Tajikistan: Modernizing Traditional Crafts for Competitive Businesses

Challenge Tajikistan is a challenging place to start a new business. The remote geographic location, lack of seaport, shortage of arable land, widespread poverty, and regional economic turmoil affect all entrepreneurs. And women often face additional and unique barriers compared to their male counterparts, many of which reflect a complicated gender landscape, from overall lower levels of education among women, to enduring responsibilities for childcare and homemaking. While there are many issues that affect all entrepreneurs, such as access to markets and finance, understanding of legislation and taxation, and difficulties registering a business, there are also barriers that uniquely affect women. As a labour-intensive industry involving mostly a female labour force, the textile sector holds important socio-economic potential for value addition, employment creation and the improvement of the livelihoods of the local population. Despite government efforts in prioritizing its development and international development partners’ support, the carpet weaving and embroidery/textile sectors in Tajikistan is characterized by low productivity and hence low incomes for carpet weavers. Given the country’s rich carpet weaving, embroidery and artistry traditions, upgrading and expanding the industry would not only preserve and maintain the facilities, but would also contribute to their expansion with the potential engagement of the excess labour in production. Towards a Solution To address the above challenge, United Nations Industrial Development Organization (UNIDO), jointly with the Ministry of Industry and New Technologies of Tajikistan, collaborated on a project that aims to increase the productivity and competitiveness of Tajik enterprises in the carpet weaving and embroidering sector. This will be achieved by identifying regional and international sales markets, improving the technological cycle and industrial modernization, introducing innovative marketing tools, and developing national expertise to provide appropriate services to local enterprises on a sustainable basis. Thus, the project aims to address the following Sustainable Development Goals (SDGs): SDG 5, by facilitating a reduction in the gender wage gap and enhancing the position of women in beneficiary enterprises; SDG 9, by modernizing industrial facilities and promoting sustainable industrial development; and SDG 17, by mobilizing additional resources for developing countries through South-South and triangular initiatives such as the Eurasian Economic Union and the Silk Road Economic Belt. The project strengthened institutional cooperation between national governmental, and non-governmental and vocational training institutions, as well as private sector enterprises. This resulted in the establishment of a training centre and showroom for the demonstration of products designed and created by local craftsmen and enterprises. Three new and creative home textile and carpet collections were created as part of the joint brand ‘LA’AL Textiles’, and were demonstrated at more than 16 national and international exhibitions. Additionally, commercial contracts for the production of new products were signed with leading international hotel and retail chains in Tajikistan. LA’AL Textiles was established in 2015, bringing together nine companies producing mainly embroidery and carpets while struggling to make sufficient sales to maintain production and pay the salaries of their employees, most of whom are women. With the UNIDO technical cooperation project funded by the Governments of China and the Russian Federation, these pilot beneficiary companies were the subject of full enterprise diagnostic studies. This resulted in development and joint implementation of industrial modernization plans that help to improve the technological cycle, introduce innovative marketing tools, and develop new unique competitive products not only for the local market, but also targeting potential export markets based on the market positioning studies conducted. As part of the UNIDO project, over the period of two years, more than 500 Tajiks, most of whom were women, as well as marginalized groups such as refugees from Afghanistan, learned about and were coached on the production and market access cycle, including product design, personnel management, financial management of enterprises, and the marketing of finished products. The project covers transfer of expertise, know-how, best practices in developing the carpet weaving and embroidery industries of Azerbaijan, Iran, Italy and the Russian Federation with Tajikistan, which resulted in the creation of higher value-added home textile and carpet collections with considerable competitiveness potential in terms of new export markets. Through the involvement of the best international expertise, Tajik experts have enhanced their skills, which has helped to improve the quality and design of the local produce, thereby implementing targeted marketing strategies to identified local, regional and international market niches. Practices established in beneficiary enterprises as a result of the project will also stimulate the adoption of similar activities in other manufacturing sectors of Tajikistan. Overall, the project will stimulate diversification and better integration of the Tajik economy in regional and global markets. A specific focus of the project is to work with women- led or -owned enterprises, ensuring their participation in and benefiting from the project, and to highlight the importance of their participation in Tajikistan’s workforce. The project facilitated stronger involvement and potential employment for women from rural areas, refugees and women left behind with no income by immigrant worker husbands. To this end, the project conducted gender analysis and extensive capacity- building activities with major female participation and continues to enable beneficiary companies to expand by employing women. Two important findings arose from the gender analysis: first, while women make up approximately 80 per cent of the workforce of most of the beneficiary companies, the largest beneficiary companies employ more men than women. Second, women occupy lower management positions and earn lower salaries in these companies. In order to address these findings, UNIDO supported beneficiary companies in developing gender equality policies and objectives. Regular meetings with both management and employees were held to tackle issues related to women’s working conditions. Full alignment with national development priorities and national ownership guaranteed the long-term sustainability of the project. The project was initiated following a request from the Minister of Industry and New Technologies of Tajikistan for UNIDO’s technical assistance to contribute to the development of the country’s carpet weaving industry through the introduction of new technologies. During the implementation phase, national counterparts and beneficiary companies took full ownership of the project. Sustainable Development Goal target(s): 5.1, 5.5, 5.c, 9.2, 9.3, 9.5, 17.3 Countries/territories involved: Azerbaijan, Iran, Italy, the Russian Federation, Tajikistan Implementing entities: UNIDO Project status: Completed Project period: 2015 – 2017 URL of the practice: goo.gl/LmBRQT Contact: Name: Mr. Farrukh Alimdjanov, Industrial Development Officer, Department ofTrade, Investment and Innovation, UNIDO Email: F.Alimdjanov@unido.org