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                     Key Economic Indicators

                                   1992        1993      1994 1/

Income, Production and Employment:

Real GDP Growth (pct.)            -76.4       -28.0       N/A
GDP (at current prices) 2/        279.2       305.7     251.7
By Sector:
  Agriculture                     217.0       116.4       9.4
  Energy (bil. KWHs)               16.3        17.7      13.8
  Manufacturing 3/                207.0       378.6     506.7
  Construction                     16.5        17.8      14.4
  Rents                             N/A         N/A       N/A
  Financial Services               13.5        13.6      20.0
  Other Services                   0.53        0.40      0.20
  Government/Health/Education      59.5        43.6      34.8
Net Exports of Goods & Services   -11.1       -25.0     -28.8
Real Per Capita GDP (USD)         267.5        26.6       N/A
Labor Force (millions)             1.86         N/A      1.40
Unemployment Rate (pct.)              4         N/A       N/A

Money and Prices:  (annual percentage growth)

Money Supply (M2/bil. rubles)      15.3       145.2     130.0
Base Interest Rate 4/               N/A         N/A       N/A
Personal Saving Rate                 14          14        60
Retail Inflation                  406.6       555.4       N/A
Wholesale Inflation                 N/A         N/A       N/A
Consumer Price Index              823.2     1,065.0     110.8
Exchange Rate (USD/ruble)
  Official                        188.0     2,064.3   2,287.0
  Parallel                        188.0     2,064.3   2,287.0

Balance of Payments and Trade:

Total Exports (FOB) 5/             55.9        97.2     241.5
  Exports to U.S.                   N/A         6.8       5.5
Total Imports (CIF) 5/             12.6       122.2     269.7
  Imports from U.S.                71.9         3.9      12.9
External Public Debt              787.0     1,021.0   1,461.7
Debt Service Payments (paid)        N/A         N/A       N/A
Gold and Foreign Exch. Reserves     N/A         N/A       N/A
Trade Balance 5/                  -39.4        57.3     -70.1
  Trade Balance with U.S.         -71.9         2.9      -7.4

Note:  Reliable income, production and employment, money supply
and balance of trade data are not available in Tajikistan. 
While a country memorandum was produced by the World Bank in
April 1994, even that document notes the unreliability of data
due to inaccuracies in government accounting methods and poor
government information collection.  The figures provided, a
combination of both government and World Bank data, should be
used with caution and primarily as a basis for comparison.

N/A--Not available.

1/ 1994 figures are all estimates based on available monthly
data in October 1994.
2/ GDP at factor cost.
3/ Includes the cost of material expenses - net figures not
4/ Figures are actual, average annual interest rates, not
changes in them.
5/ Merchandise trade.

1.  General Policy Framework

    The severing of trade links with the countries of the
former Soviet Union (FSU) after the breakup of the USSR,
continuing uncertainty over Tajikistan's entry into the Russian
ruble zone and the complete shutdown of all inter-republican
banking payments have exacerbated a situation already in crisis
after two years of civil conflict and natural disasters.  The
economy continued to contract sharply throughout 1994,
affecting even the industrialized, highly productive region of
Leninabad in the north.  Some estimates put 1994 industrial
production at no more than 30 percent of 1988 levels and in
some sectors, such as construction, estimates are even lower. 
The collapse of domestic production has led to an almost total
dependence upon imports of consumer goods, particularly grain,
to the exclusion of capital goods and investments.

    While the government has taken some steps toward reform,
these have been to a large extent legislative exercises, with
no active implementation or enforcement.  A governmental
preoccupation with political stability combined with the
entrenched bureaucratic opposition to reform made the economy,
however dire the situation, a lesser priority.  In addition, no
resolution could be reached regarding the establishment of a
separate Tajik currency until the political situation
stabilized.  Approximately 90 percent of the economy remains
government-controlled and that which has been privatized has
gone, in the majority of cases, into the hands of the work
collective of that particular enterprise.  The government
further restricted the market in Tajikistan by increasing the
state orders for cotton and aluminum and limiting the issuance
of export licenses.

    Tajikistan's adoption of the Russian ruble as its official
currency without integration into the ruble zone has led to a
situation whereby Tajikistan is completely dependent upon the
largesse of the Russian Federation in order to obtain bank
notes.  This untenable situation has been precariously
maintained throughout 1994, although there is some hope that
the government elected in November 1994 may take more
aggressive steps to resolve the current crisis.

