IMF talks COVID-19 impact on Turkmenistan’s financial sector
BAKU, Azerbaijan, September 11
By Jeila Aliyeva - Trend:
The economic slowdown associated with COVID-19 has been likely slowing credit growth and increasing risks of loan delays and non-repayment in Turkmenistan, Natalia Tamirisa, International Monetary Fund (IMF) Mission Chief for Turkmenistan told Trend.
Tamirisa pointed out steps that would help to mitigate risks to both financial stability and fiscal sustainability.
“Under these circumstances, it is particularly important to ensure close supervision of banking sector activities,” she noted.
Among other things, supervisors should require banks to assess borrowers’ loan repayment capacity and report on the performance of their loan portfolios in an accurate and timely fashion, she added.
Earlier, Tamirisa said that the global outbreak of COVID-19 pandemic and lower energy prices might have a significant impact on Turkmen economy.
“Lower external demand and hydrocarbon revenues, increased health spending needs and disruptions in global and regional supply chains are weighing on the economic prospects,” noted earlier Tamirisa.
“The IMF projected real GDP at 1.8 percent and inflation at 8 percent in 2020,” she said adding that for 2021, Turkmenistan’s real GDP growth is forecasted to be 6.4 percent.
Tamirisa stressed that Turkmenistan has a pegged exchange rate supported by broad exchange controls on international transactions and payments in line with the country’s import substitution objectives.
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