ABSTRACT
This chapter examines the impact of the transition on living standards and welfare in the five Republics of former Soviet Central Asia: Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. At independence all of the newly formed Central Asian Republics (CAR) inherited high levels of human capital. Education and health care were universal and free and there were extensive social services and transfers. The Republics also, however, inherited economic structures that were heavily dependent on Soviet supply and trade networks. Russia was the main source of inputs and the main market for outputs. Transport and other infrastructure was designed to meet these needs and not necessarily those of the local economy. High social spending was supported by large budgetary transfers from Moscow. It is estimated that in the late 1980s/early 1990s such transfers were worth between 12 per cent of GDP (in Kazakhstan) to as much as 40 per cent of GDP (in Tajikistan).
