  The constitution provides for an independent judiciary, but in practice this is not the case. Judicial appointments, for terms of ten years, to the Supreme Court, the Supreme Economic Court and the Constitutional Court are the prerogative of the president, subject to parliamentary approval. Mr Rahmon has retained wide powers of patronage, enabling him to control government and other political appointments, and contributing to the prevalence of corruption and cronyism. This is particularly widespread within the judiciary, whose independence is further compromised by political pressure.

  The legislature

  Tajikistan's parliament is bicameral, following the introduction of constitutional changes approved in a referendum in 1999. The lower house, the Council of Representatives, comprises 63 deputies elected for a five-year term. The upper house, the National Council, comprises 33 members; 25 of these are elected by local councils, with the remaining eight appointed by the president. In practice political power remains concentrated in the presidency, and the government and parliament to a large extent act as the executors of Mr Rahmon's decisions. Following the 2005 election, the lower house is dominated by the pro-presidential PDP.

  Media services

  The print and broadcast media were heavily curtailed by the state during the civil war, and have been slow to recover. Few independent newspapers, television or radio stations are allowed to operate, with recurring reports of government harassment of journalists. The government frequently denies permission to launch private television and radio stations, although it claimed in 2004 that 26 private television and radio stations were in operation. It has also used its licensing and regulatory powers to ensure the proliferation of pro-government or state-run media in the country. Russian television channels broadcasting from Moscow are widely available. Broadcasting and publishing in the Uzbek language is highly restricted and barely available. There are, in effect, no daily newspapers, although since mid-2001 just over 200 non-daily newspapers and 55 magazines have been registered. Self-censorship is the norm, and there is scant political news or analysis in the available publications. A Tajik-language radio broadcaster, Imruz, was closed down in April 2008 for "technical reasons". Imruz had developed a reputation, previously lacking among Tajik-language media, for critical commentary of the administration and for providing a platform for opposition figures. International media have also faced problems: in January 2006 the government suspended the BBC World Service's FM broadcasting frequency in Tajikistan.

  Democracy index (for methodology, see Appendix)

  The Economist Intelligence Unit's 2008 democracy index ranks Tajikistan 151st out of 167 countries, putting it among the 51 countries considered "authoritarian regimes". This designation includes three other former Soviet states in Central Asia—Kazakhstan, Uzbekistan and Turkmenistan—as well as Tajikistan's neighbours to the south and east, Afghanistan and China. Tajikistan ranks above Uzbekistan and Turkmenistan, but below Kazakhstan, China and Afghanistan. It also fares badly compared with its northern neighbour the Kyrgyz Republic, which alone in Central Asia is classed as a "hybrid regime".

  Tajikistan scores particularly poorly in the "Government functioning" and "Civil liberties" categories. Pervasive corruption, public mistrust of the government and state officials and the rubber-stamp nature of the legislature contribute to the poor score for the Government functioning category. Civil liberties are constrained by a lack of media freedoms, a poorly functioning court system and state interference in religious life. The picture is slightly improved by Tajikistan's higher than average score in the "Political culture" category, which attempts to capture popular attitudes as to the desirability of democratic institutions and practices. Here Tajikistan scores higher than the other four Central Asian states and higher than some Latin American countries with much higher overall scores that are classed as "flawed democracies".

  Democracy index
  	Overall score	Overall rank	Electoral process	Government functioning	Political participation	Political culture	Civil liberties	Regime type
  Tajikistan	2.45	151	1.83	0.79	2.22	6.25	1.18	Authoritarian
  Overall and component scores are on a scale of 0 to 10; overall rank is out of 167 countries.

  Download text file (csv format)

  June 13, 2008

• Structure

  Tajikistan: Political structure

  Official name

  Republic of Tajikistan

  Constitution

  On August 31st 1991 the Soviet Socialist Republic of Tajikistan was renamed the Republic of Tajikistan. On September 9th 1991 it declared itself independent from the Soviet Union. The president's term of office was increased from five to seven years through a constitutional amendment passed in a referendum held on September 26th 1999

  National legislature

  A bicameral parliament consisting of a 63-seat lower house, the Council of Representatives, and a 33-seat upper chamber, the National Council

  Electoral system

  Universal suffrage over the age of 18

  National elections

  November 6th 2006 (presidential); February 28th 2010 (legislative; lower house of parliament). Next presidential election due in November 2013; next legislative election due in February 2015

