Tajikistan Trade

Subchapters:

  • Business Relationships
  • Foreign direct investment
  • FTAs ​​and Treaties
  • Development Cooperation
  • Prospective fields of study (MOP)

Business relations

Trade relations with the EU

Tajikistan is among the favored countries within the European GSP program and uses the preferences and concessions provided by the EU. The share of EU countries in the total export of TJ is 5%, in the import – 7%. Among the EU member states, Tajikistan primarily trades with Germany, Switzerland, Italy, the Netherlands, Great Britain and Belgium. The main items in TJ imports from EU countries are machinery, transport and electrical equipment, chemical and pharmaceutical products, plants. TJ exports metals, aluminum, cotton and textile products, machinery, natural and cultured pearls, etc. to the EU.

(only for non-EU countries) General comment on trading with EU countries, comment on the numbers in the table, reasons for a positive or negative balance.

2017 2018 2019 2020 2021
Exports from the EU (million EUR) 170.1 170.9 167.3 185.6 238.8
Imports into the EU (million EUR) 42.3 45.8 44.4 86.9 162.2
Balance with the EU (million EUR) -127.8 -125.1 -122.9 -98.7 -76.6

Source: European Commission

Trade relations with the Czech Republic

The Czech Republic’s foreign trade with Tajikistan is at a low level. In 2021, there was an increase in imports from Tajikistan to the value of CZK 41 million, among the main import items were cotton products, (dried) fruits, nuts, chocolate, antimony and other similar goods. Exports from the Czech Republic were valued at CZK 127 million in 2021 and represented mainly plates, foils and other plastic products, cosmetics (hair products, shaving products, soaps), telephone devices and machines for automatic data processing and others.

2017 2018 2019 2020 2021
Exports from the Czech Republic (billion CZK) 0 0.1 0.2 0.1 0.1
Imports to the Czech Republic (billion CZK) 0.1 0 0 0 0
Balance with the Czech Republic (billion CZK) 0.1 -0.1 -0.1 -0.1 -0.1

Source: businesscarriers.com

Trade relations with countries outside the EU

Due to geographical location, logistics, historical ties, etc. especially trade with countries outside the EU is key for Tajikistan. The most important partners are Russia, Kazakhstan, China, Turkey, Uzbekistan, Japan, Iran, Pakistan, Afghanistan and others. The main import and export items are similar to trade with EU countries.

2017 2018 2019 2020 2021
Exports from countries outside the EU (million EUR) 722.8 832.4 679.5 497.9 535.8
Imports to countries outside the EU (million EUR) 2,378.9 2,673.6 2,802.4 2,606.7 3006.3
Balance with non-EU countries (million EUR) -1,656.1 -1,841.3 -2,122.9 -2 108.8 -2,470.5

Source: EIU, Eurostat

Foreign direct investment

In 2020, as a result of lower activity caused by the global covid-19 pandemic, foreign direct investment in Tajikistan was around USD 280 million. In 2021, they increased significantly to a value of 340 million USD. Regarding the sectoral structure, foreign investments are most often directed to mining and quarrying (ores, precious metals, metals, etc.), then to the development of infrastructure, telecommunications, construction and agriculture. Among foreign investors, China is the most active in Tajikistan (61.7% or USD 210 million in 2021), followed by Turkey (USD 26 million), Switzerland (USD 21 million), France (USD 19 million), Cyprus (US$10 million) and Great Britain (US$6 million).

In the first half of 2021, 74 investment projects with a total value of 38.1 billion somoni (billion USD) were implemented in Tajikistan. At the same time, the total amount of foreign investment in the country in the first half of 2021 was 27million USD.

ZÚ Tashkent does not register any direct foreign investments of Czech entities in Tajikistan. Opportunities are offered, for example, in the energy sector (modernization and construction of small and medium-sized hydropower plants or various industries).

