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Andrey Dovletov
Professor Joseph Conlin
Advanced Expository 202
16 April 2002
Recently the Government of Turkmenistan announced improvement in the national economy. ... Turkmenistan remains a resolute one-party state with power vested in a communist-turned-nationalist leadership. One of the concerns, which international experts and opposition leaders continue expressing, is reform of the banking system. The banking system of Turkmenistan needs a rapid reform in order to speed up the development of an effective market economy in the country.
Turkmenistan became a sovereign state in October 1991, in the aftermath of the Soviet Union’s collapse. ... Unlike many of the former Soviet republics, Turkmenistan has not experienced any serious economic or political crises in the years since independence. ... At the same time, 80 per cent of Turkmenistan’s territory conserves huge deposits of oil and gas. Although Turkmenistan’s economic situation has deteriorated somewhat since 1990, the overall standard of living has not dropped as dramatically as it has in other former Soviet republics. ... (Turkmenistan: Back to the Communist Future). ...
The beginnings of reform of the nation’s banking sector were in 1992, when the existing state banks of Turkmenistan transformed into a network of commercial banks and began to develop. The initial goals included separation of the budget and banking spheres. In effect, in 1992 the establishment of a three-tier banking system took place in the country: the Central Bank, state banks (Vnesheconombank and Sberbank), and commercial banks. ... In the first half of the 1990’s, Turkmenistan slowly established independent fiscal and monetary institutions and policies to replace the centralized Soviet system upon which the republic had relied prior to independence. ... It is responsible for formulating and conducting monetary and foreign exchange policy, management of payment systems and supervision and regulation of the banking system. ... The Central Bank is responsible for granting bank licenses to foreign banks wishing to operate in Turkmenistan and for establishing and monitoring reserve requirements.
However, Turkmenistan’s banking system needs more changes for successful transition to market economy. According to the ex-chairman of the Central Bank of Turkmenistan Hudayberdy Orazov, the general economic situation continues to deteriorate. ... The Government of Turkmenistan (GOTK) has tightened fiscal and monetary policies and loosened foreign exchange and trade controls to try and correct some of the monetary imbalance.
Approximate Word count = 1909
Approximate Pages = 7.6
(250 words per page double spaced)
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