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Economy :
Agriculture is the main
component of Uzbekistan’s economy. Livestock is reared in the steppes
while a variety of crops, including grains, fruit and vegetables, is
grown in the more fertile valleys. In addition, vast quantities of
cotton are produced in formerly arid areas fed by artificial
irrigation schemes. Uzbekistan consumed (and still does) over
three-quarters of the water available to the ex-Soviet Central Asian
Republics. The result of this ill-conceived plan has been one of the
world’s greatest ecological catastrophes in the Aral Sea, once among
the world’s largest inland seas, which has been deprived of the bulk
of its river sources and has consequently contracted to one-third of
its original size. The country has substantial natural resources,
especially natural gas which is an important export earner, and oil.
Uzbekistan also boasts the world’s largest opencast gold mine and has
deposits of silver, uranium, copper, lead, zinc and tungsten.
Machinery and vehicles account for the bulk of manufacturing output.
Self-sufficiency in food and energy products meant that Uzbekistan did
not suffer as badly as other republics from the collapse of the Soviet
Union and its economic system. In principle, this made reform a
somewhat easier prospect than for many of Uzbekistan’s neighbours. In
1992, Uzbekistan joined the IMF, the World Bank, and the European Bank
for Reconstruction and Development (as a ‘Country of Operation’). A
new currency - the Sum - was introduced in 1996. Economic reform began
in earnest in 1994 but the Government has since blown hot and cold
over putting it into effect. Much of the economy has now been
transferred into private ownership, but key sectors remain under state
control and the financial crises of 1997/98 in Asia and the
Russian Federation persuaded the Government to put many reform
plans on hold. Currency and export controls were introduced in an
attempt to insulate the economy, as far as possible, from external
influence (although the Government now plans to make the Sum fully
convertible in the near future). The lack of reform has also deterred
many potential foreign investors. Uzbekistan’s recent economic
performance has been patchy.
Current annual GDP growth is 4.2 per cent, while inflation is around
20 per cent. Uzbekistan has joined the Economic Co-operation
Organisation of ex-Soviet republics and former socialist countries.
Its main trading partners are the Russian Federation, Kazakhstan
and Tajikistan, along with Switzerland (the largest
export market after the Russian Federation), Germany,
Korea (Rep), the UK and Turkey.
Business :
Uzbekistan’s government is actively encouraging
foreign investment, particularly in the processing industries for its
raw material output. The January 1994 decree puts into law a number of
tax incentives for foreign investors, formally lays out guarantees for
property protection, and promises a faster and less bureaucratic
method of registration for foreign concerns. Other areas in which the
Uzbeks would like to encourage foreign investment include the
financial sector, energy production, extraction and processing of
mineral raw materials, textiles, telecommunications, tourism and
ecology. All foreign companies currently have to be registered with
the Ministry of Foreign Economic Relations. Office hours:
Mon-Fri 0900-1800.
Commercial Information :
The
following organisations can offer advice: Agency for Foreign Economic
Relations, ul. T Shevchenko 1, 700029 Tashkent (tel: (71) 138 5000 or
5123/5; fax: (71) 138 5200/5100/5252; e-mail :
secretary@mfer.uz; website:
http://www.afer.uz);
or Uzbekistan Exhibition Centre, 107 Amir Temur St, 700084 Tashkent (tel:
(71) 134 4545 or 350 973; fax: (71) 134 5440/4088; e-mail:
info@uzexpocentre.uz; website:
http://www.uzexpocentre.uz). Information can
also be obtained from the US Department of Commerce Business
Information Service for the Newly Independent States, USA Trade
Center, Stop R*Bisnis, 1401 Constitution Avenue, NW Washington,
DC, 20230, USA (tel: (202) 482 4655; fax: (202) 482 2293; e-mail :
bisnis@ita.doc.gov; website:
http://www.bisnis.doc.gov). |
