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PRESS RELEASE

World Bank Helps the Tajik Government to Respond to the Global Economic Crisis

June 23, 2010



WASHINGTON, June 23, 2010 – The World Bank’s Board of Executive Directors today approved the US$ 25.4 million Fourth Programmatic Development Policy Grant for the Republic of Tajikistan to help the government mitigate the impact of the global economic slowdown and to help it continue to implement its medium-term reform program.
 
“This budget support grant will enable the government to maintain its health, education, and social protection services,” said Motoo Konishi, World Bank Regional Director for Central Asia. “This is essential to limit the adverse affects of the global financial crisis on the poor and vulnerable.”
 
Tajikistan has been severely affected by the global financial crisis mainly through a sharp decline in remittances which reduced the real income of the population. While the economy is expected to improve in 2010, the public finances remain under pressure due to unanticipated shortfalls in revenue, which is putting pressure on the balance of payments, reserves, the exchange rate, and the current account. At the same time, the need to assist returning migrants and others who have lost their jobs with social services has increased. The grant will help the government to provide essential social services and to sustain its ongoing reform and poverty reduction program by helping to partially fill the unanticipated financing gap created by the global economic crisis.
 
The grant will also help sustain the confidence of investors by supporting policies to promote macroeconomic stability, encourage private investment, and create a professional public service—essential if the economy is to modernize and grow. Specifically, to promote private investment, the grant helps the authorities to reduce the regulatory burden on businesses, strengthen the financial sector, improve incentives for agricultural growth and diversification, and modernize aviation services. To improve the effectiveness of the government, the grant will support measures to improve the delivery of social services, reform the civil service, strengthen public financial management, and promote transparent and efficient operation of state-owned energy utilities.
 
“The new grant will lay the foundation for post-crisis recovery and growth, which are the central element of the recently approved Country Partnership Strategy for the next three years of cooperation between the Government of Tajikistan and the World Bank,” said Chiara Bronchi, World Bank Country Manager for Tajikistan, “These measures will help the country to recover from the current slowdown and to again attain the high growth rates that have been so important in reducing poverty during the past decade.”
 
Tajikistan became a member of the World Bank and the International Development Association in 1993. Since then, 37 projects totaling US$ 529 million have been supported. Currently in Tajikistan there are 19 ongoing World Bank supported 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.

Media Contacts
In Tajikistan
Fakhriniso Kurbonshoeva
Tel : (+992) 372210381
fkurbonshoeva@worldbank.org
In Washington
Elena Karaban
Tel : (202) 473-9277
ekaraban@worldbank.org

PRESS RELEASE NO:
2010/496/ECA

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