ADB president reiterates support for Turkmenistan economic diversification

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ASHGABAT (TCA) — Asian Development Bank (ADB) President Takehiko Nakao met with the President of Turkmenistan Gurbanguly Berdymukhammedov earlier this week in Ashgabat to discuss the country’s development priorities and reiterate support for the government’s efforts to diversify the economy, ADB’s press service said.

Mr. Nakao’s first visit to Turkmenistan also included meetings with Deputy Chairmen of the Cabinet of Ministers in charge of foreign affairs,  economy and finance, hydrocarbon sector, electricity and construction sectors, and the Chairman of the Board of the Central Bank of Turkmenistan and ADB Governor.

“Policies to expand manufacturing, promote local value chains and integrate them into the global ones are critical to create stronger and more balanced growth in Turkmenistan,” said Mr. Nakao. “They will reduce the country’s dependence on the hydrocarbon sector and will help create jobs for its growing working-age population.”

Turkmenistan’s economy relies heavily on oil and gas, which account for over 85% of the country’s exports. The earnings from hydrocarbon exports are expected to remain weak in the medium term due to low global energy prices. Nevertheless, the country’s economic growth is projected to average about 6% in 2016–2017.

ADB has provided strong support for the Turkmenistan–Afghanistan–Pakistan–India (TAPI) Natural Gas Pipeline, serving as the TAPI secretariat since 2003 and as transaction advisor since 2013. Once completed, the pipeline will export up to 33 billion cubic meters of natural gas per year from Turkmenistan to Afghanistan, Pakistan, and India. The pipeline will provide Turkmenistan with a larger market for its gas exports and generate greater revenues to support high value-added economic activities in the country.

For the next phase, ADB will be pleased to act as financial advisor to mobilize resources from other financial institutions. ADB will also consider financing shareholder equity in the TAPI project company, and provide non-sovereign loans and credit enhancement.

Since Turkmenistan joined ADB in 2000, ADB’s assistance has focused on modernizing the transport sector and increasing the country’s share of regional trade. ADB provided $125 million to finance the North–South Railway Project, to improve the transport link for regional trade from Turkmenistan to Kazakhstan, Iran, the Persian Gulf countries, Russia, and South Asia.

ADB is in the midst of preparing its new country partnership strategy with Turkmenistan for 2017–2021 to help the country achieve its national development agenda.

Sergey Kwan

TCA