WASHINGTON, June 30, 2022 – The World Bank’s Board of Executive Directors approved $80 million as Additional Financing to the Power Utility Financial Recovery Project in Tajikistan. The original project, approved in 2020, aims to improve the long-term sustainability of Tajikistan’s energy sector by increasing financial viability, improving reliability of electricity supply and contributing to better governance of the country’s power utility structure.
“We are committed to continuing our support to Tajikistan’s energy sector by promoting reforms and supporting improvement of operational efficiency, supply reliability, financial viability, governance, and transparency of electricity sector,” said Ozan Sevimli, World Bank Country Manager in Tajikistan. “The overall goal of our investments is to ensure that revenues from sales of clean, renewable energy domestically and from exports continue to be reinvested in adequate and reliable electricity supply for households, businesses, schools and hospitals, contributing to economic growth, poverty reduction and development of human capital.”
The Power Utility Financial Recovery Project was developed in support of the Program for Financial Recovery of Barqi Tojik Open Joint Stock Holding Company, BT (2019-2025), adopted by the Government of Tajikistan to improve financial viability of utility company and increase reliability of electricity supply. The World Bank support of this Program includes financing of activities in three areas: (i) financial viability of electricity sector; (ii) adequacy of electricity supply and its reliability; and (iii) good governance and transparency. The specific activities under the World Bank-financed project include the rehabilitation and upgrade of key electricity transmission, achievement of cost-recovery tariffs, restructuring of loans between BT and Ministry of Finance, improvement of investment planning, implementation of cost-saving measures in the electricity sector including BT, integrating sound governance practices and transparency in the operations and financial management of the company.
The Additional Financing by the World Bank approved today provides additional support to the above activities and aims to support Tajikistan in ensuring that its planned program of critical reforms in energy sector is implemented in spite of the challenging environment. In addition to supporting Tajikistan in achieving financial sustainability in the electricity sector, supply reliability, and strengthening sector governance, these efforts will also set the stage for improving the environment for private investments in the longer-term.
The World Bank is using a financial instrument called “Program-for-Results” (PforR) for this Program, which links disbursement of funds directly to the achievement of specific outcomes.
Tajikistan’s energy sector has been a priority area of engagement for the World Bank. Its current investments in this sector stand at $562 million to support the sector’s financial and operational sustainability, ensuring provision of affordable and stable electricity supply to families and businesses domestically and generation of much needed revenues from increased export of clean, non-fossil energy resources.
Currently, the World Bank is financing 25 projects in Tajikistan totaling at $1.39 billion. Since 1996, the World Bank has provided over $2.44 billion in IDA grants, highly concessional credits, and trust funds for Tajikistan.