    The money supply has shrunk to the point that the economy
has reverted to a barter system, particularly in rural areas. 
Salary and pension payments lag months behind and workers are
paid on account as the liquidity of the Tajik economy is
completely dependent upon the delivery of ruble notes from 
Russia.  The reliance on imports together with the decline in
domestic production have led to the flight of rubles out of
Tajikistan almost as soon as they arrive.  Agreement has not
yet been reached with the Russian Federation on the rate of
exchange for pre-1993 rubles and hence all previously held
currency is literally frozen in bank accounts and not
convertible.  The government's debt to the population for
salary and pension payments in the first half of 1994 was over
220 billion rubles.

    Tajikistan's massive debt, totaling over $440 million or 31
percent of GDP for the first half of 1994, is financed for the
most part by credit from the National Bank.  Inflation has
remained fairly constant, even dropping over the summer, due to
the extreme shortage of banknotes in circulation.  Government
expenditures are largely for grain, the supply of fuel and raw
materials for industry, and expenditures for the military which
is maintained in response to attacks both along the
Tajik-Afghan border and against pockets of opposition
resistance within Tajikistan.  In addition, the government
still subsidizes inefficient state enterprises and provides
subsidized prices for food, fuel and other consumer items. 
While the government remains dependent on the Russian
Federation for about 80 percent of its trade and 14 percent of
its budget, 1994 saw the successful shift of a large proportion
of Tajik exports to Western partners, particularly in cotton
and aluminum.

    In 1994, virtually all of the aid which Tajikistan received
continued to be devoted to humanitarian assistance rather than
technical or development assistance or concessional financing. 
The World Bank donor conference scheduled for February was
postponed in September.  Uncertainties remain and hence
reconstruction loans valued at $20 million which were to have
become available in 1994 have been put on hold pending
resolution of Tajikistan's fundamental questions of political
stability and viable currency.  In November 1994, however, the
European Bank for Reconstruction and Development decided to
initiate a limited technical assistance project in the banking
sector.  The bulk of the proposed technical assistance
projects, however, have yet to find donors.

2.  Exchange Rate Policy

    Tajikistan is the only FSU state that still has the Russian
ruble as its national currency.  On January 5, 1994, Tajikistan
officially exchanged all of its old Russian rubles for new 1993
rubles.  Exchange rates in Tajikistan are tied to the MIREX
rate in the Russian Federation and are adjusted bi-weekly.  The
government maintains only one official exchange rate.  This
tracks fairly closely with the unofficial or black market rate,
differing only by 100 to 200 rubles.  Delayed entry into
monetary union with the Russian Federation resulted in an acute
cash shortage which is becoming increasingly severe with the
passage of time.  Unfortunately, with the conversion to new
Russian rubles, the Russian Federation and Tajikistan did not
agree upon an official exchange rate for the new and old rubles
and this issue is still outstanding between the two countries. 
The Government of Tajikistan has shied away from introducing a
national currency; this decision as prolonged the economic
crises and complicated decisionmaking.

    The introduction of the new Russian ruble without
Tajikistan's entry into the ruble zone has further resulted in
a segmentation of the money supply.  The scarce cash component
is made up of Russian currency which is internally and
externally convertible into cash or goods.  Enterprises are
charging as much as ten times the asking prices for purchases
made by non-cash transactions.  The result of this impasse is
that all "old" money deposited in accounts at the time of the
ruble changeover has been, in effect, "frozen" and is
inaccessible to both enterprises and individuals.  Throughout
1994, wages routinely lagged six months behind, and often as
much as eight to ten months.

    The impact of Tajikistan's exchange rate policies upon U.S.
exports is slight for the simple fact that there is little
substantial trade between the two countries.  Government
requirements for the sale of hard currency to the government
hard currency fund remain.  Depending upon the export product,
exporters are technically required to sell between 30 and 70
percent of their hard currency earnings to the fund.  The rate
of exchange, however, has been changed to match the market rate
and is adjusted bi-weekly to coincide with the official rate. 
The percentage of profit that must by law be exchanged varies
according to the percentage of the enterprise owned by the
foreign entity.

3.  Structural Policies

    1994 has seen an unfortunate acceleration of the
continuation of the return to centralized economic planning in
Tajikistan.  The government announced a new foreign trade
regime which concentrates virtually all export activity in the
Ministry of Foreign Economic Relations.  This ministry has the
exclusive right to issue export licenses in accordance with
quotas issued by the Ministry of Economy for all export
products, of which cotton and aluminum are the two main
strategic resources.  The impact of this legislation falls
primarily upon U.S. joint ventures or producers doing business
in Tajikistan.

