Turkmenistan seeks innovative development

Business Materials 23 October 2012 20:15 (UTC +04:00)

Turkmenistan, Ashgabat, Oct. 23 / Trend H. Hasanov /

The Turkmen leadership on the eve of the 21st anniversary of the country's independence, which will be celebrated on October 27, has summed up the results of the year and discusses future plans. Several government meetings in Ashgabat and a meeting of the Council of Elders in Turkmenbashi on Tuesday were dedicated o this topic.

While developing the national economy, Turkmenistan has chosen the right way, focused primarily on its comprehensive modernization and diversification and gradual transfer to market economy, Turkmen President Gurbanguly Berdimuhamedov said at the meeting of the government. He drew attention to the need for an innovative approach to these issues.

The growth rate of gross domestic product (GDP) was 11.1 percent for the nine months of the year. The share of industry has significantly increased in total GDP volume by 13 percent compared to the same period of last year.

Turkmenistan holds a key position in the region for the natural gas supply. Russia, China, Iran are importers.

Ashgabat has chosen a policy of diversifying the economy. The oil and gas processing, textile, cotton-processing industries and production of building materials have been actively developing. There are certain tasks to increase the export value of chemical, petrochemical and light industries.

High indices were achieved in the production of many kinds of products from January to September 2012 compared to the same period of 2011.

Electricity generation rose by 6.4 percent, natural gas - by 8.5 percent, oil - 5 percent, petrol production - 5.6 percent and diesel fuel - 1.6 percent, kerosene - 7.4 percent, lubricating oils - 16.3 percent, liquefied natural gas - 17.7 percent, polypropylene - 11.4 percent.

The policy of a gradual transition to a market economy has been reflected in the updated Constitution. The national currency was denominated. The exchange rates were unified. It is planned to move to international accounting standards.

The state ownership for the range of labor tools and objects remains in basic and strategic industries, such as fuel and energy complex and power generation.

The international financial institutions focus on the economic situation in the country. The World Bank has assigned Upper Middle Income Country Status to Turkmenistan, World Bank Vice President for Europe and Central Asia Philippe Le Houérou wrote in his letter to the Turkmen leader.

The International Monetary Fund (IMF) in its recent report stressed that perhaps, direct impact of the European crisis on the Turkmen economy will continue to be limited.

The IMF said that the Turkmen economy showed good results in 2011 and in the first half of 2012. Growing gas export to China and a sharp increase in public investments ensured high rates of GDP growth.

The volume of investments increased by more than 9 times over the last five years. The share of investments to GDP over the same period ranged from one-third to a half of the national product.

Turkmenistan aims at the implementation of priority projects. The construction of an urea and ammonia plant has been launched in the town of Mary town.
The first phase of the largest mining and processing complex for potash production is being mastered in Lebap region.

Turkmenistan plans to complete construction of the Turkmen section of North-South railway project by late 2012. Kazakhstan and Iran participate there. The transport infrastructure is being improved throughout the country. Turkmenistan actively develops the field of communications. It is expanding access to the Internet, digital communication. The national space satellite is planned to be launched.

While working on the diversification of the economy, Turkmenistan actively continues developing strategic oil and gas sphere. A share of oil and gas production by joint ventures and foreign companies also increases.

The gas pipelines "Turkmenistan-China" and "Dovletabad-Sarahs-Hangeran" in the direction of Iran have been built and make a significant contribution to the diversification of export routes.

"East - West" internal gas pipeline, which will connect the country's largest gas field Galkynysh with the coast of the Caspian Sea is being built. The European market may be mastered after constructing the offshore gas pipeline near the Azerbaijani coast.

An international consortium implementing the large-scale project of the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline is being formed. However, the experts say that the continuing escalation of tension in Afghanistan remains the main obstacle despite the economic expediency.

Ashgabat hopes for the development of the Caspian Sea. A report on the operations in discovering new oil and gas structures in the Turkmen sector of the Caspian Sea has been recently heard at the government meeting. Petronas, Dragon Oil, Buried Hill, RWE, Itera operate there. The international tender involves 32 licensed blocks. According to some estimates, 11 billion tons of oil and 5.5 trillion cubic meters of gas of the projected resources, excluding the contracted blocks are concentrated here.

The Turkmen Parliament has lately received the state budget for 2013, in which the revenues of the state budget are 86.335.8 billion manat, expenses - 89.735.8 billion manat. I

The official rate of the manat to $1 remains at 2.85 Turkmen manat. A significant part of the income has been calculated for 10-percent raising of salaries and state benefits, as well as a 15 percent increase in pensions from 2013.