Tajikistan pleads poverty, spends money on unneeded luxuries

Tajikistan pleads poverty, spends money on unneeded luxuries
At least someone in Tajikistan is well-fed. / government handout
By Eurasianet April 28, 2023

The government of Tajikistan is so cash-starved that it can barely afford to feed its people or provide them with drinking water. It does, however, have enough money to buy the president his own plane.

International organisations have attributed the most recent decline in living standards in Tajikistan to the fallout from Russia’s invasion of Ukraine. The double whammy of shrinking remittances sent home by Tajik migrant labourers in Russia and inflation risks, according to one estimate, is tipping around 800,000 people into severe food insecurity.

It was against that backdrop that the US Agency for International Development (USAID) in February announced it was giving Tajikistan $13mn to support vulnerable families. USAID said the money would help 270,000 children and 240,000 pregnant and lactating women get vital access to nutrition care services. 

But that amount looks like a trifle compared to the $92mn that Tajikistan has recently spent on buying Emomali Rahmon a presidential plane from the government of Mexico. That this purchase came to light was only courtesy of the office of Mexican President Andres Manuel Lopez Obrador, who trumpeted the news on Twitter. 

“This money will be invested in two hospitals […] which will be built by military engineers and inaugurated before the end of my term,” Lopez Obrador said. 

López Obrador has been trying to offload the 787 for several years; commercial carriers were reportedly uninterested because of the luxury modifications. (Mexican presidential press service)

Lopez Obrador has been trying to offload the 787 for several years; commercial carriers were reportedly uninterested because of the luxury modifications. (Credit: Mexican presidential press service).

The result is that while Tajikistan relies on money from the United States and elsewhere to feed its citizens, Mexico will use Tajik money to cure its sick. 

With its economy under strain, Dushanbe has been getting handouts from all and sundry, and has had to do little by way of implementing, or even pledging, economic and political reforms in return.  

In October, European Union Council President Charles Michel visited Astana, Kazakhstan, to attend a maiden EU-Central Asia summit. All the region’s presidents were present.

Michel used the event to launch a project dubbed Sustainable Energy Connectivity in Central Asia, or SECCA, which is designed, in the words of European policymakers, to “strengthen national policies of transition to a sustainable energy system, and increase investment, capacity and awareness in renewable energy and energy efficiency.”

As part of the initiative, the EU allocated Tajikistan 29mn euros ($32mn) in grants. Out of that total, 14mn euros were earmarked for providing rural areas with drinking water.

Another task that Tajikistan is struggling to complete and fund on its own is its ambitious Rogun hydropower project. The government hopes Rogun will someday produce enough electricity to allow for the export of large amounts to Afghanistan and Pakistan, among other countries. Last year, Dushanbe said the project may end up costing $8bn to finish, and that remaining work will need no less than $5bn. 

Few foreign investors have shown much enthusiasm in getting involved in a colossal undertaking mired in opaqueness. Even Russian companies familiar with the vagaries of doing business in Tajikistan have baulked. A deal to develop Rogun hatched in 2004 between the Tajik government and Russian industrial giant Rusal was scrapped within three years amid claims that the latter had breached the terms of the agreement. 

In the past year, however, the EU has signalled it may be interested in getting involved. 

In July, the bloc’s investment arm, the European Investment Bank, revealed to Reuters news agency that it had been tapped by the European Commission to become “the largest investor” in Rogun. It is not yet clear what the commitment would entail, but its stated purpose is to reduce Tajikistan’s dependence on Russia and China’s continent-straddling Belt and Road Initiative. 

In what may have been a related development, Tajikistan got yet another gift in January, when the World Bank approved a $15mn grant to support the “financial and commercial frameworks” of the Rogun project.

“The […] grant will finance the hiring of experts on dam safety and environmental and social frameworks to help with necessary improvements that will bring the project in line with current hydropower industry requirements,” the World Bank said in a January 12 statement.

In simpler terms, the World Bank appeared to be suggesting that Tajik engineers have been cutting corners to save money.

But that is only the tip of the iceberg when it comes to World Bank largesse in Tajikistan.

In December, the lender’s board approved a $50mn disbursement to strengthen the country’s agriculture sector.

The following month, on the same day the Rogun grant announcement was made, the bank said it was greenlighting an additional $50mn handout for a reform programme “aimed at accelerating sustainable and resilient economic growth.” 

And in February, yet another chunk of $50mn in grant financing was approved for the purpose of “enhancing the quality of teaching and learning in Tajikistan’s secondary education.”

If any reform compliance mechanisms have been created to ensure that any of this money is not being misspent — or simply purloined — the World Bank has not explained what they are.  

Last month, the World Bank cut yet another cheque – in the shape of a $35mn grant – for a project to protect “poor and vulnerable households from social and economic shocks.” A World Bank-related structure, the Global Financing Facility Trust Fund, further sweetened the pot to the tune of $2.5mn.

More specifically, this project is, as the World Bank explained, designed to modernise Tajikistan’s social assistance system in ways that will more effectively alleviate poverty.

“Currently, less than 0.5 percent of [gross domestic product] is allocated to social assistance programs annually (compared to an average of 1.75 percent in the Europe and Central Asia region),” the World Bank noted.

Going by the World Bank’s most recent full-year figures, 0.5% of Tajikistan’s annual GDP amounts to around $43.5mn, which is not enough to buy even half of a second-hand Mexican presidential jumbo jet.

Mexican plane

This kind of dissonant spending is par for the course in Tajikistan. In 2020, at the height of the COVID-19 pandemic, the government accepted millions of dollars in international aid to pay for personal protective equipment, medical equipment and training to combat an outbreak of the coronavirus. Even as the virus was spreading, though, the authorities spent copious quantities of energy and money mounting a gargantuan party, all capped with a lavish fireworks show, to mark that year’s Nowruz holiday.

And all this few-strings-attached assistance comes as Tajikistan’s authoritarian regime shows no inclination to let up in its relentless hounding of anybody perceived as a government critic. Countless opposition figures have been imprisoned, sometimes following their forcible repatriation by means of extrajudicial abductions. The courts are entirely lacking in independence. The independent media and civil society scenes have been all but obliterated. High-level corruption is known to be rampant, but since anybody who dares to point this out can expect to be arrested, few dare to do so. 

Temur Umarov, a Central Asia expert affiliated with the Carnegie Russia Eurasia Center, argues that the West’s unconditional generosity is likely motivated by its desire to minimise Tajikistan’s reliance on Russia.

“In response to the appeals from [Central Asian countries] about their strong reliance on Russia, countries in the West are reacting with grants and thereby demonstrating that they are prepared to help weaken that dependency,” Umarov told Eurasianet.

A Tajik analyst who spoke to Eurasianet on condition of anonymity motivated by security concerns argued that the geopolitical situation was such that the West had lost the power to lay down ultimatums and link financial assistance to political reforms.

“Central Asia could now get all the Russian investment that had previously been destined for projects in Europe or Africa. Now that Russia has so few allies left, they are able to redirect their resources to Central Asia,” the analyst said. 

This article first appeared on Eurasianet here.