economy includes more than 90 sectors. Majority of companies
have been transformed into joint stock companies and private
entities, some with attraction of foreign investment. At
present, Tajikistan has achieved a qualitatively new stage
of development, when restructuring of various sectors of
economy and private sector development started to bring
some positive results. Under these circumstances, investments
in real sector of economy become effective and profitable.
direct investment (FDI)
1996 total volume of FDI reached approximately US$277 million.
In 2002 foreign direct investments in economy of Tajikistan
reached US$36 million, which exceeds 2001 level by 3.8 times.
Significant growth of FDI followed economy economic stabilization
in te country and was directed in equity of Tajik companies.
There are more than 300 enterprises with foreign capital
operating in Tajikistan. Primary targetsof FDI were gold
mining (30%), commercial activity (19%), food (17%), construction
(16%) and chemical industry (8%). In 2002 major sources
of FDI included the United Kingdom (40.2%), Russia (23.4%),
the USA (7.8%), Cyprus (7.6%), Pakistan (6.9%), Canada (6.8%).
Apart from Pakistan, among IDB member-countries major FDI
sources also included Turkey (US$ 848.300), Iran (US$385,500)
and UAE (US$200.000).
lack of investment is an acute problem. It is the cause
of low productivity and production volumes in manufacturing
as well as of a weak infrastructure. The government started
active development of national infrastructure. Together
with IFIs several large road and bridge reconstruction and
rehabilitation projects with the view to upgrade them internationally
acceptable standards. Electricity distribution facilities
are also undergoes a serious overhaul, as well as system
of air navigation and telecommunications. New infrastructure
facilities are also built with the use of own reserves and
with assistance provided by bilateral donors.
1999 a new tax code development together with international
experts has been in force in the RT. Enforcement of the
TAX Code tax allowed to significantly simplified tax system
by reducing number of taxes and simplifying the mechanisms
of tax collection, shortening administrative expenses associated
with state revenue collection. There are the following state
taxes in the RT.
Income tax levied upon physical persons;
2. Profit tax levied upon legal persons;
3. Value Added Tax (VAT);
5. Social contributions;
6. Land tax;
7. Subsoil use tax;
8. Property tax levied upon legal persons;
9. Road tax levied upon legal persons;
10. Tax levied upon vehicle owners;
11. Simplified tax levied upon small businesses;
12. Cotton and aluminum sales tax;
13. Customs duties and fees;
14. State duty.
the view t further promote foreign direct investment and
develop of real sector of economy, the Government has drafted
a new law “On free economic zones (FEZ) in the RT”,
which is currently being reviewed by the Parliament. Draft
law provides for legal and economic basis of organization
and functioning of FEZ as separate areas with special customs
and tax regimes within their boundaries, including full
or partial relief from customs tariff when importing goods
to FEZ; simplified procedure for transportation of goods
and vehicles across FEZ boundaries; and cancellation of
is also proposed that legal and physical persons 9Ressidance
and non residents duly registered on the territory of FEZ
will receive full or partial exemption from taxes and other
contributions during their operating in FEZ, if they are
directed into production on the territory of the RT. It
is expected that this law will come into force soon.
“On foreign investment in the Republic of Tajikistan
(RT) remains the main legal document that govern activity
of foreign investors. Foreign investments on the territory
of Tajikistan cannot be nationalized. Moreover, they cannot
be confiscated, apart from cases of natural disasters, accidents,
epidemics and other circumstances of emergency nature by
decision of the Parliament. In such cases investors shall
be compensated, which upon investors request, can be repatriated
enjoy a guaranteed right to repatriate profits and other
amounts in foreign currency abroad, provided that they have
been received legally from made investments. Profits received
ion the territory of RT can be reinvested in accordance
with investors request and in compliance with national legislation.
can open and maintain accounts in local and foreign currencies
in authorized banks of the RT, as well as abroad. Investors
may use founds accumulated in local currency accounts to
purchase foreign currency under of the prevailing legislation
with regard to purchase and sale of foreign currency.
investor stops its activity on the territory of the RT,
he has a right to receive compensations for his investment
and received profits in a monetary or commodity form at
real prices prevailing at the time of stoppage of investment
investors can us the following types of investments in the
economy of te country;
Equity participation in entities and companies jointly with
legal and physical persons;
• Establishment of companies, which are fully owned
by foreign investors;
• Acquisition of assets, including shares and other
• Acquisition of title to use land and other natural
reserves, as well as other proprietary rights independently
or with participation of local legal and physical persons;
• Enter into agreements with local legal and physical
persons, which provide for other form of foreign investments.
investor may also participate in privatization of assets,
which are owned by the state or communal authorities in
a manner provided for by prevailing legislation.
Government has created foreign investment legal framework
with regard to property and proprietary right, which can
not be less attractive that legal framework for local companies,
entities and citizens. Moreover, the government may provide
for additional tax and other preferences in priority areas
of economy and geographic regions.
and companies with foreign participation may engage into
any allowed by law of the RT. However, investors and companies
with foreign participation may engage in several type activities
upon receipt of special permit (license).
are also other legislation acts on foreign investments such
“On privatization of state property” and “On
joint stock companies”.