Economic Transformation in Central Asia: A Journey of Twenty-five Years

Abstract

Disintegration of the Soviet state was unanticipated in Central Asia and the new independent states were unprepared. The end of central planning in the late 1980s led to transitional recession and this got worse with the dissolution of the USSR. In this difficult situation, the five countries moved at different paces to stabilize their economies and establish market-based system. During transition era, Central Asian states introduced stabilization and structural reforms in the form of monetary policy, introduction of national currencies, price liberalization, privatization and fiscal reforms. Kazakhstan and Kyrgyzstan lead by introducing various reforms while Uzbekistan and Turkmenistan lagged behind and were slow reformers. Tajikistan was one state that suffered due to internal civil war. These stabilization and structural reforms produced mixed results for Central Asian states. Present study will provide an overview of the journey of 25 years of the five Central Asian states since independence, their experience with the reforms and their performance in the region.