During the month of November, Tajik somoni has dropped by 4%, National Bank of Tajikistan (NBT) reported. Analysts say this change will continue as Russian ruble devaluates, because Tajik economy heavily depends on money transfers from Tajik migrants in Russia.

Tajik somoni has dropped by 7% since the beginning of the year, and by 4% since the beginning of November. Local media started expressing concerns about further devaluation of somoni, but NBT is asking people not to panic.

High Prices

Replying to Silk Road Reporters’ inquiry, the NBT said that anti-Russia sanctions are to blame for devaluation of somoni.

“Russia is the main trade partner for Tajikistan, Tajikistan also imports many goods from Russia. This is why we are experiencing such a devaluation of our currency. The panic among Tajik citizens has caused increase in prices (often artificial), but we would like to announce that this is a temporary trend. Tajik somoni will stabilize soon.”

In the meanwhile, prices went up significantly in November, several Dushanbe residents told Silk Road Reporters.

“If a week ago one liter of gasoline was 3.20 somoni, this week it is 3.50. Vegetable oil went up from 13 to 15 somoni, one flour package – from 145 to 160 somoni. Everything is getting expensive, and they (the authorities) are telling us not to worry. How can we not worry, what if the prices will keep climbing up,” Aynura Soyorova, Dushanbe resident, says.

Money Transfers from Russia

“Over 50% of Tajik GDP comes from money transfers to Tajikistan from Russia-based labor migrants, and this explains why Tajik economy is suffering right now, “says Saimiddin Dustov, head of Tajik Analytical Center.

“Most migrants get paid in rubles, and because the value of rubles has dropped significantly, migrants send home less money. As a result Tajik banks get less money, and this leads to devaluation of somoni. The government is talking about a slight somoni devaluation (2-3%), but independent analysts say it’s closer to 15%,” he adds.

“My son is sending me money from Russia, where he works, every month. He used to send me about 150 dollars a month, but now it’s just a hundred, “ Bibisharif Mirzoyeva, mother of a Tajik migrant in Russia, says.

Support for Somoni

The government has promised to introduce certain support measures for Tajik somoni. The NBT has released additional funds to artificially support somoni.

But Tajik economist Shuhrat Ramazonov says these measures aren’t effective.

“First of all, NBT’s funds are quite limited, and second, the International Monetary Fund doesn’t recommend such measures. A better way to support somoni and Tajik economy overall would be to make sure our export numbers increase. Currently we import three times more than export goods. This is why our economy is so much dependent on foreign currency (ruble). Increasing export numbers will help our economy.”