AMCHAM TAJIKISTAN June August NEWSLETTER · Ministry of Economic Development and Trade (MEDT). MEDT...

NEWSLETTERAMCHAM TAJIKISTAN June-August

IN THIS ISSUE:

Social Entrepreneurship Program for students f r o m C e n t r a l A s i a "Innovate for Change 2016"

Business breakfast on business, trade and investment opportu-nities in Afghanistan

U. S . C h a m b e r o f Commerce Reception with Sec. Ernest Moniz and Foreign Ministers from Central Asia

IFC: DevelopingEmerging Markets

Happy Independence Day

TAJIKISTAN!

AmCham News

One of my top priorities as U.S. Ambassador in Tajikistan has been to increase economic stability by working with representatives of the Government of Tajikistan, members of the local private sector, and my counterparts from other embassies and international organizations. Together we are promoting economic reforms, encouraging trade with neighboring countries, and exploring new ways to improve the business and investment climate in Tajikistan. I know that AmCham Tajikistan has played an important role in these efforts, and I want to thank you for your continued support of the Chamber of Commerce.

NEWSLETTER | www.amcham.tj | 03

Today we celebrate 25 years of Tajikistan's independence – and within a few months, 25 years of diplomatic relations between our two countries. AmCham member companies have contributed so much to Tajikistan – not only increasing its economic prosperity, but also helping to grow the people-to-people ties that connect our planet. Every day we will continue to work to promote greater regional prosperity and stability, with Tajikistan linking Central Asia with South Asia and beyond. Happy Independence Day!

U.S. Ambassador Elisabeth Millard

On the occasion of the 25th

Anniversary of Tajik Independence:

a message from U.S. Ambassador

Elisabeth I. Millard

Reception

at Sheraton

Dushanbe Hotel

On June 7th, AmCham Tajikistan took part in the farewell of the general manager of Sheraton Dushanbe Hotel, Mazen Kaddoura. Guests gathered to pass their well-wishes along to Mr. Kaddoura and to welcome the new general manager, Mr. Toni Toshev.

AmCham News

04 | www.amcham.tj | NEWSLETTER

On June 16th, AmCham Tajikistan had the honor of participating in the Final Study Results Workshop on Inclusive Business – New opportunities for Growth and Poverty Reduction in Tajikistan, held by the Asian Development Bank (ADB) in the Dushanbe Serena Hotel. The workshop opened with welcoming remarks by Mr. Ilyosiddin Kamolidinzoda, Deputy Minister of Economic Development and Trade of the Republic of Tajikistan (RT), and was followed by ADB Principal Economist Armin Bauer's presentation on the importance of inclusive

1business (IB) in Tajikistan and ADB's strategy for IB. ADB consultant Markus Dietrich then presented the results of the first market-scoping study on IB in Tajikistan. Notably, Tajikistan is the first country in the region to be exposed to the emerging concept of IB. The study was presented by ADB's team of consultants at the request of Tajikistan's Ministry of Economic Development and Trade (MEDT). MEDT views IB as an innovative approach to private-sector development, which has the potential to overcome key barriers in the country to creating new jobs and income opportunities and deliver essential and affordable goods and services, especially to low-income groups (ADB, 2016).

The first workshop session included presentations from companies that the study identified as potential IB models—ASR Leasing, Oro Isfara, Pamir Energy and Neksigol—and a question and answer session. Session two was a panel discussion with representatives of development organizations such as IFC, GIZ and AKDN. The session was moderated by Bahodur Sheraliev, an ADB consultant, who posed questions to the development organizations about their financing, investing, and the creation of strategies and visions for inclusive business in Tajikistan. The organizations shed light on steps taken to contribute to the development of IB in Tajikistan.

The final session consisted of group discussions related to promoting IB in three different sectors: 1) agribusiness and

similar industries; 2) health, education, and utilities; and 3) tourism and finance. AmCham Tajikistan joined the third group, and actively participated in discussions about potential of IB in the above sectors and expressed its eagerness to raise awareness about the emerging concept of inclusive business among its member companies and other stakeholders. Each group's discussion was summarized by the three group moderators after all participants reconvened at the roundtable. Armin Bauer expressed his gratitude to the government officials for their interest and encouraging work on IB. He added some suggestions, including the establishment of a working group on IB within the Development Coordination Council, a proposal to pilot a Business Ombudsman institution and accreditation process for companies with an IB model, the creation of a special window in the Entrepreneurial Support Fund for IB companies, and including IB in governmental reform programs. The workshop ended with closing remarks by Zafar Burhonzoda, the Head of the Macroeconomic Analysis Administration, who thanked the ADB team for presenting the study results at the roundtable and the participants for coming and contributing to the event. The final results of the study will be presented to the government, development partners, business associations, companies, and civil society in October of this year.

ADB. 2016. “Market Scoping Study for Inclusive Business in Tajikistan, Summary of Findings for a National Workshop held on 16 June 2016 in Dushanbe.” In: Final Study Results Workshop on Inclusive Business – New opportunities for Growth and Poverty Reduction in Tajikistan. Dushanbe.

1ADB defines Inclusive Business as commercially viable companies whose core business model is to provide, at scale, innovative and systemic solutions for the poor and low-income populations. ADB's inclusive business initiative began in 2012, and it supports the development of an enabling environment for IB in its member states, as well as direct investments in companies with inclusive business models through its Private Sector Operations Department (PSOD).

Final Study Results Workshop on Inclusive Business – New opportunities for Growth and Poverty Reduction in Tajikistan

AmCham News


Happy Indepedence Day

The U.S. Embassy celebrated the 240th anniversary of United States' Independence Day on July 8, where AmCham Tajikistan member companies had the opportunity to participate. Invited guests included Governmental Officials, Development Organizations, and International Business community.

AmCham News


AmCham News

2016 CAMCA Regional Forum

On June 18th-19th, Tbilisi hosted the 2016 CAMCA (Central Asia, Mongolia, Caucasus and Afghanistan) Regional Forum, organized by the Rumsfeld Foundation in cooperation with the alumni network of the Rumsfeld Fellowship Program and the Central Asia-Caucasus Institute at the John Hopkins School of Advanced International Studies. The forum brought together over 160 representatives from more than 20 countries-including several AmCham Tajikistan members-to discuss key regional issues and trends.

U.S. Chamber of Commerce Reception with Sec. Ernest Moniz

and Foreign Ministers from Central Asia

To celebrate 25 years of independence in the post-Soviet

Central Asian states, the U.S. Chamber of Commerce

hosted a cultural reception in Washington, DC on

August 3rd with Dr. Ernest Moniz, U.S. Secretary of

Energy; Erlan Idrissov, Foreign Minister of the Republic

of Kazakhstan; Erlan Abdyldasev, Foreign Minister of

the Kyrgyz Republic; Sirodjidin Aslov, Foreign Minister

of the Republic of Tajikistan; Rashid Meredov, Foreign

Minister and Deputy Prime Minister of Turkmenistan;

Abdulaziz Kamilov, Foreign Minister of the Republic of

Uzbekistan; and Gary Litman, Vice President for Global

Initiatives at the U.S. Chamber of Commerce. This

historic event was the first time that ministers from the

five Central Asian republics convened to engage with the

U.S. business community, and served to highlight

opportunities for growth and for the application of

market solutions in Central Asia.

