WASHINGTON, May 25, 2010 – The World Bank Group Board of Directors today discussed a new Country Partnership Strategy (CPS) for Tajikistan, which provides the framework for the World Bank Group's assistance to Tajikistan for 2010-2013.
The main objectives of the new CPS, prepared at a time when Tajikistan is addressing the impacts of the global economic crisis, are to reduce the negative impact of the crisis on the poor and vulnerable and to pave the way for sustainable and inclusive growth post-crisis. The new strategy is grounded on a broad and continuous dialogue with the Government of Tajikistan and all of the development partners.
Tajikistan achieved strong economic growth between 2000-2008, with an average annual growth rate of 8.6 percent and visible improvements in people’s living standards. However, a sharp recession in Russia triggered a substantial drop in remittances to Tajikistan which, combined with a decline in the country’s main export commodities, has put at risk the gains of the past several years. Tajikistan’s already low social and economic indicators have been hit hard by the compound effects of the food, energy, and financial crises.
"Tajikistan faces tremendous challenges of protecting its population from impacts of the global crisis and laying the ground for the post-crisis recovery," – said Motoo Konishi, World Bank Regional Director for Central Asia. "To help the country achieve these goals, the World Bank is continuing its program in Tajikistan through both financial and analytical services. Our program has been designed to support the country’s development agenda and priorities, including improving public administration, developing the private sector and attracting investment, and enhancing human potential."
To unleash the potential of assets such as land, water, hydropower, and human capital, Tajikistan will need to mitigate the effects of the crisis while working to build capacity towards post-crisis recovery and sustained development. The new CPS envisages World Bank Group financing of about US$ 140 million over the next four years through the International Development Association (IDA) and about US$ 62 million to be attracted through trust funds.
Addressing the near-term challenges posed by the crisis will require sound macroeconomic management, including efforts to protect spending on priority social services. Over the medium-term, successful post-crisis recovery will depend on enhancing the productivity of the country’s physical and human assets. Key initiatives will include strengthening the business environment and access to finance; boosting agricultural productivity; improving the reliability of electricity and water supply; expanding the country’s energy production and export potential; and enhancing human capital through higher-quality education and health services. Based on the lessons of the last Country Assistance Strategy progress report, the World Bank Group will selectively use a variety of instruments to support the priority areas identified in the new CPS. These will include investment operations, budget support, and analytical work.
One of the crosscutting themes in the new strategy is governance. The Bank has been working with Tajik authorities to strengthen public financial management and public sector performance by undertaking review of the administration and delivery of social services, supporting civil service reforms, and promoting new procurement law. However, the government’s effectiveness needs to be further improved and transparency and accountability strengthened.
"The governance agenda cuts across the entire CPS program, and the Bank will engage in helping the Government improve its effectiveness on various levels – country, sector and individual projects," – said Chiara Bronchi, World Bank Country Manager for Tajikistan. "The World Bank Group's governance interventions will take three forms: transparency and accountability measures, capacity development, and supporting demand for good governance."
The CPS supports the government in developing hydropower in a responsible way to secure the country's energy supply and gradually generate electricity export revenues. The Bank is supporting the preparation of comprehensive techno-economical, social and environmental impact assessments of the proposed Rogun hydropower project, taking into consideration the interests of all the riparian countries.
Tajikistan's Development Results
- The implementation of the CPS 2006-2009 has achieved definite progress in the introduction of per-capita financing in primary health care: the per capita financing system has been designed and piloted.
- School attendance and completion rates are up in areas of the Bank project implementation and the bases have been set for improving the quality of the service. Progress in implementing education per capita financing nationwide has exceeded expectations.
- The Doing Business 2010 report released in September 2009 ranked Tajikistan 152 out of the 183 economies measured by the Doing Businessindicators. For the first time, Tajikistan was among the top 10 global reformers who made doing business easier. Between June 2008 and June 2009, Tajikistan reformed in five of the 10 areas measured by the report: starting a business, dealing with construction permits, getting credit, protecting investors and closing a business.
- Structural reforms have been undertaken in areas such as agriculture, energy, transport, and private and financial sector development.
- Partial improvements in safe water availability in Dushanbe have taken place.
- The quasi-fiscal deficit of the energy sector has been reduced.
- The Community Agriculture and Watershed Management Project in Tajikistan and the Food Crisis Response projects were awarded in the World Bank's third annual "Improving the Lives of People in Europe and Central Asia 2010" competition.
Tajikistan became a member of the World Bank and the International Development Association in 1993. Since then, 36 projects totaling US$ 505 million have been supported. Currently in Tajikistan there are 18 ongoing projects in health, education, agriculture, water and energy, municipal infrastructure, and public sector management that are helping Tajikistan’s poorest to weather the financial crisis and pave the way for sustainable economic development.