Washington, DC – June 25, 2025 – The International Monetary Fund (IMF) has concluded its 2025 Article IV Consultation and the Second Review of the Policy Coordination Instrument (PCI) with Tajikistan, commending the country for its continued strong economic performance and commitment to structural reforms.
Tajikistan’s strong growth performance has continued into 2025, accompanied by a steady improvement in macroeconomic fundamentals. Large financial inflows have contributed to a favorable external position, with FX reserves amounting to 7 months’ import coverage, while prudent fiscal policy has anchored a continued reduction in public debt to 25 percent of GDP at end-2024. Inflation remains well-contained at 3.6 percent (y/y) in April 2025. The near-term outlook remains positive, but subject to considerable regional uncertainty that could result in a less favorable external environment.
Approved in February 2024, the 22-month PCI aims to anchor Tajikistan’s macroeconomic stability and support reforms promoting inclusive and sustainable growth. According to the IMF, program implementation remains broadly on track, with all but one quantitative target met and reform milestones largely achieved.
Resilient Economic Growth Amid Regional Risks
Tajikistan’s economy continues to expand robustly, with real GDP projected to grow by 7.0% in 2025, following an impressive 8.4% in 2024. Inflation remains low at 3.6% year-on-year as of April, and foreign reserves cover seven months of imports, reflecting large financial inflows and effective macroeconomic management. Public debt declined to 25% of GDP by end-2024 due to prudent fiscal policies.
Despite the positive outlook, the IMF cautioned that Tajikistan remains vulnerable to regional instability and external shocks, especially given its reliance on remittances and a narrow export base.
Fiscal Anchors and Governance Reforms Encouraged
The Fund welcomed the government’s commitment to a fiscal deficit ceiling of 2.5% of GDP, calling it essential to maintaining debt sustainability. It urged authorities to improve revenue mobilization, cut inefficient expenditures, and enhance the efficiency of public investment.
IMF Directors also emphasized the importance of strengthening governance in state-owned enterprises (SOEs), particularly in the energy sector. While they acknowledged steps to address financial arrears in the national electricity company, they called for stronger cost controls and improved billing practices.
Monetary Vigilance and Financial Oversight Needed
The Fund praised the central bank’s cautious approach amid strong credit growth, but flagged the need for greater exchange rate flexibility and tighter liquidity management to navigate ongoing capital inflows. Continued development of the foreign exchange and domestic debt markets was recommended.
Tajikistan’s banking sector has shown resilience, with improved balance sheets supporting credit expansion. However, the IMF warned that rising household lending could pose risks and called for enhanced macroprudential oversight.
Structural Reforms and Transparency as Key Growth Drivers
Broad-based structural reforms remain critical for sustained, private sector-led growth. The IMF urged continued progress on anti-corruption initiatives, improving transparency in the extractive sector, and closing institutional data gaps.
“The authorities’ strong performance under the PCI provides a valuable window of opportunity to deepen structural reforms, support job creation, and build resilience to future shocks,” said Kenji Okamura, IMF Deputy Managing Director and Acting Chair.
The next Article IV consultation with Tajikistan is scheduled for 2027, following the standard 24-month cycle.