Georgian President Giorgi Margvelashvili hosted an evening reception for forum participants at the Presidential Palace. Speakers included Donald Rumsfeld, former US Secretary of Defense and president of the Rumsfeld Foundation; Ms. Aziza Umarova, a Rumsfeld Fellow from Uzbekistan representing CAMCA; and Giorgi Kvirikashvili, Prime Minister of Georgia.


Member News and Offers

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AmCham News

Social Entrepreneurship Program for students from Central Asia "Innovate for Change 2016"Innovate for Change is a 12-day social entrepreneurship project which ran from

August 1st to August 12th and was co-organized by the American Chamber of

Commerce in Tajikistan, Tcell, Dushanbe Sheraton Hotel, and American

Councils for International Education. It is designed to teach university

students about social entrepreneurship, management, and leadership.

During the first half of the event, university students attended lectures and

seminars given by entrepreneurs and leaders in the private and non-profit

sectors. In the second half, students broke into two groups to work on

consulting projects with a social impact focus. One group worked with Tcell at

their headquarters, while the other worked with the Dushanbe Sheraton Hotel

at their facility. Each company gave their group of students a task or problem,

which the students had to complete or solve with a focus on social impact. The

exercise gave students the opportunity to serve as consultants, offering fresh

and innovative perspectives on business. Companies, in turn, were provided

the chance to hear insights directly from local youth.

The Innovate for Change program started in 2015 as a US Embassy-funded

project, in partnership with Tcell and UNDP. This year, however, the program

was funded by the private sector—Tcell, Dushanbe Sheraton Hotel, American

Chamber of Commerce in Tajikistan—with a portion of funding from the US-

Central Asia Education Foundation, a scholarship program that sends students

to study business at KIMEP and AUCA. Participating students were from all

over Tajikistan and enrolled at KIMEP (Kazakhstan), AUCA (Kyrgyzstan),

and various universities in Tajikistan.

The closing ceremony was held on August 12th at Dushanbe Sheraton Hotel,

where students and instructors received certificates. Speaking at the closing

ceremony were Elisabeth I. Millard, US Ambassador to Tajikistan; Toni

Toshev, General Manager of Dushanbe Sheraton Hotel; and Mindaugas

Ubartas, CEO of Tcell.


AmCham News

On August 13th AmCham Tajikistan members and partners gathered in an informal setting at the SunРай'se Pool Bar, a new venue at Delfin waterpark. The event was organized by the Interfitness LLC, a new member of the AmCham foster network. AmCham Tajikistan members and partners attended the event with their friends and family, enjoying delicious food, refreshments, the pool, and an excellent atmosphere with great music. Guests were able to take staff-led tours of the X-Fit complex to see all that the gym has to offer.

X-Fit will open soon and welcomes everyone to pursue a healthy and fit lifestyle!

SUNRISE POOL PARTY



AmCham News

Business breakfast on business,

trade and investment

opportunities in Afghanistan

AmCham Tajikistan held a Business Breakfast on August 25th at the Dushanbe Serena Hotel, where invited speakers included entrepreneurs from Afghanistan, representatives of USAID's Afghanistan Trade and Revenue (ATAR) project, and Mr. Mujibullah Malikzada, the commercial attaché for Afghanistan's Ministry of Commerce and Industries.

During the meeting, Mr. Malikzada gave a presentation about business, trade, and investment opportunities in Afghanistan. The presentation was followed by a very active discussion where members of AmCham Tajikistan had the opportunity to learn more about Afghanistan's regulatory environment, potential business partners in Afghanistan, joint business opportunities, investment privileges for investors, and the country's overall business climate.


1. Do you hire interns sea-sonally or on a rolling basis throughout the year?Basically, in our practice it doesn't depend on the season. The other partners and I have decided to provide youth with profess ional development opportunities. We believe it is crucial to give current students and recent graduates the chance to start developing early on. Young people are flexible; it is easy to implement something new and to keep growing with

them. Shahlo, for instance, sees the world positively, is sparkling with ideas, wants to advance, and always wants to try something new. In contrast, we have encountered obstacles with experienced people because they are set in their ways and, at times, it may be hard to change their vision and negotiate with them. It is also difficult to introduce them to something new. Overall, we will keep supporting this internship program and AmCham Tajikistan in their future initiatives.

2.How did you recruit interns before this internship program existed? Do you think the AmCham-US-CAEF partnership has helped you?Basically, we didn't have a program like this before. We would go to universities to introduce our company and our employment opportunities to ambitious students. As far as our opinion of this new program, we are very pleased with our first intern. Personally, I see Shahlo as a future specialist and as a person who views the internship as a real growth and development opportunity. In my opinion, this program has huge potential, and I think it just needs to attract more companies to the program in order to meet student demand.

AmCham News

AmCham Tajikistan - US-CAEF partner to offer internship opportunities

AmCham, in partnership with American Councils for International Education and US-Central Asia Education Foundation (US-CAEF), organized a summer internship program, to place US-CAEF fellows (Tajik undergraduates attending KIMEP in Almaty, Kazakhstan or AUCA in Bishkek, Kyrgystan) in summer internships with AmCham member companies. This year, four fellows having completed their second year at KIMEP and AUCA universities were chosen for the internship program by US-CAEF. AmCham companies interested in hosting the interns then interviewed the applicants and after successful match between the companies and fellows, the internship program commenced in July and went on for eight weeks. US-CAEF is an American non-profit organization that works to foster an open and vibrant private sector in Central Asia by providing educational, vocational, and cultural experiences for Central Asian citizens.The Enterprise Student Fellowship program provides need-based scholarships to academically qualified students in Central Asia for undergraduate studies in business administration at the American University of Central Asia and KIMEP University and in economics (in a limited number of cases) at the American University of Central Asia.

We sat down with US-CAEF interns and representatives from the companies where they were placed: Crowe Horwath ACG, RSM Tajikistan LLC, Deloitte & Touche LLC and FINCA Tajikistan.

Crowe Horwath ACG

Rahimbek Akramov (Managing Partner at

Crowe Horwath)

1. Tell us about yourself. What do you study at KIMEP?I am a third-year student at KIMEP University majo-ring in Accounting and Auditing, and minoring in Finance. I started my inter-nship at Crowe Horwath on June 2nd, and it was arranged by American Councils under the umbrella of the US-CAEF scholarship program.

2.Was it hard to find an internship opportunity? Would you have rather interned where you study or in Tajikistan?In my opinion it was better to intern in Tajikistan. Since students from Tajikistan don't have citizenship in Kazakhstan, it's very hard for us to stay there after graduation. I am planning to come back to Tajikistan, so it was important to do internship in my home country to make it easier to find a job or at least better understand the job market.

3. Tell us about Crowe Horwath. Before your internship, had you known that the company existed in Tajikistan?I had known them by their previous name, Mazars. I'd heard that name before, but I didn't know anything about the company. When I came to Tajikistan and was informed that I was placed with Crowe Horwath, I did some research and learned that Mazars and another company had merged. Together, they formed Crowe Horwath, which is part of Crowe Horwath International.