  Head of state

  The president, Imomali Rahmon (formerly Rahmonov), first elected on November 5th 1994 and re-elected for a third term on November 6th 2006

  National government

  The prime minister is appointed by the president, who is formally head of the executive branch

  Main political parties/factions

  People's Democratic Party (PDP; pro-president); Islamic Renaissance Party (IRP); Democratic Party (DP); Communist Party; Socialist Party; Social Democratic Party (SDP); Agrarian Party; Party of Economic Reforms (PER)

  Leading members of the Council of Ministers

  Prime minister: Aqil Aqilov

  First deputy prime minister: Matlunkhon Davlatov

  Deputy prime ministers:

  Murodali Alimardon

  Ruqiya Qurbanova

  Key ministers

  Agriculture: Qosim Qosimov

  Culture: Mirzoshohrukh Asrori

  Defence: Sherali Khayrulloyev

  Economic development & trade: Sharif Rahimzoda

  Education: Nuriddin Saidov

  Energy & industry: Sherali Gul

  Finance: Safarali Najmuddinov

  Foreign affairs: Hamrokhon Zarifi

  Health: Nusratullo Salimov

  Internal affairs: Ramazon Rahimov

  Justice: Rustam Mengliyev

  Labour & social security: Mahmadamim Mahmadaminov

  Land reclamation & water resources: Saidi Yokubzod

  Transport & communications: Nizom Hakimov

  Chairmen of state committees

  Investment: Davlatali Saidov

  National security: Saymumin Yatimov

  Central bank governor

  Abdujabbor Shirinov

  December 05, 2012

Economy:

• Background

  Tajikistan: Economic background

  Gross domestic product by sector of origin
  (S m unless otherwise indicated; at current prices)
  	2001	2002	2003	2004	2005
  Industry	858	1,117	1,446	1,458	1,638
  % of total	33.5	33.1	30.4	23.6	22.7
  Agriculture	610	750	1,152	1,186	1,527
  % of total	23.8	22.2	24.2	19.2	21.2
  Construction	70	69	137	461	335
  % of total	2.7	2.0	2.9	7.5	4.6
  Trade	269	385	534	993	1,167
  % of total	10.5	11.4	11.2	16.1	16.2
  Transport and communications	128	186	254	409	533
  % of total	5.0	5.5	5.3	6.6	7.4
  Market and non-market services	384	511	704	932	1,127
  % of total	15.0	15.1	14.8	15.1	15.6
  GDP incl others	2,564	3,375	4,762	6,167	7,207
  Source: State Statistical Committee.

  Download text file (csv format)

  Cotton and aluminium production still dominate Tajikistan's economy, although rapid growth in remittances is boosting private consumption and investment, resulting in the small business and services sector making a greater contribution to growth. Cotton output, which collapsed in the 1990s owing to sluggish agricultural sector reform, a lack of investment in irrigation infrastructure and a series of droughts in the latter years of the decade (see Economic performance: Agriculture), remains at less than two-thirds of the pre-independence level. Aluminium is the mainstay of the industrial sector and Tajikistan's principal source of export revenue. Production fell sharply during the civil war but has since recovered, reaching a record 413,800 tonnes in 2006.

  Other sectors are now registering strong growth, including services, light industry and construction. Construction has been boosted by new infrastructure projects and increased demand for Western-standard accommodation and office buildings in the capital, Dushanbe. Private house building is also expanding, financed largely by remittances. Domestic demand growth has been partly fuelled by Tajikistan's role since the mid-1990s as a major transit route in the illegal trafficking of narcotics from Afghanistan, the world's largest producer of opium, to markets in Russia and Europe. Some 90% of seizures of illegal narcotics in Central Asia occur in Tajikistan. The UN estimates that around 100 tonnes of heroin pass through Tajikistan every year, and it is likely that the heroin trade provides a major source of income for the country.

  June 13, 2008

• Structure

  Tajikistan: Economic structure

  Economic structure: Annual indicators

  	2008a	2009a	2010a	2011a	2012b
  GDP at market prices (S bn)	17.7	20.6	24.7	30.1	38.7
  GDP (US$ bn)	5.2	5.0	5.6	6.5	8.1
  Real GDP growth (%)	21.2	3.9	6.4	7.5	6.5
  Consumer price inflation (av; %)	20.4	6.5	6.5	12.4	6.5
  Population (m)	7.4	7.5	7.6	7.8	7.9
  Exports of goods fob (US$ m)	1,575	1,038	1,303	1,739	1,687
  Imports of goods fob (US$ m)	-3,699	-2,770	-2,936	-3,540	-3,912
  Current-account balance (US$ m)	48	-180	-383	-304	-548
  Foreign-exchange reserves excl gold (US$ m)	103.9	174.6	324.2	289.3	416.7
  Exchange rate S:US$ (av)	3.43	4.14	4.38	4.61	4.76
  a Actual. b Economist Intelligence Unit estimates.

