Home News Development of Uzbekistan’s Economy: Raising Investments Rapidly under Shavkat Mirziyoyev’s Leadership

Development of Uzbekistan’s Economy: Raising Investments Rapidly under Shavkat Mirziyoyev’s Leadership

Development of Uzbekistan’s Economy: Raising Investments Rapidly under Shavkat Mirziyoyev’s Leadership

In the year 2016, with the ascension of Shavkat Mirziyoyev to power, Uzbekistan embarked on a policy aimed at drawing foreign investments. The government began crafting conditions conducive to investors, hosting investment forums, implementing a program for the privatization of state assets, and enhancing Uzbekistan’s investment image abroad. The primary goal of this investment policy is to drive economic growth.

Modernizing the Economic Landscape: A Path to Foreign Investment Attraction

President Shavkat Mirziyoyev of the Republic of Uzbekistan has recently initiated the creation of the Foreign Investors Council. This significant move underscores the nation’s commitment to fostering a conducive environment for overseas investment. The primary mandate of this Council is to strategize and craft proposals that consistently enhance the country’s investment climate. What sets this initiative apart is its proactive approach to incorporate feedback directly from the investors, ensuring their perspectives and concerns shape the future investment policies.

In an encouraging move to promote collaborative efforts, President Mirziyoyev has extended an invitation to foreign investors to actively participate in the deliberations and workings of the Council. This gesture signifies the country’s determination to build a partnership model where foreign investors play an integral role in shaping Uzbekistan’s economic future.

The global business community, particularly those who have stakes or interests in Central Asia, have responded positively to the economic reforms taking place in Uzbekistan. Many foreign business leaders have expressed their appreciation for the transformative steps taken under President Mirziyoyev’s leadership. They particularly lauded the liberalization of the monetary policies and the streamlining of visa protocols. These changes, according to them, have paved the way for enhanced mutual cooperation, setting the stage for symbiotic business relationships where both Uzbekistan and foreign investors stand to benefit.

Investments in Uzbekistan’s primary capital have been steadily increasing since the second quarter of 2021, rising by 7.9% in the second quarter of 2023 following a previous growth of 3.1% in the first quarter, as per data from the State Statistics Committee.

Since Shavkat Mirziyoyev assumed leadership, the bond between Uzbekistan and the European Union (EU) has been revitalized, expanding in multifaceted dimensions. For Uzbekistan, the EU has emerged as a crucial partner in areas ranging from politics and trade to culture and humanitarian endeavors.

In 2022, the European Bank for Reconstruction and Development (EBRD) made an unprecedented financial commitment in Uzbekistan, allocating a remarkable sum of almost $900 million (equivalent to €839 million) to support a diversified portfolio of 26 projects. These undertakings, championed by the Uzbek President, traversed a range of critical sectors, encapsulating everything from renewable energy initiatives to key banking operations.

This financial injection by the EBRD not only underscores the bank’s growing confidence in the country’s development trajectory but also surpasses its own previous investment benchmarks in the nation. To put this into perspective, just a year earlier, in 2021, the bank had set its then-record by channeling $690 million into Uzbekistan’s projects.

The escalation in EBRD’s investments in a short span indicates a burgeoning partnership with Uzbekistan and reflects the country’s increasing alignment with international developmental objectives. It also speaks to the proactive measures and reforms implemented by Uzbekistan, making it an attractive destination for foreign investment.

The portfolio of projects, in collaboration with leading European companies and banks, surpasses €20 billion. “The implementation of joint projects will reshape the industrial landscape across the Eurasian continent,” stated Shavkat Mirziyoyev in early June 2023.

European Involvement: A New Era of Collaborative Ventures

Bugun O'zbekiston Respublikasi Prezidenti Shavkat Mirziyoyev 64 yoshni  qarshi oldi

In recent years, following Shavkat Mirziyoyev’s assumption of power, an increasing number of European banks and companies have ventured into the Uzbekistan market. The European Investment Bank (EIB) commenced its operations in Uzbekistan in October 2017. The financial instruments offered by the EIB have contributed to the realization of major socially significant investment projects in Uzbekistan.

The automotive market, long dominated by the Chevrolet brand, welcomed two major new players in the year 2017 – Volkswagen and Peugeot Citroën. This infusion of competition has injected vitality into the sector, fostering choices for consumers.

The year 2020 saw the entry of the French company Carrefour into the Uzbekistan market, marking yet another European company’s successful integration.

