Economic growth but a weak external position
Overview:
The Tajik economy has managed to maintain solid economic growth throughout the global financial crisis. A sharp slowdown in industrial output, exports and worker remittances was offset by strong agricultural output and investment spending. Despite this, the current account deficit remains high and foreign exchange reserves low even after the devaluation of the currency. Against this backdrop, the authorities are trying to increase energy security by aiming to complete the construction of a massive hydro-power plant. While much of the financing for this project has been secured, the authorities still have a difficult path to tread. They are trying to implement their investment plans and increase social spending on the poor without allowing an unsustainable rise in the public debt to GDP ratio.