Shahlo Jonmamadova (Intern)


AmCham News

3.What's your evaluation after having an intern who studies abroad? Was she able to keep up with her duties and responsibilities?My opinion about a person in general is shaped by her passion and desire to self-develop. Shahlo, stands out because of her ability to cope with new tasks and her perfect performance on the assignments we gave her.The procedure of hiring a new person to our team starts with signing non-disclosure agreement to protect confidential information. Then company and employee or intern sign a contract outlining the specific duties and responsibilities of an employee. Importantly, we try to involve interns as much as possible as we believe that having too much spare time may lead to boredom and distractions. We therefore gave Shahlo clear responsibilities from the very beginning: real assignments, real deadlines and real requirements. Basically, Shahlo did a great job on almost every assignment. Of course, as an intern she faced some difficulties, but overall Shahlo is a quick learner and easy to work with. 4.Would you consider hiring her after she graduates?Yes, we actually already discussed this. We offered Shahlo the opportunity to do additional internships in Crowe Horwath until she graduates, and would be happy to employ Shahlo after graduation.

5.Do you think this program could help mitigate Tajikistan's emerging “brain drain” issue?In my opinion, if you are passionate enough, you can always find something for yourself. Most people try to seek a good life, and it may be easy for them to move somewhere and find more opportunities and better conditions abroad. But if you try, you can find a good quality of life in Tajikistan as well.

4. What are your duties and responsibilities? Do you find this experience helpful?Yeah, I actually find this experience very helpful, because the things we do here in the office are totally different from what we learn in college. It is a very different practice that we use in Crowe Horwath. I help with certain steps of the auditing process. I participated in a project with Caritas Germany, which was how I really came to understand the whole audit process. Moreover, I also help auditors with some of the transaction operations for their reports. Sometimes senior auditors give me assignments like calculating salaries.

5. Would you want to come back and work here in Tajikistan upon graduating?I would definitely want to. After graduating, Crowe Horwath will be the first place I apply for a job.

6. After having interned here in your home country, what would you suggest to your peers?KIMEP students have been interning in Kazakhstan for many years. However, citizens of Tajikistan did not have full access to these opportunities since we were required to have residency/work permit. Everyone from Tajikistan thought that they would stay in Kazakhstan, but after graduating they realized how hard it actually is to stay, and meanwhile it is also hard to find jobs in Tajikistan. That's why I suggest doing an internship in Tajikistan rather than Kazakhstan.

RSM Tajikistan, LLC1. Do you hire interns sea-sonally or on a rolling basis throughout the year?At RSM Tajikistan we usually

provide internship op-portunities all year in so students can put their theoretical knowledge into practice.

2.How did you recruit in-terns before this internship program existed? Do you think the AmCham-US-CAEF partnership has helped you?Yes, the AmCham- American Councils partnership has definitely helped a lot. Actually, Zuhro is our first intern from American Councils who is part of the US-CAEF scholarship program, and so far she has been very hardworking and responsible.

Maftun Barotov (Audit Manager)

1. Tell us about yourself. What do you study at KIMEP?My name is Zuhro Qonu-nova. I'm a third-year Audi-ting and Accounting student at KIMEP University, which i s l o c a t e d i n A l m a t y, Kazakhstan. I have been interning at RSM Tajikistan for seven weeks.

2. Was it hard to find an internship opportunity? Would you have rather interned where you study or in Tajikistan?I'm not aware of how hard or easy it is to find an internship in Tajikistan. My internship at RSM Tajikistan was arranged by American Councils as part of the US-CAEF scholarship program.I believe it is important for me to intern in my home country rather than in Kazakhstan, as I'm planning to

Zuhro Qonunova (Intern)


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AmCham News

3. What's your evaluation after having an intern who studies abroad? Was she able to keep up with her duties and responsibilities?We have employees who studied abroad in countries like Russia, Kazakhstan, UK, USA, and so on. In that sense, we are somewhat international. As for interns, we have those who are studying abroad as well as those who study here in Tajikistan. Regarding Zuhro, she is very responsible, as I already mentioned, and she is makes an effort to do her job as well as possible.

4. Would you consider hiring her after she graduates?Why not? Probably yes. But I think it would be better to discuss it after she graduates.

5. Do you think this program could help mitigate Tajikistan's emerging “brain drain” issue?It depends on how patriotic the person is. But in my opinion this experience will not help with the “brain drain” problem, because it just allows for a few people to actually do their internships in Tajikistan. Therefore, it's not enough to eradicate the “brain drain” issue.

return here and use the knowledge and skills I gain for the development of Tajikistan. 3. Tell us about RSM. Before your internship, had you known that the company existed in Tajikistan?RSM Tajikistan is an auditing company and one branch of RSM International, whose head office is in London. It has 700 offices in over 80 countries. RSM Tajikistan delivers tax, consulting, outsourcing, and auditing services to various local and international companies. I didn't expect companies following international standards to be operating in Tajikistan, so I hadn't known about RSM Tajikistan before. But being an intern in a company which provides high quality services provided great work experience and made my future path much clearer.

4. What are your duties and responsibilities? Do you find this experience helpful?As I mentioned above, the company delivers consulting services, therefore I now have a clearer understanding of this sphere, and was closely involved with a specific project that the consulting team is working on. I was also involved with counting the salaries in different organizations and illustrating the overall results graphically using Microsoft Excel. Moreover, I worked with a local bank's financial statements by calculating their main accounts and the percent change for various financial accounts. I had the chance to work with the 1C:AccountingSuite system, which is the predominant system in Central Asian countries.I believe this experience is extremely helpful, because I learned how to manage my time when I have multiple tasks, developed my leadership skills, learned from experienced and intelligent people, and had the chance to apply the knowledge I gained at university. Thanks to RSM Tajikistan, I have a clear idea of how the company operates, what the main aspects of auditing are, and how to become an auditor. This experience helped me realize that I have chosen the right path and helped to clarify my future career goals. Moreover, I am more motivated to go back to KIMEP to continue my studies, gain more knowledge, and contribute to the development of Tajikistan.

5. Would you want to come back and work here in in Tajikistan upon graduating?Yes, I would definitely love to come back and work here in Tajikistan. I'm glad that now I have an understanding of what it feels like to work here, what to expect, and, of course, RSM might be a company where I see myself when I graduate.

6. What would you suggest to your peers having interned here in your home country?I highly encourage future US-CAEF interns to use this opportunity to grow professionally. In my opinion, with the experience I had, I can confidently say that the organizers did a great job and everything worked out perfectly. My one and only suggestion would be to take an internship regardless of where you do it. It seems to me that what matters isn't the country you're in, but the experience and knowledge that you can gain while doing the internship. I would say, definitely do it, and take every chance that you get in your future career!


AmCham News

1. Do you hire interns seasonally or on a rolling basis throughout the year?In Deloitte Tajikistan, we usually hire interns to entry-level positions, but as permanent members of staff. Although Deloitte offers these types of internships in other countries, this was our first summer in te r nsh ips a t De lo i t t e Tajikistan. Whether or not we offer internships depends on our work volume, as we need to

mak e sure that the person is busy rather than simply sitting in the office.