  Download the numbers in Excel

  Origins of gross domestic product 2010	% of total	Components of gross domestic product 2009	% of total
  Agriculture	22.8	Private consumption	92.9
  Industry	18.7	Public consumption	28.4
  Services	58.5	Gross fixed investment	17.2
  		Exports of goods & services	13.4
  		Imports of goods & services	56.4
  Principal exports (fob) 2010	% of total	Principal imports (fob) 2010	% of total
  Aluminium	61.5	Petroleum products	16.3
  Cotton fibre	16.7	Alumina	12.0
  Electricity	0.3	Natural gas	1.6
  Other	21.4	Electricity	0.5
  Main destinations of exports 2010	% of total	Main origins of imports 2010	% of total
  China	37.4	Russia	32.2
  Turkey	31.5	Kazakhstan	11.0
  Russia	8.5	China	9.0
  Iran	5.0	Ukraine	7.1
  Afghanistan	4.4	Iran	5.3

  Download the numbers in Excel

  Download text file (csv format)

  December 05, 2012

• Outlook

  Tajikistan: Country outlook

  Tajikistan: Country outlook

  FROM THE ECONOMIST INTELLIGENCE UNIT

  OVERVIEW: Tajikistan will continue to face instability in the 2013-14 forecast period, not least from regional and Islamist groups. Poverty, unemployment, austerity, power shortages and external disruption are possible sources of political destabilisation. In 2013 the administration is likely to prepare the ground for the presidential contest planned for later that year, aiming to keep media outlets and civic groups in line so as to ensure President Imomali Rahmon's re-election. Remarkably strong real GDP growth in 2012 has been driven by industry, remittances and agriculture. The Economist Intelligence Unit estimates economic growth of 6.5% in 2012, with a modest slowdown in 2013 and a slight acceleration in 2014. Average inflation is estimated at 6.5% in 2012. A modest resurgence in demand pressures will see inflation rise in 2013, but falling costs of important commodity imports should bring it down in 2014. We estimate a widening of the current-account deficit in 2012 to just under 7% of GDP, but expect the ratio to come down to just above 5% in the forecast period as external demand and export prices pick up a little.

  DOMESTIC POLITICS: In 2012 Tajikistan saw the most serious outbreak of violence since the end of the civil war, which was formalised in a peace agreement in 1997. In July 2012 up to 60 people were reported killed in clashes between state forces and those loyal to local commanders in the eastern province of Badakhshan, on the Afghan border. In the following month police are reported to have fired on a crowd in the provincial capital who were protesting over the murder of a local leader. These are only the most visible signs that the Mr Rahmon's regime will continue to face bouts of instability in the forecast period-in this case, because of latent ethnic-regional tensions left unresolved from the conflict of the 1990s. Political instability could also come from rising popular discontent, alongside persistent buffeting from more powerful regional states. Discontent could be exacerbated by the impact of fiscal austerity and the perennial problem of power shortages in winter. Public disaffection with the authorities will simmer, and widespread economic hardship will exacerbate social tensions. The lack of channels for the expression of dissent further undermines long-term prospects for stability. Opposition parties continue to be harassed, and state interference in media outlets is widespread. Judicial means are used to exclude parties from political participation. There is a risk that insurgent activity in Afghanistan could spread to Tajikistan. Radical Islamist activity has been increasing, and state actions to counter this have continued apace in 2012. The authorities' attempts to repackage all political dissent as potential extremism are designed to cultivate international support for their repressive actions at home. However, the strengthening of state control over religious practices and the crackdown on signs of Islamist extremism risk boosting support for Islamist movements. Although not our main scenario, an extended economic downturn in Russia could present a grave threat to political and social stability in Tajikistan, undermining the financial inflows that keep many Tajik families afloat, and swelling the ranks of the unemployed. Nonetheless, we expect that Mr Rahmon will remain in power in the forecast period. Sporadic clashes with groups hostile to his regime will probably continue, and the opposition could mount protests. The authorities will deal harshly with any extensive social unrest, and have shown that they are prepared to use military methods if necessary. In 2013 the administration will prepare the ground for the presidential contest planned for later that year, especially by attempting to keep media outlets and civic groups in check so as to ensure Mr Rahmon's victory. Constitutional term limits will be amended or ignored to enable this. There appear to be no significant threats to his rule from within the political establishment, as the opposition has been sidelined. The president has no notable health issues, and has just turned 60. Although his position appears secure, a potential threat would be a deterioration in the security situation to the degree that members of the elite decide that he can no longer control the polity. A parliamentary election is not due until 2015. In any case, the success of opposition parties will be limited by administrative control over the election campaign, a lack of media freedom and irregularities in the vote count. We do not expect any genuine moves towards democratisation during the forecast period.

