Tajikistan is assessed to have a medium debt-carrying capacity. CI rating for Tajikistan is 2.90, which is based on the October 2019 WEO and the World Bank’s 2018 CPIA.
The Ministry of Finance does not record non-guaranteed debt of SOEs. In 2019, TALCO, a loss-making state-owned aluminum company, was allowed to borrow without a government guarantee. Subsequently, TALCO has signed a MOU to borrow $545 million from China to modernize its plant. The finalization of contract and associated disbursement are expected in 2020. Separately, Tajiktransgaz has borrowed $300 million from Chinese entities for the construction of the Tajikistan section of the Turkmenistan-China gas pipeline.
State and local governments are not allowed to borrow without a government guarantee.
The baseline includes one disbursement of 80 percent of quota under the Rapid Credit Facility in 2020.
Staff’s baseline scenario assumes that the government continues to rely on external financing over the horizon. Over time, the development of domestic debt markets would be advisable. While such borrowing is likely to be more expensive, it would help reduce the vulnerabilities to external shocks.
There are weaknesses in national accounts statistics.
Barki-Tojik is a state-owned energy company in Tajikistan.
A successful refinancing of the Eurobond would smooth the repayment profile and the profile of the external debt service indicators.