DUSHANBE, July 10, Asia-Plus – On Thursday July 6, the World Bank’s Board of Executive Directors approved two grants for a total amount of US$15 million to support the Government’s reform efforts aimed at increasing the effectiveness of the public sector, development of the private sector, and more efficient social service delivery.

According to information from the World Bank Dushanbe office, the Programmatic Development Policy Grant, in the amount of US$10 million, will support the government’s reform program as outlined in its Poverty Reduction Strategy Paper (PRSP). The project will help improve the environment for private sector development, and improve the overall functioning of the public sector and the delivery of key public services. The proposed program is aligned with the first two pillars of Tajikistan ’s PRSP.

The US$5 million Public Sector Reform Grant will finance technical assistance that will complement and support the Programmatic Development Policy Grant. The project will assist the Government in the implementation of its Public Administration Reform Strategy, through strengthening policymaking and service delivery systems and enhancing transparency of public management in selected core public sector entities.

  Tajikistan has 6.7 million inhabitants and a per capita income of US$310.  Press release issued by the World Bank says its economy has been growing on average at a rate of 9.4 percent per year between 2001-04.  Tajikistan depends heavily on exports of cotton and aluminum, the majority of which are destined for other CIS countries and Europe , as well as on the growing remittances of emigrants, which are conservatively estimated to make up some 16 percent of GDP per year. Poverty, although declining, remains high. In 2003, 64 percent of the population was considered poor, using the purchasing power parity poverty line of US$2.15.   Social indicators remain low, reflecting the inadequate quality of public service delivery and weaknesses in the governance system.

Sustaining long-term economic growth in Tajikistan will require accelerating export growth and diversifying the domestic economy by stimulating investment, improving productivity, and strengthening competitiveness.

In general, reforms supported by the proposed operations are expected to stimulate economic growth and reduce poverty. In the short term, the proposed reforms in health and education are likely to result in improved access and quality of services to the poor. In the medium term, the reforms proposed in the public administration reform strategy should yield benefits through improved public sector management.

Tajikistan became a member of the World Bank in 1993. Since that time, the World Bank has approved twenty-nine lending and grant-funded projects for a total commitment of approximately US$415 million, of which around US$350 million has already been disbursed.