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Eastern Caspian
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Environment and Security
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velopment priorities. According to the Min-
istry of Foreign Affairs of Turkmenistan, in
order to achieve more efficient use of state
funds, the new President signed a decree on
4 February 2008 ordering the closure of the
FERF. Although this measure may contribute
to more transparent and efficient use of the
state’s financial resources, the country will
still have to deal with the challenges repre-
sented by its dependency on revenue gener-
ated by the extraction of natural resources.
Turkmenistan’s Balkan province displays
similar trends to its Kazakh neighbours,
Mangystau and Atyrau. The province has a
marked industrial profile, the main drivers of
the regional economy being fuel and energy,
chemicals (almost 50% of GRP), construc-
tion (26%), transportation and communica-
tion (10%)
33
. Since 2000 the province’s in-
dustrial output has doubled, largely due to
the energy sector. The transportation sector
is growing steadily. The port of Turkmen-
bashy is the largest terminal in Turkmeni-
stan and an important stretch of the interna-
tional corridor linking Europe to Central Asia
via the Caucasus. The province contributes
roughly 18–23% of the country’s GDP but
accounts for the largest share of added
value in the production sector (33.7%). The
Balkan province produces 95% of the coun-
try’s oil and about 15% of its natural gas. It
has consequently attracted almost 40% of
FDI, at a national level, primarily directed
towards the development of the fuel-and-
energy industry.