Republic of Tajikistan. Recent social and economic trends and short-term prospective. April 2019

27 January 2020

In 2018, Tajikistan's economy grew by 7.3% amid slowing inflation. The key drivers of growth were public capital spending aimed at the implementation of key public investment projects, in particular, the construction of the Rogun HPP. High share of imported goods in those investments reflected in deterioration of the balance of payments. The dynamics of inflation was mainly influenced by non-monetary factors, in particular, a good harvest and the resumption of trade with Uzbekistan. In the coming years, Tajikistan’s economic growth is expected to remain at comfortable levels supported by consumption and investment. Despite some improvements, the banking sector remains the main source of risk for financial stability. The widening of public deficit and significant quasi-fiscal operations pose risks to the debt sustainability of the economy.