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Brief macroeconomic review based on results of banking system of the Republic of Tajikistan for the first half of 2022
On July 18, 2022, the press conference was held at the National Bank of Tajikistan on results of banking system activity for the first half of 2022. Such events are held in accordance with the order of the President of the Republic of Tajikistan dated September 15, 2011, No. AP - 1729 and the Plan for arranging and holding press conferences in ministries, departments, institutions and organizations, executive government authorities in GBAO, regions, Dushanbe city, towns and regions of the republican subordination.
The press conference was held under the leadership of Deputy Chairman of National Bank of Tajikistan Tolibzoda Firdavs Nazrimad, about 30 representatives of the media and heads of key structural subdivisions of the National Bank of Tajikistan took part in it.
Opening the press conference, Deputy Chairman of National Bank of Tajikistan Tolibzoda Firdavs Nazrimad has noted that in the first half of 2022, the National Bank of Tajikistan has consistently directed an effective monetary and foreign exchange policy to implement the instructions and orders of the Leader of Nation, President of the Republic of Tajikistan Emomali Rahmon to regulate the money supply in the economy, maintain a stable price level, financial stability and promote sustainable economic growth.
The press - conference for media representatives gave a brief overview of banking system and macroeconomic indicators for the first half of 2022.
In particular, it was noted that the Gross Domestic Product (GDP) of the country in January-June 2022 in nominal terms reached TJS 46.2 billion, its real growth has made 7.4%. The growth of economy during this period was mainly facilitated by an increase in the industrial production - 17.3%, retail trade turnover - 9.3%, provision of paid services - 12.8%, construction - 2.5% and agricultural products - 7.2%.
The inflation rate in January -June, 2022 has made 4,1% that is more for 0,2% compared to the same period of last year . This growth was mainly due to the rise in prices for foodstuffs by 7.0% and non-foodstuffs by 2.3%. At the same time, during this period, there was a decrease in the cost of paid services to the population, which amounted to 1.1%.
The annual inflation (for last 12 months) in June, 2022 has reached 8.3%, having decreased by 0.7% compared to the same period of last year.
In order to maintain a stable price level and regulate the money supply in the economy, the National Bank of Tajikistan through its instruments, implements monetary policy aimed at limiting the impact of monetary factors on macroeconomic indicators.
In order to regulate the money supply in circulation, effectively manage the liquidity level of credit institutions and reduce exchange rate and inflationary pressures, in January-June, 2022, securities auctions of the National Bank of Tajikistan were held for the amount of TJS 3.3 billion and through overnight deposit operations daily attracted an average of TJS 0.5 billion deposits of credit financial institutions.
In January-June, 2022, the refinancing rate as the main monetary instrument for conducting monetary operations was kept unchanged and set at 13.25% per annum.
During January-June 2022, the official exchange rate of the US dollar against the somoni decreased by 6.57% (from TJS 11.3000 as of December 31, 2021 to TJS 10.5578 as of June 30, 2022). The exchange rate of the US dollar in the same period of last year was higher by 0.18% (from TJS 11.3000 as of December 31, 2020 to TJS 11.3210 as of June 30, 2021).
There are 62 credit financial institutions operating in the republic, including 14 traditional banks, 1 Islamic bank, 18 microcredit deposit institutions, 3 microcredit organizations and 26 microcredit funds as of June 30, 2022.
The number of structural subdivisions of credit financial institutions for the reporting period amounted to 1,848 units.
As of June 30, 2022, the assets of credit financial institutions amounted to TJS 25.2 billion having increased by TJS 3.4 billion or 15.4% compared to the same date in 2021, mainly due to the loan portfolio, cash and other assets.
The liabilities of credit financial institutions as of the reporting date amounted to TJS 19.3 billion.
As of June 30, 2022, the liquidity ratio at the system level was fulfilled in full, which amounted to 101.1% exceeding the threshold set by the National Bank of Tajikistan by 71.1%.
As of June 30, 2022, the capital adequacy ratio, which is one of the main indicators of the financial stability of banking system, amounted to 25.1% exceeding the established threshold by 13.1%.
