Economic Outline

flag Turkmenistan Turkmenistan: Economic Outline

Economic Indicators

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Turkmenistan is a predominantly desert country, sparsely populated (population density is ten people per square kilometre), and its economy depends mostly on agriculture (mainly cotton), oil, and natural gas (fourth-largest natural gas reserves in the world, representing about 10% of global reserves). Turkmenistan's economy enjoys regular revenues from hydrocarbons and limited exposure to international financial markets. GDP growth turned negative by 3.4% in 2020 as a consequence of the COVID-19 global crisis, a contraction in private consumption and reduced services turnover. In 2021 the economy rebounded (+4.5%) fuelled by increased demand for oil and gas and improved global prices as well as by record wheat harvests that boosted the agricultural sector. The IMF projects growth at 1.7% in 2022 and 2023, as private consumption and the services sector are expected to grow by 5% (Coface).

Concerning public finances, thanks to increased gas export revenues, the budget balance was in surplus in 2021 (0.4%), with a forecast of +0.1% for 2022 (Coface). Such performances should allow for the timely repayment of obligations relating to the country’s external debt, which is almost fully sovereign. The debt-to-GDP ratio is low, at 27% in 2021, and it is expected to follow a downward trend in the forecast period (23.6% this year, 22.1% in 2023 - IMF). Inflation was driven by import restrictions and the resulting shortages, particularly for foodstuffs. The government is trying to control inflation (at 12.5% in 2021) by limiting the amount of cash in circulation and maintaining the official exchange rate at TMT 3.5 per USD. Other measures include price controls and the distribution of some foodstuffs at subsidised prices. However, inflation is expected to accelerate to 13% this year, before easing to 10% in 2023 (still above its pre-pandemic level). Despite its status as a middle-income country, Turkmenistan is still at an early stage of transition to a market economy, requiring reforms such as price and trade liberalization, privatization and the creation of market regulatory institutions. The public sector and state monopolies continue to dominate the economy and the informal labour market is important. Strict administrative controls and the important role of the public sector in economic activity remain the main obstacles to private sector development. Overvaluation of the Turkmen manat and foreign currency rationing dampen foreign investment and reduce the competitiveness of non-hydrocarbon exports. President Berdymukhamedov holds power since 2006: in what has been seen as a move to consolidate his power, from January 2021 the Parliament transitioned from unicameral to bicameral after a constitutional reform.
 
Official data on poverty and unemployment are questionable and dated, whereas the proportion of the employed population below USD 1.90 a day (PPP) in 2019 was 7.6% as per the Asian Development Bank. According to figures from the World Bank modelled on estimates from the International Labour Organisation, the unemployment rate rose to 4.4% in 2020, from 3.7% a year earlier (latest data available). About 90% of the active population is employed in the public sector.

 
Main Indicators 20202021 (e)2022 (e)2023 (e)2024 (e)
GDP (billions USD) 53.19e62.2074.4482.3789.56
GDP (Constant Prices, Annual % Change) -3.04.61.22.32.4
GDP per Capita (USD) 810111313
General Government Gross Debt (in % of GDP) 13.111.18.46.85.9
Inflation Rate (%) 7.615.017.510.57.5
Current Account (billions USD) -1.760.391.832.041.44
Current Account (in % of GDP) -3.30.62.52.51.6

Source: IMF – World Economic Outlook Database - October 2021.

Note: (e) Estimated Data


 
Monetary Indicators 20162017201820192020
Turkmenistan Manat (TMM) - Average Annual Exchange Rate For 1 MUR 0.100.120.120.100.09

Source: World Bank - Latest available data.

 

Main Sectors of Industry

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 20.7 39.8 39.5
Value Added (in % of GDP) 10.8 42.0 47.2
Value Added (Annual % Change) 14.0 29.3 13.6

Source: World Bank - Latest available data.

 

The Active Population in Figures

201820192020
Labour Force 2,348,3692,380,5962,360,858

Source: International Labour Organization, ILOSTAT database

 
201720182019
Total activity rate 61.29%61.25%61.20%
Men activity rate 75.44%75.43%75.41%
Women activity rate 47.66%47.57%47.49%

Source: International Labour Organization, ILOSTAT database

 

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Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:
47,4/100
World Rank:
167
Regional Rank:
37

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 
 

Country Risk

See the country risk analysis provided by Coface.

 

Indicator of Political Freedom

Definition:

The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Ranking:
Not Free
Political Freedom:
7/7

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House

 

Indicator of Freedom of the Press

Definition:

The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:
178/180

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Sources of General Economic Information

Main Online Newspapers and Portals
Turkmenistan Newspapers and News Sites
EIN News - Turkmenistan
State News Agency of Turkmenistan
BBC News - Turkmenistan
Turkmenistan News
Useful Resources
Government of Turkmenistan
Ministry of Foreign Affairs
Central Bank of Turkmenistan
 
 

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Latest Update: October 2022