Reforms in Uzbekistan

Development and liberalization of Uzbekistan economy throughout the last two decades are characterized by large- scale drastic reforms in the socio-economic system of the country. Increasing investment activities evidence significant improvements in business environment and the sustainable economic growth in recent years. Thus, the vol- ume of capital investments made throughout 2016 comprised $16.6 billion, a 9.6 percent increase compared to 2015 of which foreign investments and loans amounted to $3.7 bil- lion. Projected volume of foreign investments for 2017 is $4.5 billion. It should be noted that nearly $60 billion of foreign investments were drawn to the economy of Uzbekistan from 1991 through 2016, which allowed for ac- celerated implementation of modernization programs, technical and technological renewal of industries through introduction of modern technologies. With recent ongoing economic reforms and transitions the reasons to invest in Uzbekistan economy have become even more solid.

Presidential support

Following inauguration in December 2016 the President of Uzbekistan Shavkat Mirziyoyev approved an “Action Strategy for Five Priority Areas for 2017-2021” that provides, inter alia, for an active attraction of foreign investments to various sectors of the economy and regional development by improving investment climate of the country. These priority areas stipulated in the Decree, which refl ects a long-term vision of the President for the country’s future develop- ment strategy, are the following

To further support this objective the President signed a Decree “On the Formation of the State Committee of the Republic of Uzbekistan for Investments” in March 2017, which created an authorized state body responsible for coordinating formation and implementation of a unified state investment policy and attracting foreign investments. The Committee is formed with the aim to fully develop investment potential of the country and create the most favorable conditions for attracting foreign direct investment, expand cooperation with international fi nancial institu- tions, leading foreign companies and banking structures, as well as increase effi ciency of for- eign investment utilization.

Reforms in Uzbekistan Macroeconomic and political stability

Over the past 26 years since Uzbekistan de- clared independence from the Soviet Union the country has enjoyed political stability with no serious crises or political unrest. The democratic change of power through transparent elections in December 2016 is another indicator of politi- cal stability and adherence to democratic values and attitudes of the country’s leadership.

Macroeconomic stability is determined, in particular, by the positive balance of trade which averaged $808.25 million from 2006 through 2016. In addition to that Uzbekistan recorded a trade surplus of $455 million in 2016. Another indicator of stable economic growth is low external debt, which does not exceed 18.5 per- cent of the country’s GDP. Since 2014 the state internal debt equaled to zero, indicating healthy monetary and fiscal system. Uzbekistan has recorded a triple budget surplus for 10 consecu- tive years and surplus of balance of payment for over 14 years. The country’s foreign exchange reserves cover 24 months of import.

GDP growth rate

Despite the ongoing global financial and eco- nomic crisis, GDP growth rate in Uzbekistan from 2000 through 2016 has averaged 8.1 percent. According to the World Bank’s “Global Economic Prospects” Uzbekistan is the fifth fastest growing economy in the world with an- nual GDP growth rate at 7.8 percent in 2016. Furthermore, Uzbekistan has set a target to in- crease its GDP at least two-fold by 2030. Due to drastic structural reforms, the country intends to achieve accelerated growth of industry by bringing its share in GDP to 40 percent within the next fi ve years against 33.5 percent record- ed in 2015.