In general, the results of financial activities of credit financial institutions for the reporting period ended with a profit.
As of June 30, 2022, the total balance of deposits amounted to TJS 11.5 billion, which is more by TJS 1.8 billion or 18.8% compared to the same date of last year. In the structure of total balances of deposits, the share of deposits in national currency is 58.5% and in foreign currency- 41.5%.
In the structure of deposits, TJS 5.5 billion or 47.8% are deposits of legal entities and TJS 6.0 billion or 52.2% are deposits of individuals.
The credit investments are considered one of the main ways to ensure stable economic growth, expand domestic production and strengthen the country's export potential.
The volume of loans issued in January-June 2022 amounted to TJS 6.5 billion and their number reached 966.3 thousand units.
During this period, 35.6% of total issued loans accounted for consumption, 18.9% for agriculture, 15.7% for foreign trade, 11.2% for industry, 10.6% for services, 2, 5% for construction, 0.7% for transport and 4.8% for other branches.
37.9% of total issued loans falls on the industrial enterprises, the amount of which is TJS 2.5 billion. From total volume of loans issued during this period, 64.4% or TJS 4.2 billion somoni were issued to entrepreneurs.
72.9% of total amount of issued loans are microcredits, the amount of which has made TJS 4.7 billion, having increased by 6.7% compared to the same period of last year.
As of June 30, 2022, from total number of employees in the country's banking system, 38.5% are women, 18.6% of which are in senior positions.
The National Bank of Tajikistan, jointly with credit financial institutions takes all necessary measures to increase the share of non-cash payments, expand the scope of payment infrastructure and increase banking remote services.
As of June 30, 2022, the number of issued bank payment cards amounted to 4.2 million units, which is more for 28% than the same date of last year. The total number of electronic wallets of credit financial institutions amounted to about 5 million units, having increased by 2.0 million units (70%) compared to the same period last year.
On June 30, 2022, 20 domestic credit financial institutions installed 1,529 ATMs and 5,773 electronic terminals to serve payment card holders in the country. Compared to the same date in 2021, the number of ATMs increased by 300 units and the number of electronic terminals by 409 units.
In addition, in order to develop remote banking services and expand the share of cashless payments, credit financial institutions in trade and service enterprises began to actively install QR codes, which, unlike electronic terminals, require low costs and technical support and provide more opportunities for cashless payments. As of June 30, 2022, 14,825 units of QR codes are used in trade and service enterprises of the country, which is 6,902 units (87%) more than the same date last year.
In January-June, 2022, 14.3 million operations of non-cash payments for goods and services in the amount of TJS 2.9 billion were carried out in trade and service enterprises of the country through electronic payment instruments (payment cards and electronic wallets) and compared to the same period of last year the number of payments increased by 31.2%, and the volume of payments by 96.9%.
During the specified period, the ratio of cash withdrawal operations and non-cash payments for goods and services using electronic means of payment (payment cards and electronic wallets) amounted to 89.1% to 10.9%, and the share of non-cash transactions compared to the same period of last year increased by 1.2%.
In order to implement the Law of the Republic of Tajikistan "On citizens' appeals", from January to June 2022, the National Bank of Tajikistan received citizens' appeals in writing and orally, through telephones and the official website, and in total, 734 appeals were received for consideration including 33 appeals through the Executive Office of President of the Republic of Tajikistan and other authorities of Government of the Republic of Tajikistan; 74 appeals in writing directly to the National Bank of Tajikistan; 351 through a hotline, 276 appeals when receiving citizens for whom the necessary measures were taken within the framework of existing powers.
Then, specific answers were given to questions from representatives of local and foreign media, which mainly related to the instructions and orders stated in the Message of Leader of Nation regarding attracting the largest amount of foreign and domestic capital to the banking system, providing high-quality and affordable services, and expanding lending to such branches of economy as industry, agriculture, tourism and folk crafts, strengthening the risk management system, transition to cashless payments as well as protecting the rights of banking services consumers, international relations, supporting the IMF program, correspondent relations, etc.
Press Division