TAJIKISTAN CAN'T BE CONSIDERED AS A "FREE
COUNTRY"
"When there are too many inhibitive
laws in the country, the people become poor. When laws and
orders increase in number, the quantum of thieves and robbers
enhances". Lao Tzy, Dao de tzin. V-th century B. C.
Three fundamental
reports are published in 2003 ranging world countries pursuant
to such criteria as human development index, economic freedom
and corruption level. In spite of outward distinctions of these
criteria they give rise to serious contemplations over the shaping
tendencies as to economic development of countries. Regretfully,
the ratings over Tajikistan don't evoke optimism.
The Criteria Society
Freedom Is Measured by
Our reference to the report published
1. The annual report "Index of Economy Freedom"
is composed by "Heritage" American fund and "Wall
Street Journal" leading world edition on economy. In
order to qualify economic freedom and a respective rating
of a separately taken country international experts used 50
independent variables which being classified are presented
in the term of 10 basic components of economic freedoms: trade
(Tajikistan rating - 3 points); taxation and money (5.0 points),
policy, owner's rights protection (4.0 points); level of state
interference into economics (3.0 points); stat of bank and
financial sector (4.0 points); investitive climate (4.0 points)
and state of "black market" (5.0 points). Each of
the components is assessed on five-points-scale. Hereby, "1
point" means maximal economic freedom and "5 points"
- minimal one. An index range of economic freedom for each
country was computed as the arithmetic average of all components;
there were singled out four categories of countries: free
- countries with average index significance up to 1.95; basically
free - countries with average index significance in the range
of 2.00-2.95; basically non-free - countries with average
index significance in the range of 3.00-3.95; with repressed
economy - countries with the index more than 4.00.
Out of 156 countries information was systematized on, Tajikistan
took the 143rd place; international experts qualify its economy
as "basically non-free". 2. "Report on Human Potential Development"
is prepared and published by UNO. Human development index
is computed for each out of 175 countries included into the
report and all states are divided into three conventional
groups: 1 - countries with high development standard (55 countries);
2 - countries with middle development standard (86 countries)
and 3 - countries with low development standard (34 countries).
Tajikistan is referred to the second group with the lowest
indicator, among the former USSR countries; it took only 113rd
place in general rating. 3. In the annual published report of "Transparency
International" non-government organization dwelling on
corruption level in 133 countries ten-points-scale was used.
Thus, 10 points mean complete absence of corruption and 1
point testifies to absolute evincement of this vice. Tajikistan
took only the 5-th place from the end with the result of 1.8
points; it left behind only such exotic countries as Myanmar,
Haiti, Nigeria and Bangladesh.
After the reports had been published we made an analysis of
the economic situation and an assessment of separate streamlines
in regard to economic reforms in Tajikistan; hereby, we tried
to answer the question: why are ones states heightening their
welfare from day to day and thriving, but others - on the
contrary - are rolling down deeper and deeper into the abyss
of penury and corruption? What ought to be done in order people's
living standard gradually improved and, in general, what does
free economy mean for the future of Tajikistan?
Why Are ones States
Poor whereas others Are Rich?
The basic factors preconditioning a wealth
level of these or those countries are imputed more often to:
convenient (or inconvenient) geographical location of a country;
availability (or non-availability) of valuable natural resources;
political (financial or any other) dependence on other countries;
population's educational standard and a whole number of other
factors including demography, culture and even religion. We
can deliver a considerable number of examples when ones countries
have all the advantages, but others, which have practically
nothing, ensure a steady rise of economy. For example, South
Korea and North Korea whose economies and welfare standards
are incomparable in spite of common geographical location
and other qualifying factors.
Factors adduced for explanation of divergences in economic
development of countries don't afford to predict potential
tempos of prospects either. Thus, in 1913 the Philippines
was the richest Asian country. In 1960 it was ahead of Taiwan
and South Korea on per capita income, but at the end of the
XX-th century the Philippines already fell behind Japan 7
times, behind Taiwan - 6 times, South Korea - 4 times.
Tajikistan as a country of fairly high economic potential
remains, to our deep regret, one of the poorest countries
for today with the highest corruption index and low human
development level. But what are the fundamental reasons accounting for today's
economic state of Tajikistan?
Many people, and governmental officials especially, put down
the present economic state of Tajikistan to heavy consequences
of the military-political conflict, dearth of energy resources,
negative political-economic sway on the part of separate neighboring
states, non-availability of immediate reach of seas and etc.
Of course, all these things really take place, however, these
reasons are not fundamental in order to account for the shaped
economic situation and that sweep of corruption, which is
marked in Tajikistan by international experts. One can find
an answer to the question if to recall the classical treatises
by Adam Smith. This great economist qualifies the main principle
of efflorescence in reference to the state and its citizens
seeing in economic freedom; he formulates the basic provision
of economic policy which runs to the following effect: the
less the state is engaged in economy the better it is for
the latter.
The state of Tajik economy is characterized in "Heritage"
fund report and "Wall Street Journal" as "basically
non-free"; this appraisal correlating completely with
human development index and corruption level in the country.