  INTERNATIONAL RELATIONS: Relations with Uzbekistan will centre on disputes over Tajik plans to expand the country's hydropower sector, which Uzbekistan fears will affect irrigation for its cotton crop. In early 2012 Uzbekistan stepped up its campaign of economic disruption. Tensions emerged again in November when an Uzbek court sentenced three women to 15 years in jail on charges of spying for Tajikistan. The discovery in mid-2012 of significant hydrocarbons potential in Tajikistan, if proven, could add to the irritants between the two countries. It is not in the interest of either Russia or Uzbekistan to allow a destabilisation of Tajikistan, as this could undermine their efforts to counter both drug-trafficking and Islamist infiltration into their own territories. This consideration will place limits on the lengths to which the Uzbek government will go in its attempts to undermine Mr Rahmon's regime. That said, Russia has been more than willing to use its economic hold over Tajikistan to achieve its political goals, routinely employing a mix of threats and offers to do so, especially over the fuel that Tajikistan imports from Russia and the many Tajik citizens who work in Russia. One of Russia's main goals has been to extend military access to Tajik territory over the long term. This was achieved in October with a 30-year extension of the lease on a Russian military base. This could help to stabilise Tajikistan's situation with regard to both Afghanistan and Uzbekistan, making the Uzbek leadership more wary of the embarking on any direct conflict. Other important Russian goals have been to steer Tajikistan into the customs union that it heads and to increase its investment in the Tajik energy sector. The influence of China, which has become a significant lender to Tajikistan and an important trade partner, is growing, signified by its offer of a large loan to members of the Shanghai Co-operation Organisation (SCO)-which includes Tajikistan-in June.

  POLICY TRENDS: In recent years the government has broadly followed the reform prescriptions of the international financial institutions, enabling robust economic growth and macroeconomic stabilisation. However, the country remains dependent on international aid for food supplies, infrastructure repairs and capacity-building, as well as on economic links with Uzbekistan and Russia, with whom its interests do not always coincide. In April 2009 the government reached an agreement with the IMF for a US$116m loan under a three-year Poverty Reduction and Growth Facility, which has since been replaced by an Extended Credit Facility and increased to US$164m. Following the approval of the sixth review in May 2012, the Fund continued to stress fiscal discipline and debt control to cope with external shocks in the short term. The authorities are keen to develop energy resources and infrastructure. However, progress on the largest project, the Roghun hydropower plant, will remain slow. If proven, a much increased estimate for hydrocarbons potential under the Bokhtar production-sharing agreement-announced by Tethys, a Canadian oil and gas exploration firm, in July 2012-will change Tajikistan's growth trajectory fundamentally, as well as its international relations over the longer term. The state budget (which excludes financing for the public investment plan) recorded a small surplus in 2011, of S242m (US$50m), according to the National Bank of Tajikistan (NBT, the central bank), equal to 0.8% of GDP. The 2012 budget targets a deficit of 0.5% of GDP; according to press reports, the outturn is close to this. The 2013 budget was passed in mid-November. It envisages a modest rise in spending, but keeps the deficit target at 0.5% of GDP. Its assumptions for economic growth of 7.4% and inflation of 9% look realistic. In the forecast period, the government revenue will be supported by growth in sales and import taxes and lifted by continued growth in remittance inflows. A risk to revenue is a sharp slowdown in Tajikistan's main economic partners, especially Russia. In mid-February 2012 the refinancing rate was reduced to 9% from 10%, as inflationary pressures continued to abate, and it was cut further in mid-August, to 6.5%, where it remained in late November. The rate on liquidity loans to commercial banks has been raised, and open market operations have been stepped up. Weak institutional capacity and the low capitalisation of the NBT will continue to constrain its conduct of monetary policy.