2. How did you recruit interns before this internship program existed? Do you think the AmCham-US-CAEF partnership has helped you?Usually, if we have a vacancy at Deloitte Tajikistan, we place an announcement in the Asia-Plus Newspaper, post it on the Deloitte Caspian Region Facebook page, and e-mail it to the Public Institute of Professional Accounting and Auditors. We also used to place announcements on the unt j .o rg webs i t e , bu t they no long er accept announcements from for-profit companies. We try to use all the tried and tested sources we have at our disposal to find potential candidates.The AmCham-US-CAEF partnership has been really helpful. Initially, we were not planning any internships, but when the suggestion was made, we decided to try it out. If we hadn't, we would not have hired anyone.

3. What's your evaluation after having an intern who studies abroad? Was she able to keep up with her duties and responsibilities?I can't compare, as we haven't had any interns who study in Tajikistan, but my basic understanding is that students who have studied abroad have a better understanding of accounting and auditing principles because Tajikistan, in contrast to neighboring countries, only recently began transitioning to International Financial Reporting Standards and is still in that transition process.Generally speaking, Osiya met my expectations. Of course, our expectations of her were not the same those we would have for a university graduate. We did not try to get her to do complex things, but just tried to get her to understand what auditing is. I believe she now has a good understanding of what auditors do and can decide for herself if auditing is what she'd like to do in the future.

Deloitte & Touche, LLC

Gulanor Atobek (General Director)

1. Tell us about yourself. What do you study at AUCA?My name is Osiya, and I have just completed my second year at AUCA. In a few weeks, I will be a junior. I am studying business administration, and I am doing an internship at Deloitte Tajikistan.

2. Was it hard to find an internship opportunity? Would you have rather interned where you study or in Tajikistan?No, it was not that hard. The US-CAEF program announ-ced the internship contest, so I applied. I completed the application and wrote an essay. Then I had an interview and they selected me. My main focus was to get an internship with Deloitte no matter where, but preferred to do it in Tajikistan, so I could combine being with my family and doing my internship.

3. Tell us about Deloitte. Before your internship, had you known that the company existed in Tajikistan?Deloitte is a member of the Big Four and provides audit and a wide range of consulting services. However, in Tajikistan Deloitte mostly provides audit services.

4. What are your duties and responsibilities? Do you find this experience helpful?I don't have any set responsibilities; the work I do depends on what is being worked on. For instance, I was working on two projects, both of which were audits.One was outside of Dushanbe, so we were on a business trip for a month. For the first week, I was mostly involved with technical things. I wasn't very good at Excel at all; I didn't know how to do even the most basic things, but my colleagues taught me how to use it. During the second week, I was given additional non-technical tasks. The third week, I was sent to do in-person observations and inventory counts. When I got back to Dushanbe, I was involved in the audit of a microcredit organization and was asked to work with files and check the information in them, review loans, and some other things. I really do believe it was a very helpful experience. My favorite course at AUCA was accounting. You could say I'm in love with accounting. During my first project at Deloitte, I was not sure whether I liked auditing or not, possibly because I had no time to think about it. When I was working on my second project, I realized I really liked it. I am glad I had this experience, as it has helped me understand whether I really want to become an auditor.

5. Would you want to come back and work here in Tajikistan after graduating? Yes, I have already told them to wait for me.

Osiya Olimnazar (Intern)


AmCham News

1. Do you hire interns seasonally or on a rolling basis throughout the year?We p r ov i d e i n t e r n s h i p opportunities for students on a regular basis; however, before offering internships to students, we determine our need for interns with the department managers.

2. How did you recruit i n t e r n s b e f o r e t h i s i n t e r n s h i p p r o g r a m

existed? Do you think the AmCham-US-CAEF partnership has helped you?We provide equal internship opportunities to all Tajik students studying either in Tajikistan or abroad. Since students studying abroad have a good command of English and study all of the important subjects using the most current resources, they can certainly make positive contributions to our company and learn a lot from their experience.

3. What's your evaluation after having an intern who studies abroad? Was she able to keep up with her duties and responsibilities?It is a great opportunity for Tajik students to study abroad with people of different educational and cultural backgrounds. They have access to advanced resources and learn from the experiences of other countries, and what they learn abroad can be implemented in Tajikistan. Zuhro was willing to learn as much as possible. In a very short period of time she has studied many reports, manuals, and procedures related to our business in Tajikistan. We saw that after she reviewed our reports and manuals she immediately came to us with questions and comments, which proves that she has the ability to learn things very fast.

4. Would you consider hiring her when she graduates?I don't see why not.

5. Do you think this program could help mitigate Tajikistan's emerging “brain drain” issue?I really hope so! We are trying to hire people with good knowledge of accounting, and when we do so, we are interested in their learning capabilities. The chances of getting hired increase greatly for KIMEP and AUCA students.

6. After having interned here in your home country, what would you suggest to your peers?It depends on their plans. If they plan to remain in Kyrgyzstan after graduation, then I would suggest interning there to create a professional network and get to know the local working environment better. For those planning to return to Tajikistan like I did, I would suggest interning in Tajikistan.

Zuhro Ganjibekova (Intern)

1. Tell us about yourself. What do you study at AUCA?My name is Zuhro Ganji-bekova, and I am a junior in the Business Administration Department at the Ame-rican University of Central Asia.

2. Was it hard to find an internship opportunity? Would you have rather interned where study or in Tajikistan?I couldn't tell if it was hard to find an internship opportunity, since the U.S.CAEF Program Coordinator in Tajikistan, Zarrina Muhiddinova, was searching for a host company and not me.It would have been easier for me to do an internship in Kyrgyzstan, since our university courses teach us both international standards and Kyrgyzstan's own regulations and laws. As a result, I'm more familiar with Kyrgyz accounting standards, legal documents, and guidelines. However, I preferred interning in Tajikistan because it is an excellent opportunity to familiarize myself with Tajikistan's accounting systems, taxes, and service standards and requirements. If work in Tajikistan after graduating, this background knowledge will be very relevant.

3. Tell us about FINCA. Before your internship, had you known that they existed in Tajikistan?I am interning at Limited Liability Company, Microcredit Deposit Organizations FINCA in Dushanbe's Head Office. Operating in 23 countries, FINCA strives to alleviate poverty through long-term solutions that help people build assets, create jobs, and raise their standards of living. In Tajikistan, FINCA employs around 500 people and serves more than 1,000,000 clients through 37 service outlets (13 branches and 24 sub-branches). Yes, I knew about FINCA before my internship.

FINCA Tajikistan

Ramikhudo Ramikhudoev (Financial Manager)


AmCham News

4. Would you consider hiring her after she graduates? If she is interested in working with our company after graduation, we would certainly consider her for any relevant position. However, we have come to understand that she is mainly interested in external auditing.

5. Do you think this program could help mitigate Tajikistan's emerging “brain drain” issue?Yes, I think this type of program has a positive impact on the improvement and development of the career paths of our younger generations.

4. What are your duties and responsibilities? Do you find this experience helpful? I am responsible for helping with: reports to our investor, Oikocredit; preparation of financial statements; calculating loan loss provisions; preparation of daily reports, which contain information about the currency position, portfolio tendencies, performance and accountability reporting, etc.; and taking inventories of tangible property.Yes, I find this experience to be helpful. Even though I never planned to work at a bank, I believe the knowledge, experience, and skills that I have gained will be very beneficial for my career as an external auditor.

