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LONDON (TCA) — For people in the heart of Central Asia, and especially those bearing state responsibilities, determining one’s fears means looking south and determining one’s hopes means looking north and east. Governments now pin their hope on regional economic integration, but that remains easier to profess than to make it happen.

They used to be called the Soviet soft belly. Today, they have become the rampart of the civilised world against the political jungle represented by Afghanistan, where aggressive and destructive forces such as Taliban, Daesh and Al-Qaeda have free game. Especially in the north of the country, the government of Afghanistan has little to say and the only counterforce against “Islamic” terror consists of warlords, a relic of the previous civil war that led to Soviet intervention in the 1980s. For the three states to Afghanistan’s north — Tajikistan, Uzbekistan and Turkmenistan — neutralising fifth columns at home is on top of the agenda. The best weapon to win that battle is prosperity for the population, but this is not an easy task since monetary constraints stand in the way of such a “welfare revolution”.

Economic growth

Through the first three quarters of this year overall economic growth stood at 6.7 per cent year-on-year in Tajikistan, and at 6.2 per cent in Turkmenistan, according to figures presented of late by the Moscow-based CIS Interstate Statistics Committee. Uzbekistan’s figure of 7.8 per cent referred to the first half of the year. Increases in industrial output value amounted to 5.8 per cent for Uzbekistan and to 16.7 per cent for Tajikistan, while on Turkmenistan no data were given. Overall capital investments in the first nine months increased by 22 per cent on-year in Tajikistan and by 4.6 per cent in Turkmenistan, and over the first half of the year by 11.8 per cent in Uzbekistan, according to the Committee.


Of the three frontline states, Tajikistan is the most exposed to terror and dramatic poverty especially in the autonomous eastern half of the country, which represents an open invitation for criminal elements of both secular and “religious” signature. To prevent this, the state has to keep tighter control over economic activity than it would wish to, and each year spends more than half of its income on social welfare. But allowances remain way below the equivalent of a hundred US dollar per person, representing less than one-third of the costs of the elementary nourishment basket. Here, the lack of cash flow within the national economy takes its toll.

Of late, the local news agency AsiaPlus quoted Prime Minister Qohir Rasoulzoda as observing that “… the main economic and social indicators [have] been fulfilled despite negative impact of external factors on the country’s economy”. Economic growth through the first eleven months of the year amounted to 54 billion somoni. But the external trade balance in January-November this year has remained negative, coming close to 2 billion in US dollar, with imports amounting to $5.9 billion and exports to $2.745 billion. Exports, however, are on the rise with an increase of 0.7 per cent over the period, with imports having decreased by 10.7 per cent. With the somoni having dropped from 10 to 12 per US dollar in the course of this year, access to imported goods has declined alongside.


In neighbouring Uzbekistan, the state is hardly in a better position to allow less public control over the economy. Following the death of one of Central Asia’s last “old timers”  (the only head of state in the region going back to Soviet times is Kazakhstan’s Nursultan Nazarbayev), the new man in charge risen from the high state echelons surrounding his predecessor, has made it clear that he is to make the country’s regional position more perceptive to political trends. It is not yet clear if this means strengthening ties with Moscow or introducing reforms.

Thanks to rising prices of key commodities starting as of late spring this year, Uzbekistan has managed to maintain a narrow external trade surplus, with income on exports over the first three quarters of the year standing at $12.871 billion against $12.416 billion spent on imports. But this gives no reason to talk of import substitution, despite the considerable sums the government pumped into domestic manufacturing sectors.

With inflation below 6 per cent due to fiscal restraint, poverty throughout the country remains nonetheless rampant. With a gross domestic product amounting to 66.73 billion in US dollar, or $1,857 per capita, over the first 11 months of the year, Uzbekistan is still suffering from insufficient purchasing power to allow a shift from sales to consumption and private investment as the key driver to economic dynamics. Investments therefore have to come from the state at the expense of private capitalisation, or from outside which means a heavier leverage on gains than domestic private investment allows.


Unlike Tajikistan and Uzbekistan, Turkmenistan has been hit hard by tumbling prices for natural gas. Since the beginning of 2014, spot prices at the Belgian trade hub of Zeebrugge and FOB prices to Germany have fallen from 11 to around 5 US dollar per thousand British Thermal Units. “Turkmenistan, once one of the poorest and least developed former members of the Soviet Union, has been one of the fastest growing economies in recent years,” a recent evaluation by global watchdog Trade & Economics read. “The most important sector of the economy is oil and natural gas extraction, which accounts for more than 60 per cent of GDP. Although agriculture accounts for only 10 percent of GDP, it employs 50 per cent of the labour force.”

But the report adds: “Turkmenistan's economy advanced 6.2 per cent year-on-year in January-September of 2016, compared to 7.5 per cent a year earlier, due to a decline in energy prices and Russia's decision to stop purchases of Turkmen gas.”


In all, the balance for 2016 in the five ex-Soviet republics of Central Asia can be observed rather simply: much trouble prevented, not too much progress made. Continuation of the current policies by legitimate but excessively influential governments may well keep terror brewing in Afghanistan at bay, but any major cash relief is not anywhere in sight while only this could substantially and sufficiently lift populations’ living standards to “terror-resistant” levels.


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