  ECONOMIC GROWTH: Real GDP growth was 7.4% in 2011, compared with 6.4% in 2010. Strong growth in remittance inflows drove the rise in economic activity, especially in trade and services. However, agricultural output also expanded strongly. Export earnings were held back by stagnation in sales of cotton fibre, and by a drop in production at the state-owned Tajikistan Aluminium Company (Talco). As a result, industrial production slowed. In the first three quarters of 2012 economic activity continued to grow briskly, by 7.5% year on year, according to the central bank, driven by industry, remittances and agriculture. In January-September the cumulative industrial output volume rose by 12% year on year, despite a fall in the global price of aluminium (the leading export), a slowdown in external demand and a high base in the third quarter of 2011. Nevertheless, trends in production of cotton fibre and electricity support the picture of fast-rising industrial activity. Although remittance growth slowed in the second quarter, regional trends suggest that they will have accelerated in the second half. In January-September the value of agricultural output rose by 30% year on year, to S2.2bn, according to the State Statistics Committee (SSC). This appears to reflect a strong performance of the production of raw cotton rather than grain, as wheat imports have grown rapidly in 2012. Growth in export earnings began to slow again in September. We estimate a slowdown in real GDP growth to 6.5% in 2012 (up from 5% previously). In 2013 export prices and demand will remain subdued, and higher inflation could hold back economic growth. In 2014 although the global picture looks a little brighter, the outlook for the economies of Tajikistan's most important economic partners is mixed. Although the Turkish economy should pick up, Chinese growth could weaken. Crucially, solid economic growth in Russia, supported by high oil prices, will sustain the growth of remittances in the forecast period. We forecast a slight slowdown in real GDP growth in 2013, followed by a weak pick-up in 2014. The main risk to economic growth is a worse than expected slowdown in Russia or a marked fall in the rouble, which could damage Russian demand for Tajik goods and, crucially, the pace of remittance growth. Another disruption of gas supplies by Uzbekistan, or the recurrence and spread of the recent violence in the east, would also damage growth prospects.

  EXTERNAL ACCOUNT: In 2011 high global prices for fuel and food, in combination with thriving domestic demand, pushed up import costs, with somoni depreciation contributing to cost growth. The trade deficit for the year widened to around US$1.8bn. This was in part offset by the rapid rise of workers' remittances, which came to US$2.8bn in 2011. We therefore estimate that the current-account deficit narrowed to about US$300m, or just below the equivalent of 5% of GDP. The merchandise trade gap widened in the first three quarters of 2012, reaching US$1.7bn, up from US$1.4bn in January-September 2011, owing to faster growth in import costs than in export earnings. After slowing in the second quarter, remittance growth probably picked up again in the second half, owing to the beneficial impact of rising oil prices on the Russian economy, where large numbers of Tajik migrants work. We estimate a widening of the trade gap to about US$2.2bn, and a rise in the transfers surplus to around US$2bn. As a result, we estimate a widening of the current-account gap to almost US$550m, or 6.7% of GDP. In the forecast period the external deficit should shrink as a share of GDP, but remain large as export growth picks up a little and continuing solid inflows of remittances from Russia accentuate the structural imbalance on the trade balance, linked in part to food and fuel insecurity.

  December 06, 2012

View detailed map

Country Briefing

Total area

143,100 sq km

Population

7.53m (end-2009)

Main towns

Population in '000 (2002)

Dushanbe (capital): 562

Khujand: 149

Kulob: 78

Qurghonteppa: 60

Istaravshan: 51

Khorog: 28

Climate

Continental high mountain

Languages

Tajik, a variant of Persian, is the official language and the one most widely used. Russian is also used, especially in urban areas, and Uzbek is the main language for about 25% of the population. The majority of people in the mountainous Badakhshan province speak distant variants of Tajik, which could be categorised as separate languages. Other languages—such as Kyrgyz, Tatar, Turkmen, Uighur and Korean—are also spoken by their respective minority groups

Weights and measures

Metric system

Currency

The Tajik rouble, introduced in May 1995, was replaced in October 2000 by the somoni (S), at a rate of S1:TR1,000

Time

Five hours ahead of GMT

Fiscal year

Calendar year

Public holidays

January 1st (New Year's Day); February 23rd (Army Day); March 8th (International Women's Day); May 1st (International Labour Day); May 9th (Victory Day); September 9th (Independence Day)

March 20, 2012