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Tajikistan: Financial Sector and Fiscal Management Improvement Program (Subprogram 1)

Sovereign (Public) Project | 51066-001 Status: Proposed

The proposed Financial Sector and Fiscal Management Improvement Program aims to support the Government of Tajikistan with reforms to create a more stable financial system, enhance access to financial services, and improve fiscal management to accelerate sustainable private sector growth. The program will (i) enhance banking sector stability, (ii) improve the enabling environment for the financial sector, and (iii) strengthen public financial management.

Project Details

Project Officer
Alexander Julian Central and West Asia Department Request for information
Country
  • Tajikistan
Sector
  • Finance
 
Project Name Financial Sector and Fiscal Management Improvement Program (Subprogram 1)
Project Number 51066-001
Country Tajikistan
Project Status Proposed
Project Type / Modality of Assistance Grant
Source of Funding / Amount
Grant: Financial Sector and Fiscal Management Improvement Program
concessional ordinary capital resources lending / Asian Development Fund US$ 50.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Knowledge solutions
Private sector development
Sector / Subsector

Finance / Banking systems and nonbank financial institutions - Central banking systems - Finance sector development - Money and capital markets

Public sector management / Economic affairs management - Public expenditure and fiscal management

Gender Equity and Mainstreaming Some gender elements
Description The proposed Financial Sector and Fiscal Management Improvement Program aims to support the Government of Tajikistan with reforms to create a more stable financial system, enhance access to financial services, and improve fiscal management to accelerate sustainable private sector growth. The program will (i) enhance banking sector stability, (ii) improve the enabling environment for the financial sector, and (iii) strengthen public financial management.
Project Rationale and Linkage to Country/Regional Strategy

Private investment in Tajikistan declined from 6.2% of GDP in 2014 to 4.5% of GDP in 2017, below the regional average of 15.6% of GDP. Domestic credit to the private sector fell from 23% to 12% of GDP over 2015-2018, far below the regional average of 63% of GDP, and is identified as a top constraint to private sector development. Empirical analysis shows financial sector development has a statistically significant and relatively high impact on private investment. Insufficient public investment, including in critical infrastructure (e.g. energy and water) and a skilled workforce, also limits private investment. Poor public investment management practices, e.g. project appraisal and costing and absence of suitable resource allocation plans, including a medium term budget framework, create gaps in infrastructure and services needed for private investment and supporting economic growth.

The program is consistent with the Asian Development Bank (ADB) country partnership strategy for Tajikistan, 2016-2020 and ADB's Strategy 2030, aligned with strengthening governance and institutional capacity. The program will support the government's reform agenda in the national development strategy up to 2030. The policy-based financing will be a programmatic approach that includes two subprograms to be implemented during 2020-2021.

Impact Sustainable economic development improves the standard of living of the population (National Development Strategy of the Republic of Tajikistan for the Period up to 2030)
Outcome Private sector investment increased
Outputs

1. Banking sector stability enhanced

2. Enabling environment for financial sector improved

3. Public financial management strengthened

Geographical Location Nation-wide
Safeguard Categories
Environment C
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Responsible ADB Officer Alexander Julian
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Public Management, Financial Sector and Trade Division, CWRD
Executing Agencies
Ministry of Finance
3, Academic Rajabovs
Dushanbe
Tajikistan
Timetable
Concept Clearance 10 Dec 2019
Fact Finding 06 Aug 2019 to 06 Aug 2019
MRM 03 Sep 2019
Approval -
Last Review Mission -
Last PDS Update 10 Dec 2019

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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Safeguard Documents See also: Safeguards

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Evaluation Documents See also: Independent Evaluation

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Related Publications

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Tenders

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Contracts Awarded

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Procurement Plan

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