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Speeches & Transcripts April 29, 2021

Opening Remarks: Online Conference on Digital Economy in Tajikistan

Today’s online conference on the Digital Economy could not have been organised at a more opportune moment in time. 

The impressive interest we are witnessing is just a mere reflection of the anticipation and hope that digital transformation will do exactly that, viz., to propel the country from its position of geographic periphery to the virtual centre of emerging, private sector-led activities. 

Today’s discussion benefits from the increasing sincerity to find a way to respond effectively to the four overarching development challenges spanning legacy issues, demographics, climate change, and the COVID-19 pandemic. 

We are seeing encouraging signals of political willingness to translate the combination of increasing constraints and opportunities into sources of development and future prosperity. 

These efforts stand on the two pillars of “green recovery” (largely related to the generation and transmission of clean electricity) and the creation of a “partnership with the private sector”. 

Regarding the latter, reflecting an increased focus on the business climate (starting with the ongoing efforts on tax reforms) and on pre-conditions to create high-quality employment opportunities in the rural, remote regions of the country, where about 70 percent of population live and work, the two key sectors with the highest potential are (i) agriculture, storage, food processing, food safety, exports, possibly with a link to tourism; and (ii) digital transformation, and here with a view to increasing the quality of public service delivery and crowding in private-sector activities.

To be able to “leapfrog” into a digital future, the focus would have to be on the institutional and infrastructure environment that would help to improve tangibly the reliance and speed of the internet, and reduce considerably clients’ costs for access to the internet. 

Global experiences in the current COVID-19 context have shown that affordable, high speed internet plays a critical role in preventing service interruptions that otherwise could contribute to welfare, revenue, and employment losses. 

Governments and businesses across the globe have negotiated virtually, and have had online seminars as we do today, while families have been benefitting from access to online education and e-health services.

Tajikistan has already seen the benefits of an advanced ICT industry. 

During 2000-15, it was one of the country’s fastest growing sectors, contributing to socio-economic development and, indirectly, to state budget revenues.

Through transparent licensing procedures and low licensing fees, Tajikistan translated effectively its economy’s relative weakness — low penetration rates— into an ability to attract reputable international operators. 

In early 2015, the telecom regulator reported ICT revenue growth rates of close to 15 percent. 

Since then, however, gross revenues in the ICT sector have started to fall gradually, with the number of new subscribers having begun to decelerate.

This has affected the present situation. 

Today, Tajikistan is still constrained by limited access to, and high prices for, internet services, especially in rural areas. 

In 2019, far less than one in a hundred households had broadband internet access (primarily in urban areas), and only 35 percent had mobile internet access.

Similarly, only a handful of enterprises have broadband access and fewer than one percent offer digital services. This limited use of the internet has hindered economic development, including the transformation of the country’s industrial sectors. 

The situation is aggravated by high prices for international connectivity, the high cost of public services, limited local connections, and weak content development.

This explains the necessary focus on a regulatory environment and the required level playing field in the market, currently still dominated by a state-owned telecom company, with a policy recommendation to separate the telecom regulator from the operator. 

By removing entry barriers and implementing a modern regulatory framework, Tajikistan could attract more private investment — thereby creating a virtuous cycle as newly established, profitable private enterprises would co-finance the deployment of broadband infrastructure and improved network capacity, including last-mile investments.

That is, to a large extent, the hope and vision of the potential that is inherent in the prospect of digital transformation and the significance of today’s virtual seminar.

With that, I wish all of us a most successful and impactful virtual seminar, as demonstration effect of the potential inherent in a truly digital economy.