Tajikistan economy to grow 6.5% in 2024, 2025 – ADB

DUSHANBE, Tajikistan, April 11. Tajikistan’s
economic growth is projected to decelerate slightly in 2024 and
2025 due to weaker remittances, fiscal space constraints, and
subdued global demand for Tajikistan’s major export commodities,
says the Asian Development Bank (ADB), Trend reports.

The country’s gross domestic product (GDP) is forecast to grow
at 6.5% both this year and next after registering 8.3% growth in
2023, according to the Asian Development Outlook (ADO) April 2024,
the bank’s flagship economic publication released today. GDP growth
in 2023 was driven by surges in agriculture and construction, as
well as strong growth in services.

“Tajikistan faces significant climate challenges and risks that
could lead to irreversible economic, social, and environmental
damage,” said ADB Country Director for Tajikistan Shanny Campbell.
“Developing a green economy is key for the country’s sustainable
growth.”

With a growing population, a shortage of arable land in
Tajikistan has created high dependency on imported food, weakening
food security and increasing the population’s vulnerability to
natural hazards. The country has lost an estimated 20% of its
glaciers in the past 34 years. This poses a major threat to the
economy as the country is heavily dependent on glacier-fed rivers
for hydropower generation.

With ADB’s support, the government has prepared and approved the
Green Economy Development Strategy (GEDS) up to 2027. The strategy
outlines 11 priority areas, including energy efficiency, waste
management systems, and ecotourism. The government is committed to
expanding renewable energy capacity to 10,000 megawatts and
achieving universal green electricity generation and net-zero
emissions by 2037.

ADO April 2024 calls for Tajikistan to adopt climate-friendly
policies and introduce a comprehensive climate fiscal framework to
improve planning, budgeting, and the execution of the policies set
out in the GEDS. The government may also consider updating its
public procurement policies and construction standards by
integrating green economy principles.

In 2024 and 2025, inflation in Tajikistan is projected to reach
5.5% and 6.5%, respectively, but currency interventions will
mitigate the rise and exchange rate volatility. The increase in
inflation is due to anticipated higher lending as deposits
increase; a 40% rise in pensions, stipends, and public sector
salaries which became effective on 1 January 2024; and a 16%
increase in electricity tariffs which also came into being on the
first day of this year.

ADB is committed to achieving a prosperous, inclusive,
resilient, and sustainable Asia and the Pacific, while sustaining
its efforts to eradicate extreme poverty. Established in 1966, it
is owned by 68 members—49 from the region.