5. Would you want to come back and work here in in Tajikistan upon graduating?For now, I cannot say for sure whether I will return back to Tajikistan right after graduating. If I can find a job where I can learn, develop professionally, and earn enough, I will be happy to come back to my home country and serve my community. Alas, in Tajikistan it won't be easy for a new graduate to find a job that satisfies the abovementioned criteria. However, I should emphasize that I plan to return to Tajikistan as I become an experienced and in-demand professional, so that I can contribute to the development of my home country.

6. After having interned here in your home country, what would you suggest to your peers?For my peers who have interned in Tajikistan, I would suggest to that they pay close attention to Tajikistan's laws, regulations, and requirements, and that they become proficient in Microsoft Excel.


The following interviews were conducted with the help of AmCham Tajikistan interns, Shanoza Abzhabarova who studies Banking and Finance at Eastern Mediterranean University and Zulfiya Boboeva who studies at Avicena Tajik State University. On this occasion, AmCham Tajikistan wishes them success in all their future endeavours.


AmCham Tajikistan team had the opportunity to have a fruitful conversat ion with Mar t in Naegele, who is currently the Acting Country Officer for IFC Tajikistan. Mr. Naegele has stayed with IFC Tajikistan until September 2016. Please read the full interview below.

Mr. Naegele, you are currently the Acting Country Officer for the IFC (International Finance Corporation), a member of the World Bank Group, in Tajikistan. Could you please tell us a few words about yourself ? What did you do before coming to Tajikistan? How do you like Tajikistan? My name is Martin Naegele. I am an Austrian and German citizen, and I grew up in Austria. I studied in Austria, France, and the United States. I am currently IFC's Country Officer in the Kyrgyz Republic and Acting Country Officer in Tajikistan for IFC, while Manizha Mamadnabieva is on maternity leave. Before working for IFC, I spent six years in Geneva, Switzerland where I worked for the World Economic Forum. Previously I had assignments with the Open Society Institute. I have been working in Tajikistan, Kyrgyz Republic, and Kazakhstan over the last twelve years. I just returned to Tajikistan after not having visited for eight years, and I am actually impressed by the developments I see. I was last in Tajikistan in January of 2008, in the midst of a severe energy crisis. People were enduring hardship, lacking electricity and heating—very tough conditions. Now I'm back, and see a completely different city and country, and I think a lot of the overall economic growth has found ways to serve the general population in terms of infrastructure, public space, and economic opportunities. For me, returning has been a very positive experience, and of course Tajikistan is one of the most beautiful places for people who like nature and mountains.

Can you tell us a few words about IFC and IFC's current projects in Tajikistan?IFC is celebrating its 60th birthday this year. We are not just the oldest but also the largest international financial institution focusing exclusively on the private sector. Our goal is to stimulate economic growth and create jobs by fostering private business. Alongside investment we do advisory work to help countries improve their investment climate, and businesses improve their standards, become more competitive and attractive for investors, and pursue long-term growth strategies.It was an IFC staff member in 1981 who coined the term “emerging markets”. IFC's mission is really to pave the way for emerging-market investments, which we have been pursuing since 1956. Many of our clients have been with us for decades. We have incredible growth stories from all around the world in the most challenging markets, and this is what we are working towards in Tajikistan, where we have a number of investments in finance, retail, tourism, and energy. We support businesses by improving the investment climate, strengthening the financial system, fostering corporate governance, improving access to finance, introducing international food safety standards, and improving supply

chains and value chains. In your opinion, what are the primary economic challenges that Tajikistan faces, and in which sectors do you currently see the most potential for growth?With respect to challenges, the regulatory environment needs more improvement for both local and international business. It is not easy to be successful as a small or medium-sized business, but at the same time, it is not easy to be big either. There is a gap between the laws and regulations as they exist on paper and what is implemented, and this is affecting businesses' long-term planning. Nowadays we are looking for “smart growth,” which requires strong human capital and a strong basis for innovation, which is not always sufficiently supported here. One good example, I believe, is energy. Tajikistan has among the highest potential for hydropower worldwide; however, the current tariff and regulatory structure is intricate. There is virtually no, or almost no, private-sector involvement. If you look at Georgia, for instance, another post-Soviet country, you see that this is something that can be remedied relatively easily once the necessary steps are taken to allow the private sector to fully engage and bring the most benefit to the country. The most promising sector currently is agriculture and food processing. Also trade, to a degree, but trade also faces regulatory hurdles. Let's reframe the question a bit: Where do we see the best potential for our clients? We see strong interest in supply chains in agriculture and food processing. We are working with medium-sized businesses on corporate governance to attract more international financing to move up the value chain, and expand into neighboring countries. We see interest for public-private partnership projects. There is definitely interest in hydropower and mining, and the problems that I listed before were specifically in reference to those sectors and the particular needs of those companies.

You mentioned corporate governance. IFC will give a series of presentations on this topic in Dushanbe and Khujand. Can you tell us more about this project and your opinion on the current status of corporate governance in Tajikistan? At IFC we are undertaking difficult projects in tough markets. We don't invest where commercial banks and investors are already prepared to operate; we basically open the way for them to follow. So we are at the frontline, and in order to invest we carefully examine businesses' long-term strategy. We are not coming in for the quick buck. We usually stay for


Focus on an AmCham Member

IFC: DevelopingEmeging Markets

years, if not decades. As such, we want to make sure that in five or ten years, we are still engaging with a successful, sustainable, and growing business, and key to that is actually a company's corporate governance. We learned that the hard way early on. It's not just financial indicators or the business model; it's ultimately companies' sustainability, which is based on the strength of corporate governance. Sound corporate governance means you're strong, you're efficient, you're accountable, you mitigate risks well, and you safeguard yourself against mismanagement, which allows you, in turn, to attract capital and grow long-term. As Tajikistan celebrates 25 years of independence, what you see on the market, interest in corporate governance is growing tremendously. Tajikistan is at a stage where many of the most successful businesses are 'graduating' to the next level. They are thinking about succession, about professionalizing their management, about expansion, some of them are thinking about going public. All that gets you back to corporate governance, and for that reason, IFC has developed a set of dedicated corporate governance tools focusing on family-owned businesses, small and medium enterprises (SMEs), and succession planning. Companies which use the time during the economic crisis wisely to strengthen their corporate governance will be able to quickly reap the benefits of the upturn once the crisis ends.You can imagine someone who started a business in the early 1990s selling water, trading foods and clothes, or importing used cars. Some of those early ventures have become successful companies, they have reached certain levels of revenue, many of them have goals to expand, and some of them have become large conglomerates. Often times several family members are involved, and now they are reaching a more sophisticated level of development. Some executives are retiring, and many owners are thinking about handing over to the next generation. All of this presents a wonderful opportunity to invest in corporate governance and companies' ability to mitigate risk and safeguard against mismanagement. For example, two brothers unable to decide on the future of their company.Corporate governance requires continuous improvement, and as a businesses grow—including family businesses and SMEs—it is something one must develop. Further down the line, a big step is to go public. When you do that you change your shareholder structure, so it becomes extremely important to have the right corporate governance in place. Let's return to those brothers who disagree about the future of their company: they have been working next to each other for many years and have celebrated many moments of success, but now comes the time for a more formalized structure and more important

decisions, more money is at stake and the risks are much higher, and all of a sudden their system breaks down. Big companies in developed markets have failed for those reasons, and that's why companies across all sectors, and even state companies are requesting IFC's corporate governance advisory.There is still work to do in Tajikistan: corporate governance is a relatively new concept and, most importantly, it has to be adapted to the conditions and traditions of the country, which this is what we have achieved with our corporate governance toolkit.

