With a population of 28 million (the largest in Central Asia), Uzbekistan has the potential to be a large market. It has a dynamic, literate, entrepreneurial population and a relatively good infrastructure.
Economic growth in Uzbekistan was 8.1% in 2009, despite the global economic crisis. GDP was $31 billion, and GDP per capita reached $2,800. During the last several years the Uzbek economy developed rapidly, with an average annual rate of real GDP growth of 7 %. The growth was fueled primarily by high prices for export commodities such as hydrocarbons, cotton, gold and other minerals.
The government reported that in 2009 foreign direct investment increased significantly. The government’s investment program predicts an additional $2.4 billion influx of foreign direct investment in 2010. The Uzbek government established a free industrial economic zone in the Navoi region (FIEZ Navoi), which provides tax and customs free facilities for foreign investors. As in past years, machinery and equipment were the largest import items, and overall imports increased by an estimated 25.8% in 2009, according to government statistics.
Oil & gas exploration, extraction and processing
Power generation and distribution equipment
Construction equipment and machinery for production of building materials
Textile processing equipment
Automotive and agricultural manufacturing
Food Processing and packaging
In theory, under Uzbek law foreign investors and investments receive treatment equal to that afforded local investors in all sectors without exceptions. However, experience is mixed and investors should consult the Country Commercial Guide (referenced below) for more background.
Most of the challenges in Uzbekistan are characteristic of the region. They include but are not limited to:
Non-transparent and difficult customs clearance
Lack of convertibility of the local currency
Underdeveloped banking sector
Non-transparent rules and regulations
Unpredictable business environment with excessive and unpredictable government control and interference
More detailed information about market opportunities and challenges in Uzbekistan and the Uzbekistan Investment Climate Statement are available at: www.export.gov/uzbekistan1
Additional info about market opportunities is also available at: www.investuzbekistan.uz2
USA-Eurasia Business Conference3
October 11-12, 2010
For key local events, please visit: www.ite-uzbekistan.uz
For more information, please contact:
U.S. Embassy, Tashkent
Benjamin Smith, Economic Officer
Phone: (998-71) 120-5450
Jakhongir Mavlany, Economic Specialist
Phone: (998-71) 140-2120
Murod Madjidov, Economic Specialist
Phone: (998-71) 140-2119