At the International Forum on Attracting Investments in the Private Sector of Turkmenistan (IFT 2025), Artur Andrysyak, Country Director of the Asian Development Bank’s (ADB) Turkmenistan Resident Mission, reaffirmed ADB’s commitment to fostering private sector development in Turkmenistan.
ADB has been a key development partner for Turkmenistan for the past 25 years. In August 2024, the new Country Partnership Strategy (2024-2028) was approved, with the overarching goal of transforming Turkmenistan into a more sustainable, climate-resilient, and competitive economy.
Currently, ADB has two major investment projects in Turkmenistan worth a total of $625 million, focusing on energy and transport sectors.
Over the next five years, ADB will extend its support to the private sector, aiming to enhance economic competitiveness and promote diversification.
Overall approach includes:
- Strengthening economic competitiveness through diversification, and private sector and human development.
- Creating an enabling environment for the private sector, public-private partnerships (PPPs), and nonsovereign operations.
- Exploring innovative and transformational opportunities in nonsovereign operations
- Working with Government to resolve the outstanding issues related to the framework agreement which is a prerequisite for ADB to be able to provide financing to private sector directly in Turkmenistan
Ongoing and planned Interventions cover:
- Investments, policy reforms, and institutional development efforts focused on the financial sector, enhancement of the business climate, reduction of state-enterprise dominance, and adoption of international financial reporting standards
- Support for SMEs targeting export markets, banking sector capacity building, and support Turkmenistan’s WTO accession
- Support of the government efforts in advancing private sector participation and developing pilot PPPs
- Exploring opportunities for private sector financing
- Improvement of the business environment, analysis of the health and efficiency of SOEs, and studying public investment efficiency
- Support for establishment of Special Economic Zones and review oil and gas industry taxation.
ADB, in collaboration with the Government of Turkmenistan, is preparing the Building Capacity of SMEs Exporters Project aimed at diversifying the economy by promoting SMEs in non-hydrocarbon sectors. A key component of this initiative is a financial intermediation loan project, where the **State Bank for Foreign Economic Affairs of Turkmenistan (SBFEAT) will channel ADB funds to private sector SMEs, ensuring adherence to sound banking principles. This funding will support medium- and long-term capital investments, with a primary focus on export promotion.
Advancing Public-Private Partnerships (PPPs) in Turkmenistan
While Turkmenistan has successfully attracted FDI in the oil and gas sector, there remains significant untapped potential in other industries. While the Government can continue the traditional approach to foster foreign investments, it can boost FDI by using Public Private Partnerships (PPP).
The new PPP Law provides an opportunity to attract foreign direct investment through PPP contracts.
Establishing contract-based PPPs will foster the adoption of international standards in project finance, which builds investor confidence and encourages FDIs further.
ADB remains committed to supporting Turkmenistan’s economic diversification and private sector growth. By fostering an enabling business environment, strengthening SMEs, and advancing PPP initiatives, ADB is playing a crucial role in transforming Turkmenistan into a more competitive and resilient economy. The next five years will be pivotal in achieving these goals, paving the way for a stronger and more dynamic private sector in the country.
ADB’s Lending Pipeline for Turkmenistan for 2025 and 2026–2028
- Improving Nursing Quality and Capacity Project
- TransTurkmenistan Railway Modernization Project (Phase 1, Ashgabat–Dushak)
- Climate Resilient Water Resources Management
- Building Capacity of SME Exporters
- Renewable Energy and Energy Efficiency Project
- National Power Grid Strengthening (additional financing)
- TAPI Gas Pipeline (Phase 1)* (TAPI project on standby due to ADB’s hold of operations in Afghanistan)
- Support for Urban Development
- TransTurkmenistan Railway Modernization Project, (Phase 2, Mary–Dushak)
- Professional Education for Tourism and Services Project
- Building Capacity of SME Exporters Project (Phase 2)
///nCa, 18 March 2025