World Bank expects slowdown in Tajikistan's economic growth in 2025-2027

DUSHANBE. July 30 (Interfax) - The World Bank forecasts a decline in Tajikistan's GDP growth to 7% in 2025, 4.9% in 2026 and 4.7% in 2027, down from 8.4% in 2024, according to the World Bank's report on the country's economy.

Inflation, which stood at 3.4% in 2024, is projected to accelerate to 3.9% this year, 4.5% next year and 4.7% in 2027.

The main drivers of economic growth in 2024 and Q1 2025 (when GDP growth reached 8.2%) were the services sector and industry. Domestic demand was supported by significant remittance inflows, which accounted for around 49% of GDP in 2024 compared to 39% in 2023, as well as wage growth in the public sector.

This trajectory for projected GDP in 2025-2027 reflects the expected normalization of remittance inflows, persistent uncertainty in global trade that could disrupt supply chains, and declining demand for metals and minerals, except for gold, the World Bank said.

Maintaining strong economic growth in Tajikistan and unlocking its growth potential will depend on the government's commitment to accelerating measures aimed at attracting more private investment, the bank said. These include strengthening the competitive environment, enhancing investor protections and improving public sector efficiency to deliver better government services.

The country could also benefit significantly from digital transformation of its trade sector, the bank said. It highlighted substantial gaps in infrastructure and regulatory frameworks.

Nearly half of customs checkpoints lack proper internet connectivity, and there are deficiencies in digital identification, paperless trade, data protection, security standards, cross-border data transfer and consumer rights protection, it said.

The World Bank's report identifies several priority areas for accelerating digitalization in Tajikistan, including strengthening digital connectivity and cybersecurity, modernizing government digital services to improve online service efficiency, creating an integrated ecosystem for seamless trade and implementing performance monitoring.

It also emphasizes the importance of strengthening the legal framework to align with international standards for electronic transactions and data protection.

Currently, the World Bank is financing 26 projects in Tajikistan totaling $1.9 billion.