Rapid growth driven by public investment and rising hydrocarbon exports continued in Turkmenistan during the first half of 2013, with gross domestic product (GDP) rising at an annual rate of slightly more than 9.0%, according to government reports. All sectors recorded growth, with construction surging by 17.7% and services by 11.3%, while agriculture grew by 7.0% and industry by 6.6%. Growth in industry reflects the completion of the first stage of the Galkynysh gas field, which is expected to boost gas production by 19% relative to 2012. In view of the generally favorable economic environment, the Asian Development Outlook (ADO) 2013 Update maintains growth forecasts of 9.0% for 2013 and 8.0% for 2014.
|Selected Economic Indicators (%) - Turkmenistan||2013||2014|
|ADO 2013||Update||ADO 2013||Update|
|Current Account Balance (share of GDP)||2.0||2.0||3.0||3.0|
Source: Asian Development Outlook (ADO) 2013 Update; ADB estimates.
The ADO 2013 Update maintains inflation forecasts at 6.0% for 2013 and 6.5% for 2014. Inflation will reflect the country’s expansionary fiscal stance and rising consumption, both public and private, fueled in particular by rising public sector wages, which rose by 11% in the first half of 2013; a further 10% increase in teachers’ salaries slated for September 2013; and some liberalization of administered prices. Inflation is expected to rise further in 2014 with the government decree mandating a 10% rise of salaries, pensions, stipends, and other benefits starting in January 2014, coupled with the rapid pace of public investments.
The giant Galkynysh gas field will come onstream in the second half of 2013 and is expected to raise gas exports by the equivalent of 2.6%-3.0% of GDP in 2013. Despite this, the current account surplus forecast is maintained at 2.0% of GDP in 2013 and 3.0% in 2014 because Turkmenistan will continue its extensive imports of services for construction and hydrocarbon extraction, and of industrial machinery and high-tech equipment.
Source: ADB. 2013. Asian Development Outlook 2013 Update. Manila.