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Turkmenistan reveals GDP growth rates

18 July 2016 13:36 (UTC+04:00)
Turkmenistan reveals GDP growth rates

By Nigar Abbasova

Gross Domestic Product (GDP) growth rates in Turkmenistan amounted to 6.1 percent in January to June 2016, the Ministry of Economy and Development of Turkmenistan reported.

The GDP growth in industry and the sphere of construction amounted to 2.1 and 4.4 percent respectively. The growth in the sphere of communication made up 9.9 percent while the growth in trade amounted to 16 percent in the reported period. The growth in agriculture and sphere of services was 6.9 and 9.7 percent respectively.

Growth rates of output have increased by 3 percent. Retail turnover has increased by 16.1 percent while the increase of average monthly wage amounted to 9.5 percent as compared to the same period in 2015.

Earlier, The European Bank for Reconstruction and Development (EBRD) forecast GDP growth of Turkmenistan at the level of 6.5 percent and 7.1 percent in 2016 and 2017 respectively. The bank's experts noted that the growth of Turkmen economy was 6.5 percent in 2015, as compared to 10.3 percent in 2014. GDP in Turkmenistan slowed in 2015 compared due to declining natural gas export and lower public investment. Russia bought just 4 billion cubic meters of gas in 2015 compared to 40 billion cubic meters in 2008. The country stopped importing gas from Turkmenistan in 2016.

The improvement which is expected in 2017 is linked to the fact that the country is a largest exporter of energy raw materials.

GDP growth of Turkmenistan in the next three years (2016-2018) is forecasted at 5 percent, according to the Global Economic Prospects, June 2016 of the World Bank (WB).

EBRD report said that the risks include continuing political tensions, as well the possibility of a sharp deceleration in growth in China, as well as a prolonged weakness in commodity prices and a possibility of further drop in the price of oil. Recession in Russia and weak commodity prices are considered to be the main features that put pressure on the economies of Central Asia.

Profitable part of the state budget was implemented with the volume of 8.1 billion Turkmen manats ($2.30 billion) while non-profitable part was executed by 8.6 billion manats ($ 2.44 billion) in the first half of 2016. As much as 78.7 percent of budgetary funds were allocated for the development of social sphere in the reported period.

Profitable part of the state budget is mainly formed due to the spheres of oil and gas, energy and construction. The country takes measures to develop the agricultural sector, the sphere of transport and communications as well as textile and food industry.

Turkmen state budget revenues in 2016 are expected to amount to 102.479 billion manats ($ 29.134 billion) while expenses will be 104.879 billion manats ($29.816), according to the state budget for 2016 which was adopted by the the Majlis (Parliament) of Turkmenistan.

The state budget of the country for 2016 is aimed primarily at maintaining the stable growth of the national economy, implementation of major investment projects, widespread introduction of innovative technologies, latest achievements of science and technology in all spheres, as well as providing high efficiency of public spending.

Turkmenistan holds one of the key positions in the region on natural gas supplies. The country ranks fourth in the world in terms of the volume of natural gas reserve, according to the BP report.

Ashgabat pursues the policy of economic diversification. The country devalued its national currency, manat, in January 2015, reduced the investment spending and subsidies and strengthened the regulation and supervision over the banking sector.

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Nigar Abbasova is AzerNews’ staff journalist, follow her on Twitter: @nigyar_abbasova

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