You said that you really like mountains. How do you see the current tourism opportunities in Tajikistan, and where do you like to hike yourself ?I often go hiking with a friends or alone, but given my workload I haven't actually been able to do much of that in Tajikistan, to be honest. I have traveled to various places, like Khujand, Qurghonteppa and Romit, but usually for business. That's about the radius that I have covered so far, so I haven't made it to the big mountains, to the Pamirs, but it's on my to-do list for this year.Tourism has enormous potential, but if I use myself as an example—you know, hiking in the mountains with my “ryukzak”—I come to the conclusion that this sort of tourist is neither big money nor big numbers, so putting so much emphasis on this kind of tourism, I would say, means throwing the bigger opportunities away. So what do I see as a big opportunity? Look at the map: in the range of a couple hours flight time you got Karachi, New Delhi, the Arab peninsula, unbearable heat and humidity from Mai to September. If you get a minimal number of inhabitants of those cities to spend couple of weeks in the fresh mountains, the fresh air of Tajikistan, you would see very different tourism statistics. I'm not even talking about the Chinese. And I am not saying you need them all! Just a fraction of India, Pakistan and China would be enough to fill all of the resorts and sanatoriums of Tajikistan and more. That's the real growth potential.Backpackers and adventurers will come once or twice in their life. They spend very little money, don't use many services, and spread thinly. On the “tourism value chain” they are really at the lower end. Obviously, Tajikistan is not competing with Switzerland to attract the Arab or Indian elites who fly their whole families in their private planes to Geneva for the summer while it's too hot in their own countries, but there is a growing middle class across New Delhi and the Indian business centers that would like to have a sort of “Switzerland experience” but at a much better price. The same is true for Karachi and some Chinese cities, and these people would be spending considerably more money and use a greater set of local services.When thinking about opportunities, the most striking thing is the fact that so much attention is still pointed West, meaning Moscow, Istanbul, Europe and the US. If you look at the map it just doesn't make sense, and now I am not just talking about tourism. For instance, some of the most interesting mining and telecommunication projects in the region are Chinese, and contrary to what people feel, they are doing a pretty good job, including with respect to corporate governance. They're not doing the same old jobs of ten, fifteen years ago—the players in the region are becoming more and more sophisticated.

Mr. Naegele, Thank you so much for your interview, and we wish you best of luck. Thank you, my pleasure.




RSM PARTNERS WITH SAVE THE CHILDREN INTERNATIONAL TO MARK FIFTH ANNUAL RSM WORLD DAY

Global event sees RSM join with Save the Children International for Women's Day to raise family budgeting and business planning skills of Women's Groups for Women's Wealth and Influence (WW&I) Project in pursuit of their role in i m p r o v i n g e d u c a t i o n e n v i r o n m e n t f o r t h e i r ch i l d r e n , i n p a r t i c u l a r f o r g i r l s i n Pa n j D i s t r i c t .

22 September 2016 marked RSM's fifth annual RSM World Day and the largest celebration of the common vision, values and pur pose tha t the s i x th l a rg e s t i nde penden t aud i t , t ax and consu l t ing ne twork has eve r s een . Through a wide variety of different activities all around the world, staff in RSM firms across more than 70 countries united in colleague, client and charity events to celebrate RSM's core values of collaborative working, deep individual understanding, idea and insight sharing for client benefit.RSM World Day activities included client events, staff breakfasts, volunteer/charity work, and teambuilding to further strengthen engagement with RSM's common purpose and increase their understanding of the RSM brand values, the global network, its capabilities, and its positioning – 'The Power of Being Understood'. The network also initiated a major global advertising campaign across international media titles and in major international airports highlighting RSM's belief in the importance of developing a deep mutual understanding in order to build successful business relationships. RSM World Day 2016 falls nearly a full year after the RSM network came together under a single unified brand, reinforcing the network's global strength in providing consistently high quality audit, tax and consulting services to entrepreneurial, growth-focused organisations wherever they may be.RSM in Tajikistan has been a member of the RSM network since 2015.

21 September 2016 RSM conducted a Master class on “Family budgeting” and “Business planning”, for more than 70 women-representatives of Women Groups from 17 districts, Committee of Women and Family Affairs from Dushanbe and Panj, District authority officials, and upper grade schoolgirls. The master class was very useful and interesting for the women of Khatlon Oblast.

Ms. Zuhro Murodova, the Area Program Manager of Khatlon for the Save the Children International said: “RSM's master class was very beneficial for the Women Group and the participating women enjoyed the topics very much. The Women Group wished to disseminate the recording of the lecture to other women in their community to improve their economical skills and knowledge. We thank RSM for their input in this event and welcome future collaboration in such events.”

Jean Stephens, CEO of RSM International said: “RSM World Day is a celebration of our shared values as a global network and a special event in RSM's calendar. I'm extremely proud of the charitable work that our member firms have undertaken over the past five years in honour of RSM World Day. The variety and scale of events and activities that took place this year was remarkable.”

“I want to congratulate and thank all our member firms, no matter their size or the scale of their events, for proudly displaying the core ideals that makes RSM such a unique global network.”

RSM's unified brand enables it to better communicate its strengths and global service capabilities as the adviser of choice to the middle market. The network has member firms in over 120 countries and comprises over 38,000 people.

AmCham China Delegation Visit To Xinjiang ProvinceI am a Member of the Board of Directors of AmCham Tajikistan (The American Chamber of Commerce in Tajikistan), and I participated in the AmCham China delegation visit to Xinjiang province in late June to learn more about China's fairly new One Belt, One Road (New Silk Road) Initiative. This infrastructure initiative seeks to connect all of Eurasia, with both land and maritime components (Xinjiang is part of the land component). The trip was co-organized by AmCham China—led by AmCham Executive Director, Alan Beebe—and the China Investment Promotion Agency (CIPA). During the trip, we met with various businesses and high-level local officials from a number of entities, including the Department of Commerce of Xinjiang Autonomous Region of the PRC, the Urumchi Municipal Committee, the Urumchi Economic and Technological Development Zone, the Shihezi National High-Tech Industrial Development Zone, the Shihezi Standing Committee, the Khorgos Economic Development Zone, and the State-Level Border Committee. We also met Beijing-based officials from the CIPA and various AmCham China member companies interested in doing business in Xinjiang.

Xinjiang Uyghur Autonomous Region (XUAR) is the far northwest province of China, taking up one-sixth of China's land area and bordering Russia, Mongolia and Kazakhstan in the north and northwest; Kyrgyzstan, Tajikistan, and Afghanistan in the west; and Pakistan and India in the southwest. Within China, it borders Gansu, Tibet, and Qinghai provinces. Xinjiang has a population of over 20 million. Its capital, Urumchi (also spelled Urumqi in English and also called Wulumuqi in Chinese), has a quickly growing population that doubled over the last 15 years from 2 million to possibly over 4 million.