    The new government came to power on a platform which
clearly stated the necessity to restrict imports of hard
liquor, tobacco products, and cotton oil.  There was also a
call for the regulation of all food prices.  In November,
however, Tajikistan adopted a new constitution which codifies,
for the first time, the right of the individual to own
property.  This could provide for the intensification of
privatization efforts, particularly in agriculture.

    Since 1992, Tajikistan has enacted numerous laws aimed at
broadening its economic reform efforts.  These laws have not
yet been effectively implemented for a number of reasons, chief
of which is the lack of political will among both the
government's top leaders and mid-level functionaries.  Tax
policy in Tajikistan was substantially revised in 1994, with an
overhaul of the tax code and an attempt to increase tax revenue
by the imposition of several new taxes.

4.  Debt Management Policies

    Tajikistan is a signatory to the zero-option accord with
the Russian Federation and is thus not liable for its share of
the debts of the former Soviet Union.

    Estimates from the Ministry of the Economy place
Tajikistan's budget deficit at over $440 million or 31 percent
of GDP.  This debt is financed for the most part by the
National Bank, but Tajikistan has also borrowed on unfavorable
terms in the world markets.  Russia is Tajikistan's primary
creditor, with current debts totaling $127 million.  The
Russian Federation supplied Tajikistan with a 120 billion ruble
loan in January as well as a second tranche of 30 billion
rubles in October.  Technical credits valued at 80 billion
rubles are promised but have not yet been delivered.  These
loans were guaranteed by Tajik assets in the form of major
industrial enterprises.  As of July 1994, debts to Kazakhstan
totaled $22.3 million while debts to Uzbekistan topped $96
million.  Russia has postponed Tajikistan's repayment of the
loans until January 1, 1996, but Tajikistan must repay $10.73
million to Uzbekistan and Kazakhstan in 1994.  Other debt
includes $27.5 million in P.L. 480 concessional food credits,
$50 million in Turkish commercial credits, and $5 million each
in Chinese and Indian commercial credits.

5.  Significant Barriers to U.S. Exports

    Tajikistan has several serious barriers to U.S. exports,
but these are more related to geography and the general
economic crisis than any deliberate targeting of U.S. goods and
services.  Tajikistan's geographical isolation, devastated
economy and, most importantly, lack of a national currency,
severely undermine Tajikistan's ability to trade effectively,
even with neighboring CIS states.  Interest in U.S. products is
precluded by the lack of banking transfers or cash payments
with which to purchase them.  Yet another contributing factor
is a business culture in Tajikistan which emphasizes personal
contacts over competitive bidding.  In general, legislation
encourages foreign investment but contradictory decrees and a
newly expanded tax burden make doing business in Tajikistan a
complex process.

    The government conducts virtually all trade in Tajikistan. 
Fine fiber cotton and aluminum are the two main sources of
government hard currency and trade deals are characterized by
the amount of tonnage the government has allocated.  The
government trade association "Somonion" is given an annual
quota of cotton and aluminum to sell in exchange for grain,
medicine and consumer goods.  With some effort, foreign
investors are able to negotiate very favorable deals with the
government and can receive benefits such as tax relief,
long-term land leases and resource allocations without which it
would be exceedingly difficult to do business in Tajikistan.

6.  Export Subsidies Policies

    Tajikistan is not a member of the GATT export subsidies
code.  Tajikistan retains to a large extent the Soviet practice

of indirect subsidies through inefficient socialist pricing
mechanisms.  In the case of aluminum, a major export, concrete
data is difficult to obtain, due to the common practice of
dealing through a third party or country.  U.S. Department of
Commerce figures, however, claim that Tajikistan accounts for
approximately one percent of aluminum imports to the United
States.  Subsidized government rates for energy (both gas and
electricity) and other operating and raw material costs, give
aluminum produced in Tajikistan a distinct advantage over
aluminum produced in the United States or elsewhere.

    In general, though, the government of Tajikistan has only
limited opportunity to use export subsidies as a means of
providing either direct or indirect support for exports - a
situation exacerbated by the economic crisis.  That
notwithstanding, the government is publicly committed to
supporting export-oriented state enterprises, chiefly by the
provision of scarce financing and government credits.  These
credits have gone largely to the agriculture, energy, mining
and textile sectors.

