Minutes of the fifth meeting of the Consultative Council on improvement of investment climate under the President of the Republic of Tajikistan
(dated 28 April, 2010)

Chairman

President of the Republic of Tajikistan E. Rahmon

Members:

Prime-Minister of the Republic of Tajikistan O. Okilov

Chairman, State Committee on Investments and State Property Management of the Republic of Tajikistan- D. Saidov

Head of the EBRD Country Office Ulf Hindstrom

Director, United States Agency on International Cooperation (USAID) in Tajikistan - Jeffrey Lehrer

Chairman of the Association of Producers and Entrepreneurs Z. Saidov

Chairman of the Union of Entrepreneurs andExporters of Tajikistan N. Zabirov

Chairman of the Association of Banks of Tajikistan I. Lalbekov

Head of American Chamber of Commerce N. Sharipov

General Director of ‘’TT Mobile” G. Kayumov

President of «Tethys Limited» D. Robson

Head of Secretariat of the Consultative Council Z. Khotamov

Invitees:

State Advisor to the President of the Republic of Tajikistanon Economic Policy M. Davlatov

Senior Economic Adviser to the President of RT N. Buriev

Head of the Legal department of the Presidential Office D. Murodov

Minister of Economy and Trade Development of RT F. Khamraliev

Minister of Finance of RT S. Najmudinov

Head of the National Bank of Tajikistan Sh. Rahimzoda

Minister of Transport and communication O. Boboev

Chairman of State Geodesy and Land Reclamation M. Zokirov

Director of Agency for construction and architecture A. Komilov

Head of Economic Reforms and Investments Department Kh. Tagoimurodov

Head of Media-Services of The President of RT A. Sharifzoda

Deputy Head of State Committee for Investment

and State Property Management of RT Sh. Rakhmatboev

Head of Entrepreneurs Support Department of StateCommittee for Investment and State Property Management R. Emomali

Regional Director of the World Bank in Central Asia Moto Konishi

Country Director of ADB in Tajikistan Makoto Ojiro

Head of DFID Office in Tajikistan Bob Leverington

EBRD Director in Central Asia, M. Khonma

Project Manager, BEE Project in Tajikistan W. Werner

Deputy Head of UNDP Office in Tajikistan Z. Virani

The first item of the Agenda discussed in the Session was consideration of the Operational Regulation of the Consultative Council on Improvement of the Investment Climate under the President of the Republic of Tajikistan. With this regard, Emomali Rahmon, President of the Republic of Tajikistan, Head of the Council, pointed out that adoption of the Operational Regulation would help ensure efficiency of the activity of the Council, and instructed the Executive Secretary and the Council Secretariat to run the activity of the Council in accordance with the Regulation with a view to ensuring constructive cooperation with state agencies and businesses, and to undertake necessary measures to involve a broad range of the private sector representatives into the Council’s activity.

The main theme of the 5^th Session was discussion of the draft Plan of Further Measures of the Government of the Republic of Tajikistan for improvement of the investment climate and indicators of the Republic of Tajikistan in international rating and mechanism of its implementation, which was developed jointly by State Committee On Investment And State Property Management and Secretariat of Consultative Council on Improvement of Investment Climate under the President of Republic of Tajikistan with support of number of donor projects.

The Plan was prepared at the instruction of the President of RT – Emomali Rakhmon that was given during the 4th Council Meeting, where President instructed to prepare a plan for further reforms to improve the business climate in the country.

According to the preliminary projections, if the plan is implemented successfully, Tajikistan may improve its scores in five Doing Business Indicators, such as “Trading Across Borders”, “Getting Credit”, “Paying Taxes”, “Dealing with Construction Permits” and “Starting a Business”. Moreover, the plan envisages optimization of leasing procedures and development of short-term strategy for support of domestic producers that is expected to further improve business environment. It was informed that in one of the meetings of the Coordination Council of Business Associations of Tajikistan the participation of a broad range of the private sector representatives in implementation of the Plan was discussed.

Furthermore the representatives of the private sector made recommendations in the following areas during their speeches:

· Improving effectiveness of the leasing operations and long term sources for budget revenues as a result of import of technology through leasing. At the current stage during the import of technology and equipment through bank loan the equipment is exempted from VAT, while VAT is charged for the import of equipment under leasing. This situation creates barriers for the development of long-term leasing loans and import of modern equipment via leasing and establishment of production facilities.