The airport is modern and has been greatly expanded since I had a layover there nine years ago on the way to Shanghai. There are now three terminals, and in the international terminal all signs and announcements are in four languages: Chinese, English, Russian and Uyghur. Uyghur is a Turkic language very similar to Uzbek and also fairly similar to Kazakh. Languages spoken by Muslim minorities in China, such as Uyghur and Kazakh, are written in modified Arabic scripts.

Russian is used because the majority of international flights from Urumchi go to the former Soviet Union, with flights to all capitals of post-Soviet Central Asia and to some of the region's secondary cities. There are also flights to Baku, Azerbaijan; Tbilisi, Georgia; and a number of cities in Russia. However, the language of commerce in Xinjiang is Chinese, and not knowing the language severely hampered me on the trip, as practically all written materials and presentations were in Chinese. Due to my study of Uzbek and Turkish, I was able at least have basic conversations with local Uyghurs and Kazakhs. I was also able to read both languages a bit due to my study of Farsi, which also uses a modified Arabic script (Farsi is similar to Dari in Afghanistan and to Tajik).

The drive from the airport to the hotel takes about 40 minutes, and on the way you can see how recently almost everything has been built in Urumchi. There are lots of overpasses and interchanges on the road and new buildings that remain empty. Urumchi sprawls, and while there are currently three bus rapid-transit (BRT) lines, the main news is that Urumchi is building three subway lines, the first of which is slated to open in a few years. Currently, the main way around is by metered taxis, which are fairly inexpensive. You just flag down an official taxi in the street. There are various neighborhoods and parks in Urumchi, with the main sites being the Erdiqiao and International Bazaars, which are connected and mainly offer modern products.

The other major attraction, towards the airport, is the National Museum, which is quite interesting and has various exhibitions, including one on the history of Xinjiang and its ethnic minorities (including Russians, Tatars, Uyghurs, Kazakhs, Kyrgyz, Tajiks, Manchus, and others). The National Museum is in a wealthy area with some international hotels, including a Sheraton, and an international mall (where my ATM card finally worked!). The mall is completely modern and has many American and international brands.

After checking into the hotel, I took a taxi to a Uyghur restaurant to meet the rest of the group, which had just flown in from Beijing. We then went to a meeting with Xinjiang government officials to discuss various sectors of the economy and foreign investment in Xinjiang. The group included government officials from the Departments of



Commerce, Human Resources and Social Security, Investment Promotion, Food and Drug, E-Commerce and Informatization, the Health and Family Planning Commission, and the local foreign investment enterprises association.

The next day, we visited the Urumchi government offices for a meeting to discuss similar issues with Urumchi officials, followed by a visit to the Urumchi Economic and Technological Development Zone and the Urumchi International Inland Port Area.

The Urumchi zone was established in 1994 and contains a number of industries, most importantly manu-facturing, food and beverages, wind power, automobiles, healthcare, e-commerce, film, software, and other tech industries. It is currently responsible for about a quarter of Urumchi's GDP. The new high-speed rail station is located within the zone. Its routes extend into eastern China and to the north and west into Kazakhstan and on to Europe through Russia, with possible spurs to the Middle East. Other future branches may go to Pakistan and on to South Asia. Flights will also expand to hit more key destinations in these areas.

Two hundred companies are located in the massive zone, and the authorities are building a new park, other ecological areas, and a new international hospital. The zone is already exporting to and importing from Central Asia. For example, ADM is importing agricultural products from Central Asia, and many of the businesses have regional offices in Central Asia and offer services there. Highlighting the opportunities afforded by the railway and new construction, the Xinjiang Chamber of Commerce and Industry (XJCCI) believe

Urumchi will become the center of Central Asia for logistics and transportation, commercial dealings, agriculture, healthcare, and financial services. XJCCI also discussed their interest in increasing tourism and attracting international investment into their energy sector.

A whole new city has been built around the zone, with numerous newly-constructed apartment and office buildings waiting for occupants. The new subway will stop in the zone and allow one to travel to the center of Urumchi in just 20 minutes. The zone was planned with the environment in mind, as there is a lot of greenery and a big park. In my opinion, this area will become the center of Eurasia if the One Belt initiative progresses as planned, and the whole area will fill with new businesses looking to take advantage of the initiative.

After lunch, we drove to about two hours to Shihezi, a pleasant, tidy, green town of about 700,000. In fact, 42% of the town is green. Shihezi is almost all ethnically Han Chinese and was founded in 1952 by the military (Xinjiang Production and Construction Corps, or XPCG), and our group toured the military museum. Our hotel was probably typical for the region: likely more than two decades old and in need of refurbishment. However, the hotel was right near a park that was pleasant to walk through.

Our delegation later met government officials from the Municipal Standing Committee of the Shihezi division of XPCG and the Department of Commerce and with company representatives, and we toured the Shihezi National High-Tech Industrial Development Zone.

Shihezi is in the Tian Shan Mountain Belt and is one of 17 gateway cities in Xinjiang. The city has six strategic industries: food processing (wine, meat and dairy), clothing and fashion from cotton, chemicals, equipment, manufacturing, and services. They are also hoping to build an innovation park for startups.

Shihezi is a regional center for trade, finance, logistics, and energy distribution. It benefits from inexpensive electricity, water, and steam, and there are also plans to build a new airport. The authorities emphasized their interest in attracting foreign investment, especially in agriculture (they have 14 regional agricultural development parks) and in their high-tech zone. Currently, Shihezi exports agricultural machinery and equipment, chemical end products, as well as agricultural products, such as corn and textiles, to Europe.

We then visited the Daqo New Energy Corporation which produces silicon rods and is the lowest-cost silicon rod producer in the world. Their main plant is in Chongqing, but they have opened a branch in Shihezi. The machinery requires high levels of expertise, so most of the top management and line workers have to be imported from the rest of China.

The director was trained in the US, and I could see how important the US has been for China's rise due not only to foreign investment, but also to technology transfer and, most importantly, knowledge transfer, both in hard skills



and sciences and in soft skills and management practices.

We then drove back to Urumchi to fly to Yining (also known as Gulja), the capital of the Ili Kazakh Autonomous Region. I really liked Yining, a multi-ethnic town of about 700,000, which is very green and situated on the Ili River. Most of the town is modern, but many of the modern buildings are built in nice styles with various pastel colors. This perhaps reflects the Russian influence, as the Soviets had a consulate in Yining during Stalin's time. In fact, the nice hotel where we stayed was built on the grounds of the former Soviet consulate. The old consular buildings still exist, and there is still a bust of Lenin there. The city also has examples of Chinese and Islamic architecture. Sights of interest include the Baytullah Mosque, the Kazanqi Market and the Yining Bridge over the Ili River.

We then drove about an hour to Khorgos on the border with Kazakhstan to hear presentations by representatives of the Department of Commerce and the Khorgos Economic Development Zone. The next stop was the Khorgos International Border Cooperation Center. In Khorgos, as in Urumchi, a whole new city has been recently built, with new apartment towers and office blocks waiting for occupants. In fact, our delegation visited the headquarters of one of the local developers, who showed off his plans for a new complex. The city of Khorgos itself is almost 2000 square meters.