7.  Protection of Intellectual Property

    Protection of intellectual property is not a high priority
of the Government of Tajikistan, but neither is the need for
protection very severe.  While many laws designed to protect
intellectual property rights already exist, the government has
limited means by which to enforce them.  Piracy of video and
audio cassettes which are brought in from neighboring CIS
countries is the most common abuse of intellectual property. 
There is no evidence that Tajikistan exports any locally
produced pirated goods.  The small amount of piracy which
occurs in Tajikistan has a negligible effect, if any, on U.S.

    However, Tajikistan is undertaking the appropriate measures
to align itself with international intellectual property rights
standards.  Tajikistan is a signatory to the Universal
Copyright Convention.  The copyright agency created by the
government has little knowledge as to how best to approach its
task, and as yet its committee is not very active.  On February
14, 1994 Tajikistan became a member of the World Intellectual
Property Organization (WIPO).  In 1993, the government created
a national patent information center.  This center is charged
with the preparation of legislation required to enter into
international covenants.  In February 1994, the government
enacted legislation on the regulations governing inventions,
utility models and industrial samples.  These regulations cover
the creation, legal protection and use of the above. 
Tajikistan also maintains a state standards agency, which has
the main responsibility for trademarks.

8.  Workers Rights

    a.  The Right of Association

    All citizens are guaranteed the right of association.  Also
guaranteed is the right to form and join associations without
prior authorization, to organize territorially, to form and 
join federations and affiliate freely with international
organizations, and to participate in international travel.

    The Confederation of Trade Unions, a holdover from the
Communist era, remains the dominant labor organization,
although it has since shed its subordination to the communist
party.  The Confederation consists of 20 individual trade
unions and currently claims to have 1,500,000 members -
virtually all non-agricultural workers.  The separate labor
union of private enterprise workers has registered 3,241 small
and medium-sized enterprises, totaling 60,000 members, some of
whom have dual membership in the Confederation.  Both labor
unions are formally consulted by the Council of Ministers
during the drafting of social welfare and worker rights

    b.  The Right to Organize and Bargain Collectively

    The right to organize and bargain collectively is codified
in the Law on Trade Union Rights and Guarantees, the Law on
Social Partnerships and Collective Contract and the Law on
Labor Protection.  Although collective bargaining is guaranteed
by law, as the economic situation declines, enterprises are
finding it increasingly difficult to engage in effective
collective bargain. Any anti-union discrimination or the use of
sanctions to dissuade union membership is prohibited.

    C.  Prohibition of Forced or Compulsory Labor

    Neither the Law on Labor Protection nor the Law on
Employment specifically prohibit forced or compulsory labor. 
However, these laws do provide that a person has the right to
find work of his or her own choosing.  This principle is
enforced in the local trade union structure by the labor
inspectors.  The Soviet practice of compelling students to pick
cotton was officially banned in 1989.  However, due to the lack
of fuel and mechanical harvesting equipment in the fall of
1994, students were again sent to the fields to pick cotton as
they were in 1993.

    d.  Minimum Age for the Employment of Children

    According to labor laws, the minimum age for the employment
of children in Tajikistan is 16, the age at which children may
legally leave school.  With the concurrence of the local trade
union, employment may begin at age of 15.  Those less than 18
may not work more then six hours a day and 36 hours a week.
However, agricultural work, which is classified as "family
assistance," is routinely done by children as young as seven.
Trade unions are responsible for reporting any violations
involving the employment of minors.

    e.  Acceptable Conditions of Work

    The legal workweek for adults (over age 18) is 40 hours,
with a 48 hour rest period.  Overtime payment is mandated by
law with the first two hours of overtime to be paid at one and
one half times the normal rate and the remaining overtime at
double time.  The government has established occupational
health and safety standards, but these fall far short of
international norms and are not actively enforced.  Relative to
former Soviet standards, however, it is virtually certain,
given the continuing economic decline, that the one-fifth
working in substandard conditions reported in 1993 greatly
underreports the number working in substandard conditions in
1994 (although reliable new statistics are not available). 
There are occasional reports of armed militia forcing villagers
to perform agricultural work on private plots.  There are no
known instances of the use of child labor, other than in the
case of picking cotton.

    f.  Rights in the Sectors with U.S. Investment

    There is no significant U.S. investment in Tajikistan.

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