Audit Reveals $30 Million Loss at Tajikistan’s Rogun Dam Project

An independent audit has revealed a staggering net loss of approximately $30 million at Tajikistan’s ambitious Rogun Dam project. The findings, released by the local affiliate of Baker Tilly International, uncovered a $540 million accounting discrepancy, raising significant concerns about the project’s financial viability and operational effectiveness.

As the construction of the Rogun Dam progresses, it is poised to become the world’s tallest dam upon completion. However, the project has faced ongoing criticism for its potential to disrupt the regional water balance, which could lead to economic and social repercussions in the surrounding areas. Proponents argue that once operational, the dam will enhance Tajikistan’s economic independence by ensuring stable power supplies and generating revenue through electricity exports.

Financial Concerns and Audit Findings

According to a report from the Asia-Plus news agency, the audit for the fiscal year 2024 was issued with a “qualified opinion,” indicating that the accuracy of Rogun’s financial statements could not be fully confirmed. A particularly alarming element of the report highlighted the hesitation among international lenders to provide ongoing funding for the project until officials present a viable repayment plan for the billions in loans without significantly increasing public debt.

The audit noted that Baker Tilly auditors did not participate in routine inventory assessments of cash, fixed assets, and inventories at the end of 2024. This absence heightens the risk of potential misstatements in the financial documents. The firm did not elaborate on the reasons for their lack of participation in these standard audit procedures.

Despite these challenges, the audit indicated that Rogun had a net positive cash flow. Nonetheless, it still experienced a notable net loss of around $30 million in 2024, although this marked an improvement from the previous year’s loss of nearly $36 million. Furthermore, auditors pointed out that Rogun management was unable to provide sufficient information to accurately assess the value of the entity’s fixed assets, which it claims amount to approximately $5.3 billion.

Tajik officials maintain that the completion and full operation of the Rogun Dam are essential for the nation’s future energy security and economic development. The government argues that the project is not just an infrastructure investment but a cornerstone for enhancing the country’s energy independence and ensuring reliable power supplies for its citizens.

As the situation continues to evolve, the implications of the audit findings could impact both the project’s future and the broader economic landscape of Tajikistan. The need for transparency and effective financial management is paramount if the Rogun Dam is to fulfill its potential as a significant asset for the region.