The Khorgos Economic Development Zone is 73 km2 and is focused on chemical engineering, agricultural products processing, biopharmaceuticals, renewable and new energy, building materials and machinery manufacturing, trade and logistics, tourism, culture, and high-tech industries. Interestingly, the China-Kazakhstan Khorgos International Border Cooperation Center is the first transboundary Free Trade Area in the world. Tourists can enter the zone without a visa and shop duty free. The area also functions as a space for trade negotiations, merchandise display and sales, warehousing and transportation, hotels and restaurants, commercial and financial services, trade fairs and more. Khorgos plans to become an international finance, logistics, information, and tourist center.

The Khorgos Port Railway connects China with Kazakhstan, reaching to Atyrau on the Caspian Sea, and one branch reaches all the way to Rotterdam. The railway has a capacity of 22 million tons per year and will reach 38 million tons by 2030. The route to Rotterdam is 9000 km shorter than the sea route and nearly one month faster.

There is also a gas pipeline that reaches from Turkmenistan to Khorgos and then continues on to eastern China (Jinjiang) with three lines and a capacity of 55 billion cubic meters. The Yining airport, 90km from Khorgos, is being enlarged. Investors and companies get various special tax preferences and exemptions depending on their investments and incomes. In addition, equipment and infrastructure sent to the zone from other parts of China will be considered exports and can be tax-refunded, while goods imported from Kazakhstan may be exempt from

duties and VAT.

The zone emphasizes manufacturing in eight industries:

1) Textiles and Clothing

2) Agricultural Processing

3) Machinery and Equipment

4) Biomedicals

5) Construction Materials

6) Home Appliances

7) Energy and Resource Processing

8) High-Tech

We were shown the investment flow chart for business projects, which outlined the steps to getting your projects off the ground, which agencies you have to deal with, and the processes you have to undertake to get approvals. We were also provided a list of investment costs for land, water, sewage, heat, and electricity.

We then visited the Xinjiang Mauri Food Co. Ltd. Branch of AB Mauri, a British baking company that produces yeasts.

The next morning, the delegation went to the State-Level Border Economic Cooperative Zone of Yining City and the Yining Border Economic Committee. These groups are focusing on building materials, textiles, agriculture, biopharmaceuticals, machinery and manufacturing, furniture, and small appliances. We then went to the Dosace plant, which makes cosmetics, oils, and medical treatments from lavender and other plants.

Xinjiang is clearly abundant in natural resources, including petroleum, natural gas, coal, iron, copper, gold, chrome, nickel, rare metals, salt, and non-metallic construction materials. As a result, they are prioritizing the building materials and construction industries. Xinjiang is also developing a renewable energy cluster, including wind, solar, dry air and biomass. The Xinjiang Chamber of Commerce and Industry also laid out for us various projects seeking investments for coalfield development and transmission, and exploration and processing of ore deposits and other minerals.



In addition, Xinjiang is prioritizing agriculture, specifically dealing with information services, scientific and technological support, industrial parks, agricultural products and processed goods for export. Xinjiang is rich in agricultural resources—with abundant sunlight, heat, and water—and is focusing on organic and green agriculture. Therefore, Xinjiang is able to grow grain, cotton, hops, tomatoes, cantaloupes, grapes, pears, onions, garlic, pumpkins, carrots, potatoes, peppers, beets, safflower, medlars, pomegranates, saffron, and more. There will also be an emphasis on livestock, forestry, and orchard industries.

Due to its production of cotton, fine wool, and cashmere, Xinjiang is also prioritizing the textile industry, and will look to spinning, weaving, printing, and dyeing as value-added activities. In addition, textile-supporting industries such as warehouses, transportation, packaging, product development, international trade, and trade show facilities are being developed.

There is a noticeable lack of many of the major Chinese state-owned entities in Xinjiang, and the new plans and new cities, particularly in Urumchi and Khorgos, may give one pause. We have seen pictures of empty cities elsewhere in China, with office buildings and apartment blocks laying empty years after they were built. In addition, the economic crisis continues and shows no signs of improving in the near future.

That said, due to the One Belt initiative, there could be an economic rationale to the new construction in Urumchi and Khorgos, where there might not have been in other areas of China. If even half of what China is planning is successful, I can foresee the population of Urumchi doubling in the next 10 to 20 years (it has already practically doubled in the last 15 years before this new initiative) and becoming the capital of all Eurasia. I can also imagine Khorgos filling out. However, I want to see how things will develop with the economic crisis and with the fact that China will have to do most of the investing and perhaps managing of the New Silk Road in Central Asia and other countries, which will be an expensive and massive effort.

With regard to foreign investment in Xinjiang itself, there were just 20 American companies operating in Xinjiang in 2015, so it remains to be seen how many of the projects in the region are bankable and will attract foreign investment. It will also be interesting to see, as wages rise in eastern China, if Chinese state-owned enterprises and some multinational corporations start to move factories to Urumchi and Khorgos due to the presumably lower wages and the new high-level infrastructure and logistics, which allow for quicker international export compared to the sea routes.

To conclude, I will lay out some areas where Xinjiang needs to improve to meet international standards and catch up with eastern China. In Xinjiang, including Urumchi, I noticed almost a complete lack of English-language skills

among the population, even in the service industries. This will have to change if the new One Belt initiative is to take shape.

In addition, many ATMs and vendors that accepted credit cards could not accept my American cards (only accepting Chinese cards, it appears). This will also have to change if Xinjiang wants to increase tourism and international visitors and investment. I also noticed other small things, such as the money-changing office in the airport being closed at night. In such a major airport, the currency conversion offices should be open 24 hours a day.

Cleanliness in bathrooms and smoking are also key issues. Smoking appears almost everywhere—in restaurants, hotels, airport bathrooms, and government buildings—and many hotels and restaurants lack non-smoking rooms or seating areas. Many of the taxi drivers smoke, and you can smell it in their vehicles. One of my taxi drivers just started smoking without even asking me if I minded.

In addition to often smelling like cigarette smoke, bathrooms—even in restaurants—tend to lack soap or just have a single soap dispenser. They lack paper towels or hand dryer or just have a single hand towel for everyone, and some bathrooms lack sit-down toilets, only using squat or hole-in-the-ground versions.

In general, our delegation visitors who came from eastern China commented that the pace of life was much slower in Xinjiang, though to me, it was still a good deal faster than anywhere in post-Soviet Central Asia (the most similar pace would be that of Tashkent, capital of Uzbekistan). They also commented on how clean and clear the air was and how grateful they were to see the greenery and beautiful blue skies. Therefore, the all-season tourism potential is immense, and Xinjiang is paying attention to that.

One point to note is that there has previously been ethnic tension in some areas of Xinjiang between the Han Chinese and Uyghurs, including in Urumchi and in Yining, but I did not notice any friction at all as I walked the streets of these cities. This does not mean that issues don't exist or that there might not be any problems in the future, but I did not notice any particular ill feelings or hostilities between the various ethnic groups or any ill will anywhere towards foreigners.

I have many years of work experience in post-Soviet Central Asia, and speak Russian, Persian and some of the Turkic languages. I have also worked in the non-profit, private and government sectors. I thoroughly enjoyed Xinjiang and my motto is to go where the opportunity is. I will clearly need to learn Chinese in the future and to look at possibly moving to Xinjiang down the road. What has been done in the east of China will start to occur in the west, and the New Silk Road will help Xinjiang on its way.




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