FTAs and treaties

Treaties with the EU

Agreement on partnership and cooperation between the European Union and Tajikistan, ratified on 1.1.2010. It covers a wide range of issues, such as trade in goods, economic cooperation including support and protection of investments, energy, environment, transport, tourism, in addition to financial cooperation, cross-border provision of services and others.

Tajikistan is currently a participant in the standard EU GSP regime, but has expressed interest in joining the GSP+ regime in the near future. But the World Bank considers the country a low-income economy due to its low GDP per capita. Tajikistan makes extensive use of the preferences provided under the GSP. About 98% of goods are imported with reduced tariffs.

Contracts with the Czech Republic

To date, the following agreements and government contracts are valid between the Czech Republic and the Republic of Tajikistan:

Double Taxation Avoidance Agreement of 7 November 2006

Agreement on support and mutual protection of investments from 11.2.1994

Protocol on cooperation between the Ministry of Industry and Trade of the Czech Republic and the Ministry of Foreign Economic Relations of Tajikistan dated 11 February 1994

Agreement between the Ministry of Health of the Czech Republic and the Ministry of Health and Social Protection of the Population of the Republic of Tajikistan on cooperation in the field of health and medical science dated 26 November 2014

Memorandum on cooperation between the MFA of the Czech Republic and the MFA of the Republic of Tajikistan from 1 December 2016

Agreement between the government of the Czech Republic and the government of the Republic of Tajikistan on cooperation in air transport from 1 December 2016

During the visit of President M. Zeman to Tajikistan in November 2014, a joint statement of the presidents was signed. Negotiated between the two countries are: the protocol on the amendment of the agreement on the promotion and protection of investments, the agreement on international road transport.

Developmental cooperation

Tajikistan is a major recipient of development aid from around the world. Up to 40% of the total aid to Tajikistan comes from the European Union. Priority sectors are health, education and agriculture/rural development.

The European Union is currently implementing a multi-year aid program based on the National Development Strategy of the Republic of Tajikistan for the period 2016-2030, which has the overarching objective of improving living standards through sustainable economic development based on the achievement of a number of key objectives, including energy security and efficient use of electricity, food security and access to quality nutrition, productive employment and an end to connectivity restrictions.

Czech companies can participate in development cooperation through individual programs implemented by the EU.

Prospective fields of study (MOP)

Defense industry

The Ministry of Defense of Tajikistan has declared an interest in cooperation in the defense industry, especially in the field of aviation technology (modernization of L-39 and helicopters, pilot training), modernization of ground technology, weapons, radar and telecommunications technology. Due to the complex security situation in the region, the defense industry has long been a key priority of the government of Tajikistan, which plans to allocate USD 0.9-billion to the rearmament of the army by 2025.

Energy industry

Tajikistan produces 90% of its energy through hydropower plants, there is potential for cooperation in the modernization of outdated small and medium-sized hydropower plants, or the construction of new ones. The country also wants to focus on the production of energy from solar and wind sources.

Civil aviation industry

Tajikistan plans to modernize and develop civil air transport, purchase small aircraft, etc. and is interested in the possibility of cooperation from abroad, ideally using domestic aluminum reserves and labor. In this context, follow-up cooperation is possible in terms of passing on experience in the field of standards, licenses and regulations.

Healthcare and pharmaceutical industry

Due to the growing population of the country, the demands on health care are increasing. Tajikistan imports 90% of medicines, which can be a promising opportunity for Czech companies as well. The government program envisages attracting investments in the localization of drug production and cooperation in the pharmaceutical industry. There are also options for equipping medical facilities and training staff.

Transport industry and infrastructure

The government of Tajikistan is currently tasked with building international automobile transport routes as well as the gradual transition to emission-free means of transport. For the future use of electric buses and other vehicles, the country is preparing favorable import conditions. Due to its ambitions to become a transport corridor, Tajikistan plans to build about 1,000 km of roads in the next five years. In all phases of these projects, it is possible to find opportunities for the involvement of Czech companies, but the key is the price and the possibility of financing.

Tajikistan Trade