On December 4 and 7, 2007, the World Bank Country Office in Tajikistan and the IFC Private Enterprise Partnership Program, in close collaboration with the Tajik State Committee on Investments and State Property Management, held back-to-back presentations and discussion of the recently released World Bank and IFC global report titled “Doing Business 2008: Comparing Regulations in 178 Economies” and the Tajikistan Private Sector Development Strategy, developed jointly by the Government of Tajikistan and the World Bank. 

Representatives of the Tajik Government and World Bank Group presenting the report, December 4

The first presentation targeted decision-makers in the Government  of Tajikistan and representatives of donor organizations implementing programs that help foster development of the private sector in Tajikistan. The second event, held on December 7, brought together broader community of stakeholders, including representatives of businesses, civil society organizations, media and others to discuss challenges faced by local and foreign private enterprises in Tajikistan and propose ways of creating more enabling business environment in the country.

The Doing Business report provides a comparison of global economies on the ease of doing business and private sector reforms. The report is co-sponsored by the World Bank and the International Finance Corporation (IFC), the private sector arm of the World Bank Group. Doing Business 2008 is the fifth in an annual series issued by the World Bank and IFC. It ranks 178 economies on the ease of doing business based on 10 indicators of business regulation. Since 2003, Doing Business has inspired or informed over 113 reforms around the world.

Representative of the State Tax Committee talking about the "Paying taxes" index, December 4

 Tajikistan continues to rank low on most of the Doing Business indicators as compared to the rest of the region. Its ranking on ease of doing business is 153 among 178 countries.  Tajikistan’s ranking slipped in several categories this year, including dealing with licenses, getting credit and registering property (3 places), paying taxes (2 places) and protecting investors and trading across borders (1 place). Several factors contributed to this decline, including poor performance on some indicators such as tax administration, lack of progress in regulatory reform over the past year as compared to other countries, and the addition of three new countries to the Doing Business report list in 2008.

Discussion with representatives of private sector, civil society and media, December 7

Doing business in Tajikistan did not change significantly in 2007, especially for small and medium enterprises, and several key issues continue to hinder progress.  For example, Tajikistan has no credit bureaus, which makes lending risky, and conditions for cross-border trade and the legislation that protects investors are in serious need of improvement.

Not all indicators were negative, however.  Due to recent reforms in licensing, in 2007, staring a business has become easier.  Tajikistan has risen 10 points in this area from the previous year.

This table provides some of the key Tajikistan indicators for the last two years:

The Tajikistan Private Sector Development Strategy, in turn, has been prepared by the World Bank, at the request of the Government of Tajikistan, in coordination and close consultation with the Ministry of Economic Development and Trade and the members of the Donor Coordination Council, which represents the bilateral and multilateral development institutions active in the country.

Despite Tajikistan's significant and consistent economic growth in recent years and its progress in various areas of economic reform, the private sector accounts for only about 50 percent of GDP private sector investment.

In Tajikistan, the private sector faces an array of issues that hamper their growth. Legal and regulatory barriers often stifle the establishment and development of new firms and constrain enterprise access to finance. The country's weak institutions and poor governance do not provide an environment conducive to domestic and foreign private investment or efficient public service delivery.

Thus, one key objective of the Government's strategy for private sector development should be to focus on those risks and costs that are under the control of Government and specifically those policies, laws, regulations and administrative procedures that result in the greatest risk, pose the greatest barrier to entry or to cost of dealing with Government, for the firm and thus are the greatest impediment to investment and private sector development.

For more details, please view the press release.

More information on Doing Business in Tajikistan.

Doing Business website: http://www.doingbusiness.org/