Tajikistan Development Forum

Opening statement by Xiaoyu Zhao, ADB Vice President, at the Tajikistan Development Forum, Dushanbe, Tajikistan

Your Excellency President Rahmon, Your Excellency Prime Minister, Distinguished Vice Prime Ministers, Ministers, Ambassadors, Heads of Delegations, Ladies and Gentlemen

On behalf of the Asian Development Bank (ADB), I would like to express our sincere appreciation to the leadership of Tajikistan for organizing this important Development Forum and inviting us to participate. We appreciate the broad-based participation by the development community, including non-traditional partners. We are also pleased by the breadth and depth of the cooperation between the Government of Tajikistan and the Donor Coordination Council in preparing the agenda and presentations for the Forum.

Tajikistan has experienced robust economic growth accompanied by significant poverty reduction. This continued through the second half of 2008 and the onset of the global economic downturn. Certainly, the crisis did affect the country. However, with improved macroeconomic management and the support of the international development community, the economic recovery is well underway and the medium-term outlook is cautiously optimistic.

Despite Tajikistan’s progress in recent years, significant challenges remain. The level of poverty is still high – by some estimates, up to 53% – and this points to a need to significantly increase social expenditures. Tajikistan also needs to address its winter energy deficit, improve energy efficiency, and promote energy trade. Structural reforms are also required in several areas. The Government plans to strengthen governance and reform several of its large state-owned enterprises. It also plans to improve public management and service delivery; promote a more business-oriented legal and judicial system; and implement land reforms. It intends to improve the investment climate to promote the private sector and create jobs.

ADB is a trusted partner and will work with Tajikistan to address these challenges. Our Country Partnership Strategy covering the period 2010–2014 sets out a roadmap for improving connectivity, energy security and private sector development, with regional cooperation as a binding theme.

The new partnership strategy, which was approved in June 2010, will support the country's efforts to expand energy supplies. As we all know, the country suffers from electricity shortages in winter and surpluses in summer, with just 10% of its considerable hydropower resources in use. ADB, as the largest multilateral development partner in the sector, will focus on rehabilitating existing infrastructure, as well as in developing clean, renewable energy to support both internal and regional demand.

The strategy also targets road improvements. ADB, which is also the largest multilateral development partner working in this sector, will focus on domestic and regional road links with the People’s Republic of China, Kyrgyz Republic, and Uzbekistan, including improvement of cross border customs arrangements and transit procedures.

We will also support public management reforms and other measures to improve the business and investment climate, including the use of public-private investment partnerships.

And we will continue to support the government’s push to strengthen regional ties through the Central Asia Regional Economic Cooperation Program (CAREC). Other priorities include tackling efficiency issues in public companies, and address climate change and other environmental matters, including flood controls.

Coordination among development partners is, of course, critical to our work. I am very pleased that, in November 2009, twelve development partners, along with the Government, signed the Joint Country Partnership Strategy, or JCPS. This is an important milestone in the development of aid coordination in Tajikistan. The JCPS has three main objectives: first, to affirm partners’ common commitment to Tajikistan’s development goals; second, to outline a shared strategic vision and operational framework for more effective coordination and management of resource flows; and third, to define the measures needed to achieve agreed development outcomes, including the benchmarks by which shared principles of aid effectiveness will be monitored. The JCPS partners’ assistance during 2010–12 is expected to concentrate on support for broad-based economic growth, human development, and good governance. The real challenge for both JCPS partners and the Government is immediately ahead of us. That challenge is to carry out our activities in line with the shared principles of aid effectiveness to assure ownership, harmonization, alignment, concrete results, and mutual accountability; and to complete the agreed time-bound actions during the next two years.

Two other topics are worthy of mention today. The first one is regional cooperation and integration. The benefits of regional cooperation are clear. For example, studies have indicated that one additional percentage point of growth in one country leads to a 0.7 percentage point increase in the neighboring countries. CAREC supports this mutually beneficial process by enhancing regional development in the areas of transport and trade facilitation, energy infrastructure, and trade. Just a month ago, at the CAREC Ministerial Meeting in Cebu in the Philippines, Ministers reinforced the importance of fostering economic linkages in this region. Tajikistan, in this context, is playing an important role through the development of transport corridors and by building strategic partnerships for the future.

The second topic is the need to develop public-private partnerships. Changing the role of the Government and the relationship between the state and the private sector is a complex task. However, if implemented properly, this process can bring positive results and trigger economic growth. The public-private partnership approach can benefit the energy and transport sectors. It will take considerable and serious efforts to build an adequate environment and framework for the approach. We at ADB think it is a challenge worth taking.

There are other essential issues to be discussed at the Forum. I would like to underline again that the steps that the Government has taken to date are remarkable and sound, and give us confidence that a long-term economic agenda will be implemented. While all items in the country’s development agenda are important, it is critical at this stage to agree on immediate priorities and establish targets with realistic expectations.

Mr. President, let me thank you once again for the opportunity to participate in this important event. On behalf of ADB, let me reiterate our continued support for Tajikistan and our commitment to work in close partnership with the Government and other multi- and bilateral development partners to ensure that the country achieves its economic development and prosperity. We look forward to a fruitful outcome of the Development Forum and, ultimately, to resource-mobilizing Consultative Group meeting in 2012.

The road ahead may be an arduous one, but it is one worth traveling. I invite all of us to make this journey together for the benefit of the people of Tajikistan.

Thank you.