The International Monetary Fund (IMF) recommends that Tajik authorities should take further measures to restore the confidence of depositors in the banking system.

They are also advised to take measures to manage sizable downside risks to the fiscal outlook owing to large public infrastructure projects.

A statement released by an IMF mission on May 29 notes that measures to improve financial sector regulation and supervision are welcome.  However, further measures are needed to restore the confidence of depositors in the banking system.

IMF experts say that the lack of decisive measures to deal with two large problem banks (Tojiksodirotbonk) and Agroinvestbonk – Asia-Plus) has continued to impede efficient intermediation.

According to them, there are sizable downside risks to the fiscal outlook owing to large public infrastructure projects.  Managing these risks reportedly requires significant fiscal consolidation.

The IMF mission notes that public and publicly guaranteed (PPG) debt increased from 42 percent of GDP at end-2016 to about 50 percent of GDP at end-2017

The IMF team says the recently initiated energy sector reform is welcome, but more is needed to strengthen oversight and accountability of large state owned enterprises (SOEs).  The recent decree for the unbundling of energy sector operations into power generation, transmission, and distribution companies can help improve operational efficiency in this sector.  However, lack of management accountability and deficient pricing policies of the large SOEs have contributed to accumulated losses and the potential for contingent fiscal liabilities.

An International Monetary Fund (IMF) mission, led by Ms. Padamja Khandelwal, visited Dushanbe during May 14−23 to conduct discussions on recent macroeconomic developments and the economic outlook.