Legal Market Overview
Tajikistan was significantly affected by Covid-19 in 2020, with growth slowing to 4.2%, as reported by The World Bank. Due to a global slowdown in the markets during the early parts of the pandemic, there was an expected drop in consumer demand and reduced inbound investments. In response, the Tajikistan government injected spending into healthcare, deferred tax collections and eased monetary policy, all to help both the health of its citizens and its economy. Additionally, it followed up on its promise to increase public sector wages and pensions.
In October 2020, the Tajik presidential elections were held without major incident, with a fifth straight victory for incumbent Emomali Rahmon of the People’s Democratic Party, securing over 90% of the vote and continuing in the office he has held since 1992. Consistency in leadership has not necessarily meant ossification of policy however, with the détente first introduced in 2018 between Tajikistan and Uzbekistan remaining a significant improvement in international relations..
While there may have been a slowdown in international investment, especially from China, there remains an interest from foreign investors in the green energy sector, as well as in infrastructure, which the government has capitalised on in recent years. China’s long-term goals of increasing its soft power in the CIS region through investment in transportation, mining, and infrastructure are not likely to end permanently.
Hydropower remains a particular area of interest for foreign investors, as the country is rich in water resources, and its major exports continue to include aluminium and cotton. However, a majority of the corporate business sector continue to be run by state-owned utilities.
The legal market remains small, with local firms collaborating with CIS-region-specific firms to advise on major PPPs and construction projects in the energy and natural resources sectors, such as Akhmedov, Azizov & Abdulhamidov, Attorneys. For cross-border corporate, finance, and M&A projects, firms such as Centil Law and GRATA International are first ports of call for international investors.