Laws, edicts and other instruments published by managerial
bodies of all levels are prepared in order any solution in
regard to economy depended in the long run on officials; this
factor alongside with low wages of the latters is a basis
for development of corruption in Tajikistan. Under these conditions
any state organ bound to crate a favorable environment for
economic development converts inevitably into the organ of
regulation and control. So, economic relations became non-free
and corruption spreads widely.
Analyzing the data of the published reports one can do an
important inference: the freer the economy of the country
is, the higher will be human development standard and GDP
indicator (gross domestic product) computed per capita, the
lower will be corruption level.
For today Tajikistan is an extremely poor state with non-high
human development standard and sweeping corruption because
economy is not free in a wide sense of the word. However,
a chance to rectify the situation shaped is available. Today
Tajikistan lives without great economic and social shocks;
minor economic accretion (according to the authors' appraisal)
is observed. The government must take advantage of this chance
and demonstrate political vigor to the effect of ensuring
strategic triunity: effective law-abiding state, free private
economics and individual freedom.
What Ought to Be
Undertaken to Make Economy Free?
The notion of "economic freedom"
is based first of all, on private property immunity, the freedom
to produce, trade, preserve and use the produced an the earned,
to invest without limitations, to enter necessary economic
contacts, to fix prices and utilize mutually concerted forms
of accounts on transactions. Direct employment of the principles
of economic liberalism afforded many countries of the world
to achieve rebirth and accretion of their economics irrespective
of geographic situation, natural resources and states they
border on. Such countries as Italy, Germany, Japan, Taiwan,
Chile, Ireland, China and many others exemplified unprecedented
tempos of economic growth, heightened living standard and
life quality of their citizens, reduced corruption and availability
of the achievements of globalization for their population
in the second half of the XX-th century. Any attempts to
build up effective economy on the principles of pressure,
protectionism or populism are doomed to failure. No example
can be delivered when non-free economics and non-liberal approach
to its regulation would have brought a positive result in
any country.
As for Tajikistan, here economic reforms were carried out
extremely non-consecutively and unjustifiably slowly. The
frameworks of state management strive, first and foremost,
for effectuation of controlling, permissive and planning functions.
Their activity doesn't differ greatly from that one they performed
at the initial stage of economic reforms in early 90-ies.
The economic policy pursued in the country is utterly inertial,
it doesn't take into consideration quickly changing realias.
All this withholds essentially the development of entrepreneurship
in the country impeding an influx of investments.
If in developed countries one can register a corporation or
any private business for several minutes why can't it be done
in Tajikistan? Why should we, when exporting cotton, for example,
deal with a huge number of organizations (stock exchange,
bank, statestandard, custom's house, taxation department and
what not) which putting stamps and entering notes into registration
lists only hamper business; into the bargain, they collect
monetary dues being of no sense at all. Hereby, cotton production
according to the laws of Tajikistan can be realized only at
the prices no lower than the world prices. What is it? Is
it a potent reluctance to make economy free and more transparent
or non-understanding of negative results of such schemes of
business organization? It stands to reason that we don't imply
a complete refusal from control on the part of the state.
The latter should effectuate certain controlling functions
but their organization should be tactful and non-encumbering
for business.
"The role of the government lies not in creation of values,
but in creation of a certain environment in which a middle-sized
or minor entrepreneur can run his own business and thrive",
- this is the statement done by the USA president George Bush
during his visit to Saint Petersburg. For this, he emphasized,
one should "respect private capital, remove all sorts
of whimsical administrative restrictions, create fair laws
for banks and bankers and have good taxation policy".
It is also necessary to acknowledge that the state apparatus
constructed in Tajikistan is too big and few effective or
- to apply an imagery locution - "there are too many
excessive people occupying excessive positions". Therefore,
in order to make economy free, to our mind, the next things
need to be done:
- To cardinally reconsider the goals and functions of the
government and its institutions from the point of view of
the necessity of liberalization of economy;
- To maximally reduce all controlling and permissive functions
of the state apparatus, to diminish its numerosity and the
expenditures for its maintenance;
- to cancel all departmental instruments restricting economy
development and to urgently reconsider the functioning legislation
under the angle of ensuring maximal economic freedom in the
country.
As soon as these goals are transferred into an economic plane
and start to be solved, economic relations in Tajikistan will
become more transparent, economy will be freer, corruption
level will reduce and investitive attraction will enhance.
What Does Free Economy
Mean for the Future of Tajikistan?
If Tajikistan is going to turn into a rich
and thriving state in future, a new ideology based on universal
development of economic freedom and democracy should be formed
already today. Any steps towards liberalization of economy
will be inevitably promoting an extension and reinforcement
of democracy in the country. These two fundamental concepts
are inseparably connected being a strategic ground for building
up a free and economically developed state in future. Moreover,
taking into consideration the situation shaping in Central
Asia, the development of free economy and extension of democracy
will become a reliable insurance policy against an origination
of future hotbeds of terrorism and religious extremism.
We would like to adduce once more the words of great Adam
Smith that in order to raise the state to the supreme stage
of welfare. "… one needs only peace, non-crippling
taxes and tolerance in management; natural course of things
will be all the rest".
By N. Fahri and K. Ahmedov
(Al Ajdad Consulting, Canada)