The EBRD Board of Directors has approved unanimously a new strategy for Turkmenistan that underlines the Bank’s readiness to enhance its engagement in the country under a carefully balanced strategic approach linked to tangible progress in the process of economic and political reform.
While recognising some advances in Turkmenistan, the EBRD’s new country strategy emphasizes that further improvements in the economic, political and social spheres are essential. The EBRD encourages implementation of reforms in Turkmenistan that will enable the Bank to support the country’s transition towards an open market-oriented economy.
The EBRD’s core priority in Turkmenistan is to foster the growth of the private sector in the country, which remains at an early stage of development. The Bank will support private entrepreneurial initiatives, with specific focus on micro, small and medium-sized businesses, by enhancing their access to commercially-based finance and direct funding.
To boost the availability of financing to private companies in Turkmenistan, the EBRD will support the development of the financial sector in line with the principles of the market economy. The EBRD will seek to facilitate the creation of a private sector bank operating based on sound commercial basis.
Throughout its activities the EBRD will engage in close policy dialogue with Turkmen authorities with the view to improving the business environment and the institutional climate. The Bank will specifically seek to cooperate in optimising the legal and regulatory framework in Turkmenistan with the aim of alleviating entry barriers for new private businesses, reducing state intervention in the economy, initiating commercialisation and privatisation of state-owned industries and encouraging trade liberalisation.
In close cooperation with relevant international financial institutions, a special focus will be dedicated to improving the transparency in the budgetary process and public sector finance in general, including in relation to governing principles of the country’s stabilisation fund and foreign exchange reserve fund. This would underpin the possibilities for the EBRD to selectively expand its support across other sectors of the Turkmenistan economy.
The Bank is prepared to support selective transport infrastructure projects of regional importance in cooperation with other international financial institutions and the donor community, and to engage alongside private sector investors in natural resources projects that would promote sustainable development principles and international best practices in the sector.
The EBRD will annually monitor the progress in implementation of economic and political reforms in Turkmenistan, including by maintaining a close contact with civil society organisations, and will adjust its operations accordingly.
Since the beginning of its operations in Turkmenistan the EBRD has invested close to €110 million in the country’s corporate, energy, infrastructure and financial sectors, mobilising additional investments worth close to €390 million.