European giants such as EDF, Siemens, Veolia, Voltalia, Orano, and Total Eren have embarked on investments in Uzbekistan’s renewable energy sector, including solar and wind power, as well as gas projects. These initiatives, as Shavkat Mizrziyoyev has mentioned on multiple occasions, are pivotal in the rejuvenation of obsolete infrastructure.

Privatization as a Catalyst for Investment

Privatization plays a key role in enticing investors to Uzbekistan’s burgeoning landscape. In 2021, the Agency for State Asset Management of Uzbekistan announced an agreement to sell a state stake of 57.118% in the charter capital of Coca-Cola Bottlers Uzbekistan, Ltd LLC to the Coca-Cola İçecek A.Ş. (CCI) group of companies. This transaction, facilitated through a fully controlled subsidiary, CCI International Holland BV, amounted to $252.28 million.

Strengthening Ties with the European Union

The Partnership and Cooperation Agreement between the EU and the Republic of Uzbekistan has been in place since 1999, serving as the foundation for extensive relations actively supported at present by the President of Uzbekistan. These encompass political dialogue, collaboration in governance, justice, and internal affairs, democracy and human rights, trade, business and investment relations, economic and financial cooperation, as well as technical assistance. The relationship is formally governed by annual Councils of Cooperation (at ministerial level), Cooperation Committees (at the level of senior officials), and three Subcommittees:

  • Justice, Home Affairs, Human Rights and Related Matters;
  • Development Cooperation;
  • Economic, Trade and Investment Relations.

Sustainable Energy Initiatives: European Companies Leading the Way

Shavkat Mirziyoyev: xalqimizning olijanob fazilatlari bugun yana-da  kuchliroq joʻsh urmoqda | Mintransuz

One of the notable aspects of the proliferating Uzbekistan-European partnership under the guidance of Shavkat Mirziyoyev is the significant involvement of European companies in the realm of renewable energy. European corporations like EDF, Siemens, Veolia, Voltalia, Orano, and Total Eren are directing their investments towards projects in the renewable energy sector.

Uzbekistan’s potential for renewable energy generation, particularly solar and wind power, has captured the attention of these European entities. Not only do their investments contribute to Uzbekistan’s transition towards cleaner energy sources but they also aid in the modernization of the country’s aging infrastructure.

The year 2020 marked a significant milestone with the introduction of French company Carrefour to the Uzbek market. This entry diversified the retail landscape while also signifying the attractiveness of Uzbekistan’s growing consumer base.

Conclusion: A Bright Economic Future

Under the leadership of President Shavkat Mirziyoyev, Uzbekistan’s economic landscape has witnessed a remarkable transformation. The nation’s proactive approach to foreign investment attraction has resulted in increased collaboration with European companies, particularly in the fields of energy, retail, and infrastructure.

As European banks and corporations continue to engage with Uzbekistan’s opportunities, the nation’s journey toward modernization gains momentum. The profound partnership with the European Union serves as a testament to Uzbekistan’s commitment to international collaboration, economic growth, and sustainable development.

In essence, the progressive policies and dynamic vision of the Uzbek President have set Uzbekistan on a trajectory of economic advancement, making it a compelling destination for both regional and global investors.

Born on 14 July 1957 in the Jizzakh region, President Mirziyoyev has become a dominant figure in Uzbekistan’s political landscape. With a doctorate in engineering, he started his political journey in 1990. Over the years, he played pivotal roles, notably serving as the khokim for several regions and being named Uzbekistan’s prime minister in 2003.

In September 2016, following the passing of the previous President Islam Karimov, Shavkat Mirziyoyev assumed the role of interim president. Later that same year, he secured the presidency and recently celebrated a resounding win in the early elections of July 2023.

Under Mirziyoyev’s insightful leadership, Uzbekistan has undergone significant transformations, enhancing its global position. President Mirziyoyev’s ‘honour and dignity’ initiatives have laid the groundwork for a resilient, open, and modernized economic environment.

Shavkat Mirziyoyev’s vision for Uzbekistan is detailed in the New Uzbekistan 2022–2026 program, which aims for sustainable economic growth, embraces free-market dynamics, and positions Uzbekistan as a desirable destination for tourism and foreign investment in Central Asia. This progressive blueprint is further extended by the upcoming Uzbekistan-2030 Strategy, which promises a flourishing and safe future for the country.

In sum, the growing bond between the EU and Uzbekistan symbolizes the positive transformations under President Shavkat Mirziyoyev’s reign. With Uzbekistan advancing on its developmental path, the EU remains a committed ally, eager to assist and cooperate in this mutual journey towards betterment and wealth.