Ashgabat, Turkmenistan, March 30
By Huseyn Hasanov – Trend:
A delegation of the International Monetary Fund (IMF) held a meeting in Ashgabat with the leadership of the Union of Industrialists and Entrepreneurs of Turkmenistan (UIET), Trend reports with reference to the UIET.
Particular emphasis was placed on the international contacts of the UIET, the development of import-substituting and export-oriented industries, the creation of foreign trade missions and joint ventures, the report said.
The activity of the Joint-Stock Commercial Bank “Rysgal” on financial support for business projects became a separate topic of conversation. The relevance of the participation of private entities in the implementation of the “Concept of digital economy development for 2019-2025” was emphasized.
Representatives of the IMF discussed the achievements of the non-state sector of the Turkmen economy, noting the positive dynamics of its development. It was noted at the meeting that the projects being implemented by the UIET include the construction of a potash plant, the Ashgabat-Turkmenabat high-speed highway, the development of export opportunities for private greenhouses, poultry farms and fish industry facilities.
Turkmenistan holds one of the key positions in the region in terms of the supply of natural gas - China and Iran are importers. At the same time, Russia - the traditional buyer - stopped buying Turkmen gas in 2016. Against this background, the Turkmen entrepreneurs began to experience difficulties due to currency conversion restrictions.
In March 2018, the IMF recommended Turkmenistan to ease foreign exchange regulations on imports and other current international payments.
“In the IMF staff’s view, the main near-term policy challenge remains taking action to reduce external imbalances,” the IMF noted. “The recent reduction in public investments as a share of the economy is welcomed. However, given the size of the external deficit, additional measures should be considered, including exchange rate correction and further fiscal and monetary tightening.”
Real sector reforms should focus on significantly simplifying administrative procedures and regulations, accelerating reforms and privatization of the state-owned enterprises, and attracting foreign direct investment, according to the IMF.
“The simplified framework for the free economic zones holds the promise of attracting new private investments, including from abroad, and any positive lessons should be applied across Turkmenistan more broadly,” said the IMF.
Turkmenistan headed for gradual transition to market economy, which was reflected in the Constitution.
At this stage, a number of activities were carried out: the denomination of the national currency was implemented, the country moved to international accounting standards in 2014. At the beginning of 2015, the Central Bank of Turkmenistan set the official exchange rate of the national currency at 3.5 manats per US dollar, which is still preserved.