Start of negotiations with the IMF mission: meeting of Jamoliddin Nuraliev with the IMF mission

The next negotiations between the IMF representatives’ mission and National Bank of Tajikistan have resumed on August 18, 2020 in virtual mode. In the framework of these negotiations, a remote meeting was held by the IMF mission at the head of Ms. Padamja Khandelwal, which was opened by the First Deputy Chairman of NBT Jamoliddin Nuraliev.

The First Deputy Chairman of NBT Jamoliddin Nuraliev at the beginning has thanked the IMF mission for support and financial assistance in fight against the COVID-19 pandemic and overcoming its negative impact on the economy of Tajikistan, expressing readiness for fruitful cooperation and implementation of economic reforms.

During the meeting, which was held remotely, the First Deputy Chairman of NBT Jamoliddin Nuraliev has briefly familiarized the IMF representatives with current macroeconomic overview and banking system situation of the Republic of Tajikistan including the impact of the COVID-19 pandemic on the financial sector and measures taken by the NBT to overcome a negative impact of this disease on the economy, efficient implementation of monetary policy and payment system, mechanisms for effective management of international reserves, trade balance with main trading partner countries, its impact on the real effective exchange rate of Tajik somoni, gold mining sector, remittances, market pressures, recapitalization and liquidity plans and proposed reforms under the Extended Credit Facility Program.

The First Deputy Chairman of NBT Jamoliddin Nuraliev, in particular has noted that in order to prevent the impact of the COVID-19 pandemic on the country's economy, the NBT had developed an Action Plan to prevent the impact of potential risks associated with COVID-19 on the national economy, banking system and insurance sector, also certain work had been carried out in this direction. In particular, in order to support the economy of the republic, the Monetary Policy Committee of the NBT in May-July, 2020 has revised the refinancing rate twice and set it at 10.75 % per annum on August 3, 2020.

At the same time, in order to develop timely measures and support the liquidity of credit financial institutions, the ratio of required reserves of credit financial institutions for deposits and similar liabilities from April 1, 2020 in national currency was reduced from 3% to 1% (2 percentage points) and in foreign currency from 9% to 5% (4 percentage points). This measure during the crisis has allowed improving the situation of credit financial institutions providing additional liquidity for the banking system in the amount of TJS 241.7 million, - has noted J. Nuraliev.

During the meeting, the participants have exchanged views on the domestic foreign exchange market situation, closure of borders, the country's export potential and dependence on imports, inflation rates, management of international reserves and the vulnerability of the country's economy to the COVID-19 pandemic.

The head of the IMF mission in Tajikistan Ms.Padamja Khandelwal, has positively assessed the NBT's policy to minimize the impact of potential risks associated with COVID-19 on the banking system and ongoing reforms of the NBT and offered a number of recommendations to ensure financial stability, implement effective monetary policy and promote sustainable economic development.

In turn, Jamoliddin Nuraliev has considered expediently implementing the new IMF program in the framework of the Extended Credit Facility Program for cooperation of parties at the new level. “We express our readiness to implement new reforms for preventing the consequences of the COVID-19 pandemic on the country's economy including the banking system, insurance sector and monetary policy sector,” has noted the First Deputy Chairman of NBT Jamoliddin Nuraliev in conclusion.

It should be noted that negotiations between the IMF mission and the NBT will last from August 18 to September 3, 2020.

Press Division