· Support of domestic producers. It was suggested to include representatives from the Executive Office of the President of the Republic of Tajikistan, including specialists from the Legal Department, Economic Reforms and Investment Department, Finance Department and Industry and Energy Unit into the Permanent Commission for support of local producers under the Ministry of Economic Development and Trade of the Republic of Tajikistan with a view to ensuring efficiency of the operation of the above-mentioned Commission and agreeing draft legal and regulatory documents developed by this Commission with relevant government agencies in a timely manner.

· To arrange retraining courses for entrepreneurs, including entrepreneur surveyed by the World Bank.

· To develop and implement short-term and medium-term plans for the development of the domestic production reflecting specific reform measures without causing damage to the country’s economy.

· To exempt import of modern technology via leasing from VAT.

The third point of the agenda was to approve the draft agenda of the Consultative Council’s sixth meeting.

On this point, Mr Davlatali Saidov, the Council Executive Secretary, made a report, where he pointed out that since the President of the Republic of Tajikistan announced 2010 as the “Year of Education and Technology”, it would be reasonable to discuss the issue of “Introduction of modern information and communications technology for the development of electronic trade”, and importance and advantages of electronic governance at the next meeting of the Council.

The Council’s Executive Secretary asked the Council Chairman to promote establishment of a working group for development of materials for the sixth meeting of the Consultative Council out of representatives from relevant ministries and agencies and the private sector with the support of donor organizations taking into account the above-mentioned points.

DECISIONS AND RECOMMENDATION OF THE COUNCIL MEETING

(According to the minutes from April 28, 2010.)

· To approve the Operational Regulation of the Consultative Council on improvement of the investment climate under the President of the Republic of Tajikistan, and the Council’s Executive Secretary and its Secretariat should run the activity of the Council in accordance with the Regulation with a view to ensuring constructive cooperation with state agencies and businesses and should promote the involvement of a broad range of the private sector representatives in the activity of the Council and should ensure strict observation of the Operational Regulation.

· The Government of the Republic of Tajikistan should:

- approve the Plan of further measures of the Government of Tajikistan on improvement of the investment climate and the indicators of the Republic of Tajikistan in the International rating within the determined procedures and take necessary measures jointly with relevant ministries and agencies and the private sector with the involvement of the donor organizations with a view to implementing the Plan’s provisions;

- establish a working group according to provisions of the Plan of measures, to develop draft legal and regulatory documents and to submit for the consideration and approval of the Government of the Republic of Tajikistan within the shortest period of time in accordance with the Operational Regulation of the Government.

- to include representatives from the Executive Office of the President of the Republic of Tajikistan, including specialists from Legal Department, Economic Reforms and Investment Department, Finance Department and Industry and Energy Unit into the Permanent Commission for support of local producers under the Ministry of Economic Development and Trade of the Republic of Tajikistan with a view to ensuring efficiency of the operation of the above-mentioned Commission and agreeing draft legal and regulatory documents developed by this Commission with relevant government agencies in a timely manner.

· The State Committee for Investment and State Property Management of the Republic of Tajikistan jointly with the Secretariat of the Consultative Council should coordinate the activity of working groups and provide detailed information about the process of implementation of the Plan of measures to the Government of the Republic of Tajikistan on a regular basis.

· To identify priority indicators of the World Bank “Doing Business” International Rating and to assign relevant sectorial ministries and agencies responsible for their improvement with involvement of the private sector.

· Business Associations are recommended to undertake necessary measures with a view to enhancing the retraining of entrepreneurs with the financial support of international organizations.

· To approve the Consultative Cuncil sixth meeting’s agenda on the issue of “Development of information and communications technology for the development of electronic trade”.

· With this regard, the State Committee for Investment and State Property Management of the Republic of Tajikistan should establish a specific working group out of representatives from relevant ministries and agencies, the private sector, including information and communications companies and the Consultative Council Secretariat, with a view to developing thorough analytic papers for the consideration at the Council’s sixth meeting.

· The membership of Matluba Uljabaeva, Head of National Associaation of Small and Medium Enterprise, should be terminated due to the end of her membership term and Gulmahmad Kayumov, Director general of the Company of “TT Mobile” should be selected as a Council member as a replacement.

· The Council Executive Secretary and the Secretariat should reconsider the issue of membership of Council members, whose term has finished and should undertake necessary measures to propose candidates for the Consultative Council membership in accordance with determined procedures.

Chairman of the State Investments and State Property
Management Committee of the Republic of Tajikistan - D. Saidov

Head of the Secretariat of the
Consultative Council on Improving Investment Climate
under the President of the Republic of Tajikistan - Z. Khotamov