The last session of the Turkmen government was focused on economic issues, particularly the development of private enterprise. This is something new for Turkmenistan and may be giving some cause for optimism. So far, the authorities have barely dealt with this issue, instead concentrating on the state entrepreneurship.

During the meeting, Turkmen President Gurbanguly Berdimuhamedov said the government aimed at increasing the private sector’s share of GDP up to 70% “without taking into account the performance of energy and other strategic sectors of the national economy.

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The head of state noted the importance of working out a special programme with a view to developing entrepreneurship until 2020 which would “enjoy full state support.” Gurbanguly Berdimuhamedov urged relevant ministries and organizations, as well as local authorities to provide comprehensive assistance to small and medium businesses. The president said it was important to take inventory of the existing legislature with the aim of removing unnecessary administrative barriers in licensing, holding various registration processes and concession activities, attracting foreign investments, developing free economic zones and privatization.

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The president also signed the law “On foreign investments” (revised edition), the law “On amendments to the Tax Code of Turkmenistan”. Apart from that, the ministry of justice has been given three months to prepare a package of documents for the registration of the Association of Manufacturers and Entrepreneurs of Turkmenistan.

The president’s declarations and announced actions seem to confirm that Berdymukhammedov is indeed planning to carry out economic reforms, intended to bring the Turkmen economy closer to the market model. These reforms are aimed at creating favorable conditions for foreign investments and adjusting the economic system to interaction with the world. However, the actions planned do not intend to expand political liberties.

At the moment there is a number of restrictions that discourage potential investors and hinder the development of private enterprise. Annadurdy Khadjiev describes them in great detail in his article published by the Institute for War and Peace Reporting. Khadjiev writes that a great part of the Turkmen law is self-contradictory, the letter of the law is largely irrelevant and domestic courts are not independent arbiters. Another serious problem is corruption among state officials. All this makes investing in Turkmenistan a risky business. Only those companies, who have been granted a private audience by the president and got his “blessing”, take this risk. I recommend the mentioned article to all those who are interested in Turkmenistan’s economic problems.