Promoting the local economy in Tajikistan

Project description

Title: Supporting the local economy in selected high-mountain regions
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ) 
Country: Tajikistan
Lead executing agency: Ministry of Economic Development and Trade 
Overall term: 2016 to 2020

Context

Due to Tajikistan’s high-Alpine location, only seven per cent of its land can be used for intensive agriculture. The location also makes the country particularly vulnerable to climate change. At 51 per cent, the poverty rate in the Gorno-Badakhshan (GBAO) region is significantly higher than the national average. The transition to a strong market economy is hampered by historical factors, an example being the culture of bartering as a survival strategy. 

GBAO is undergoing profound social change. In particular, large-scale labour migration, especially among men, has substantially changed and destabilised the social structures in both rural and urban areas. Major impediments include structural weakness in the region, the high risk of a climate catastrophe and changes such as crop failures, fluctuations in production and variations in quality. On top of this, women have insufficient access to primary products, markets and information, while the transport infrastructure is greatly neglected. High levels of emigration, especially among the young population, a lack of energy security, and the adverse effects on competition and production additionally hamper the region’s development. The most important economic area in GBAO is Khorog.

Objective

The competitiveness of micro, small and medium-sized enterprises (MSMEs), including that of smallholder farmers, in the catchment area has been strengthened.

Approach

The project builds on the approaches of the successful predecessor project. It focuses on formats for skills development supplementing each other, organisational development measures and the procurement of materials and equipment, such as laboratory equipment for food safety. The project’s strategy starts with ministries, institutions and communities. The main focus is on the institutions and communities, where key business stakeholders in the Khorog catchment area are supported in implementing practice-oriented advisory service formats for MSMEs, including smallholder farmers. In parallel, the project supports self-help structures between several companies in making better use of the marketing potential of local products, which are then more competitive on the domestic market. It also advises the local administration on fleshing out measures to promote the local economy.

In addition, the technical cooperation module contributes towards the implementation of the national strategy for the preservation of biodiversity (2016 to 2020) by means of a climate-sensitive product selection, for which specific marketing strategies are developed.

Results

• Cooperation with the regional administration has led to the consulting services offered for entrepreneurs and potential business start-ups being institutionalised. 
• The microfinance organisation Madina va Hamkoron supported by the project, provides affordable financing options for 100 small and micro companies. 
• Sixty promoted companies have already been able to create new jobs. 
• In the medium term, the better equipment and the training provided for the local food laboratory are leading to significant improvements in the quality of local agricultural products, which enhances market opportunities.