Value Chains research report Tajikistan final - Microfinance Centre

number of new players will appear. Using VCF at this stage is a strategically correct
approach in the conditions where MFOs can increase their clientele and better utilize
their capacity to facilitate the development of the national economy. According to MBB 3 ,
the penetration of financial sector in Tajikistan is lower than in most countries of the
world.
5. Agricultural VC in the country, in which microfinance
can add value.
In accordance with the terms of reference, we recommend 10 value chains in which
microfinance can add value by strengthening the operations of the actors between the
producer and consumer. As per the criteria provided, all value chains presented include
opportunities for development. Initially it was assumed that production of cotton was the
best VC. However, we decided not to include the cotton value chain into this list, for the
reasons below:
• A lot of analytical information has already been produced for this commodity,
including value chain analysis;
• MFOs have little involvement in cotton production;
• Cotton is a strategic commodity for the country, and its value chain is under the
patronage of the government and international investors;
• International donors pay a lot of attention to unfair profit distribution during the
production and processing of cotton;
• The price of cotton is prone to fluctuations.
We have included ten products, which currently meet the criteria defined by MFC and
also look interesting from our viewpoint.
• Relevant on Tajikistan
• Market potential (internal and external: Export oriented OR Import substitute)
• Market accessibility and stability
• Transparent market requirement
• Growth opportunity
• Outreach be farmers/ household involved
• Impact
• Enabling environment.
• Grow and produced in areas where MFIs provides their services
If necessary to expand the list, we would add production of apples, vegetables, and
poultry farming. In our opinion, increasing production of wheat is not recommended, as
our production cannot compete with Kazakhstan by quality, yield, price or any other
parameter. Tajikistan imports most of its wheat from Kazakhstan, and we believe it is
reasonable and each country must be using its competitive advantages.
3 MBB - MicroBankingBulletin.
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