WB: Tajikistan May Boost Investments to $2B with Reforms

Tajikistan-like other Central Asian nations-is grappling with a significant deficit of foreign direct investment (FDI) that could otherwise accelerate its economic growth, according to a new World Bank report titled "Tools of Transformation: Boosting Productivity Growth in Europe and Central Asia."

World Bank analysts say the shortage of investment stems from barriers in the business environment, logistical challenges, and policy restrictions that limit Tajikistan’s ability to expand trade and integrate more effectively into the global economy, The Caspian Post informs via Tajik media.

According to the report, improving the country’s investment climate could boost FDI inflows by up to 80 per cent, equivalent to $1.5-2 billion.

The study highlights that Tajikistan has strong untapped potential for increasing its trade volume but is currently unable to fully capitalize on it. Experts note that the country is losing a significant share of trade opportunities and could greatly expand its export capacity by better utilizing existing resources.

The report also emphasizes the importance of improving labor market efficiency, increasing workplace flexibility, and strengthening ties between educational institutions and employers. These measures would allow Tajikistan to make better use of its qualified workforce.

According to the World Bank, such reforms-combined with efforts to create a more attractive investment climate-could substantially boost productivity and stimulate long-term economic growth.

The report uses unique, enterprise-level data that provides fresh insights into productivity trends, challenges, and opportunities across the region. The dataset aggregates more than 40 million observations from 2008-2023 across 16 countries of Europe and Central Asia, sourced from national statistical agencies, tax authorities, and supplementary databases.