Russian Sanctions, Tajik Remittances, and Chinese Investment

By Michael Jacobs

While the situation in Ukraine and its effect on the Russian and European economies have been the subject of countless news stories and op-eds for several months, the implications for the former soviet countries in Central Asia have largely been ignored. One of these countries in particular, Tajikistan, may face the most severe and direct consequences of a Russian economic slow-down.  This outcome looks increasingly likely as falling oil prices amplify the negative impact of economic sanctions in energy-dependent Russia.

Tajikistan, however much it may depend on the Russian economy now, isn’t waiting around to find out what would happen if the Russian economy falters. Tajikistan recently accepted an offer of $6 billion in new investments from China over the next 3 years, which is part of a larger Chinese push into Central Asia. China may use this investment to build oil refineries and has already built numerous cement factories in Tajikistan in recent years as Chinese workers have contributed to a construction boom in Tajikistan’s capital, Dushanbe. These cement factories have also led to some speculation that in the future China may look to fund the completion of the controversial Rogun Dam, which began construction in 1976 and saw work suspended in 2012. The graphs below illustrate Tajikistan’s dependence on Russia as well as the magnitude of China’s recent investments. As a note, comparisons with China’s investment assume $2 billion are invested each year ($6 billion total investment divided evenly over 3 years).

1.  Tajikistan is the Most Remittance-Dependent Country in the World

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Ukrainian Activist and Pop-Star Ruslana Lyzhychko at CSIS

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Ruslana spoke at CSIS on September 10

Who is she?

Ruslana became a prominent figure in the Euromaidan movement through her nightly performances on the front lines of the protests. She currently leads efforts to support internally displaced persons from Crimea and the Donbas and performs for Ukrainian troops in Eastern Ukraine. In January 2014, Ruslana testified at the European Union’s European Economic and Social Committee (EESC), which contributed to a resolution in support of Ukrainian civil society. Ruslana has traveled throughout Europe to increase international support and awareness of events in Ukraine. She previously served as a Member of Parliament for the Our Ukraine party from 2006-2007 and was actively engaged in the 2004 Orange Revolution. Continue reading