OREANDA-NEWS. December 26, 2008.  For the people of Turkmenistan the year 2008 is marked with the number of the principal decisions aimed at maintaining and enhancing the country’s economic strength, increasing the people’s welfare, creating the firm guarantees for the successful development of the state for many years ahead. The fundamental structural transformations in the national financial and economic system allowed ensuring the stable and well-balanced development of all sectors in the period of transition to market economy. Building the new optimal national economic model meeting the modern requirements is a key aspect of the progressive reforms initiated by President Gurbanguly Berdimuhamedov. An important step on this way was the Resolution of the President on the establishment of the Stabilization Fund of Turkmenistan.

According to the Ministry of Finance and Development responsible for managing the Stabilization Fund, there were several conditions necessitating the establishment of the Fund. These include the need to create the guarantees of sustainable, consistent economic growth, to protect the national economy from the negative impact of the external factors that is of particular importance due to the global financial and economic crisis. The Fund will allow guaranteeing the high income level to citizens as well as creating new industries and new jobs through allocating the financial resources in the national and regional investment projects.

The monetary funds of the Stabilization Fund are accumulated from the remainders of the budget surplus funds of the State Budget over the previous years and the current year. These funds will be invested in Turkmenistan’s social and economic development as the transfers in implementation of the national programmes, application of advanced technologies and equipment.

The Stabilization Fund has two functions: saving and stabilizing. The saving function will be performed through accumulating the financial assets and their profitability with the moderate risk level – through investing the available monetary funds in the high liquid assets and realization of large-scale investment projects. The stabilizing function will be performed through applying the funds to maintain macroeconomic stability, a certain level of liquidity.

The funds of the Stabilization Fund will be applied that will have a positive effect facilitating the monetary policy and maintaining the high dynamics of economic growth. The funds of this strategic financial reserve should be applied effectively guaranteeing the highest return for the national economy. In particular, in the projects funded under the Turkmen leader’s programmes aimed at increasing the people’s welfare, technology modernization of the country.

The 2009 State Budget stipulates for the allocation of the certain revenues in the Stabilization Fund on continuing basis.

Turkmenistan’s high economic potential enables to implement the large-scale reforms in all sectors of the domestic economy particularly in the social sphere. The President’s decision to establish the Stabilization Fund evidences that the protection of the people’s interests is a priority of the Turkmen leader’s policy of progressive reforms reflected in the principle “a state for the people”.