IMF to Loan Tajikistan $116 Million for Government Programs

By Shamim Adam

April 22 (Bloomberg) -- The International Monetary Fund agreed to give a $116 million loan to Tajikistan to help the Central Asian nation cope with a decline in export demand and lower remittances.

A deterioration in the global economy has “adversely affected” Tajikistan’s main exports of cotton and aluminum, and threatens to erode gains in poverty reduction, the Washington- based lender said in an April 21 statement. Tajikistan can draw about $38.7 million from the three-year loan immediately, the IMF said.

The government has “committed to raising transfers to households in response to the economic crisis, and increasing resource allocations for health and education, even though revenues are expected to decline on account of the crisis,” said the IMF’s first deputy managing editor, John Lipsky. “Authorities are delaying some low-priority investment projects and scrutinizing current expenditures carefully” to meet deficit targets.

Economic growth in the Caucasus and Central Asia will slow by two-thirds this year as exports recede and money sent from citizens abroad shrink, the IMF predicted last month. A slowdown in Russia is spilling over into countries including Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Tajikistan and Turkmenistan, the fund said.

To contact the reporter on this story: Shamim Adam in Singapore at sadam2@bloomberg.net