[From the Scene] Uzbekistan pursues economic reforms to attract foreign investment

2024. 5. 3. 19:11
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Leaders, policy makers, industry experts and investors discuss foreign investments, reforms and strategies to achieve Uzbekistan's ambitions
Uzbekistan President Shavkat Mirziyoev delivers an address during the opening ceremony of the Tashkent Investment Forum held at Tashkent City Congress Hall in Tashkent on Thursday. (Sanjay Kumar/The Korea Herald)

TASHKENT-- Uzbekistan’s President Shavkat Mirziyoyev has pledged to enhance foreign investment through wide-ranging economic reforms, including the implementation of new investment laws specifically designed for foreign investors.

At the third edition of the Tashkent International Investment Forum on Thursday, Mirziyoyev delineated Uzbekistan's comprehensive economic reforms aimed at ensuring that "every entrepreneur feels free and confident" in the country.

"Our main goal is to make Uzbekistan a reliable and long-term partner for foreign investors," the president said at the forum.

"Our country is committed to developing market economy, ensuring reliable protection of investors' rights, further improving the favorable investment and business environment, creating more comfortable conditions for fair competition, ensuring the protection of private property and the independence of the judicial system."

Akylbek Zhaparov, Chairman of the Cabinet of Ministers of Kyrgyzstan speaks at the opening ceremony of the Tashkent Investment Forum held at Tashkent City Congress Hall in Tashkent on Thursday. (Sanjay Kumar/The Korea Herald)

The forum saw participation from more than 2,500 foreign delegates, representing 93 countries. Among them were government leaders, heads of major companies, and representatives from prominent organizations such as the United Nations, the European Bank for Reconstruction and Development, the Organization of the Petroleum Exporting Countries, and the Shanghai Cooperation Organization.

Speaking at the forum, the Uzbek President presented several specific proposals aimed at the protection of investors' rights.

Firstly, Mirziyoyev announced the adoption of the new Law "On Investments," meticulously crafted in accordance with the regulations and standards of the World Trade Organization.

An International Commercial Court is set to be established to strengthen the legal system, and special laws will ensure efficient court decisions, according to the Uzbek government.

Industrial zone reforms are aimed at attracting foreign investment for high-tech projects by expanding operator activities, lifting zone restrictions, and extending land leases.

Deputy Secretary-General of the UN and Executive Secretary of the European Economic Commission, Tatiana Molcean, interacts with reporters at the Tashkent Investment Forum held at Tashkent City Congress Hall in Tashkent on Thursday. (Sanjay Kumar/The Korea Herald)

The term for leasing land to foreign investors will be doubled to 49 years, with existing benefits and preferences remaining intact. These measures will be discussed further at the upcoming Foreign Investors Council meeting, said Mirziyoyev at the forum.

Uzbekistan has implemented several reforms to attract foreign investment and stimulate economic growth.

The president referenced the establishment of an anti-corruption agency, hosting international events and the inauguration of the Tashkent International Arbitration Center as notable examples of economic reforms.

He underscored the center's dedication to impartial dispute resolution, highlighting its panel of more than 90 esteemed arbitrators representing nations like the United States, United Kingdom, Italy, Sweden, China and the United Arab Emirates.

Panelists attend a discussion on Investment potential of the regions of Uzbekistan at the Tashkent Investment Forum held at Tashkent City Congress Hall in Tashkent on Friday. (Sanjay Kumar/The Korea Herald)

Recent laws offer tax exemptions on share dividends for three years, while the country is privatizing state shares in 250 large enterprises and 1,000 properties, with plans for IPOs for 12 enterprises.

Mirziyoyev also elaborated that Uzbekistan has implemented over 60 regulatory documents to enhance legislation and facilitate its accession to the WTO.

According to Mirziyoyev, the Uzbek economy nearly doubled in recent years with a six percent growth rate last year, alongside single-digit inflation, and maintained currency stability and foreign exchange reserves while attracting over $60 billion in foreign investments.

Investments in education have surged, with higher education enrollment increasing from 9 to 42 percent, the establishment of 200 institutions, and a visa-free regime for over 90 countries to attract global talent and investment, stated Mirziyoyev.

“By 2030, our goal is to double the people’s income and join the ranks of the upper-middle income countries,” he said, citing industrial zones to attract high-tech projects that align with 100 tasks of "Uzbekistan-2030," strategy to achieve doubling income, sustainable growth and favorable investment environment.

Umid Shodiyev, Chairman, Tourism Committee of Uzbekistan speaks at a panel discussion on Tourism and Cultural Heritage: attractiveness of the Central Asian region for foreign investors at the Tashkent Investment Forum held at Tashkent City Congress Hall in Tashkent on Thursday. (Sanjay Kumar/The Korea Herald)

Under the strategy, Uzbekistan aims to boost GDP per capita to join nations with above-average GDP and hinges on leveraging domestic resources and opportunities with foreign direct investment for a cluster system in pivotal industries, transitioning from raw materials to finished products to spur economic growth.

Mirziyoyev highlighted ambitious infrastructure projects aimed at transforming Central Asia into a global transit hub.

Plans include the construction of the Trans-Afghan railroad and upgrades to international airports in Tashkent, Bukhara and Urgench, in collaboration with foreign investors. Initial work has commenced on railways linking China-Kyrgyzstan-Uzbekistan and Uzbekistan-Afghanistan-Pakistan.

Uzbekistan is leveraging its abundant reservoir of critical minerals, extending invitations to international partners for projects involving deep processing and value chain augmentation.

The country aims for a digital transformation, foreseeing exponential growth in IT services and the establishment of innovative technology hubs. Additionally, Uzbekistan is focusing on modernizing its transport infrastructure, including expansions in railway networks and upgrades to airports, all aimed at catalyzing regional connectivity and rejuvenating the historic Silk Road trade route.

Ivo Bols, President of Air Products, an industrial gases company who attended the forum as an investor, interacts with The Korea Herald at the Tashkent Investment Forum held at Tashkent City Congress Hall in Tashkent on Thursday. (Sanjay Kumar/The Korea Herald)

Ivo Bols, President of Air Products, an industrial gases company who attended the forum as an investor, said that Uzbekistan created opportunities and reduced investment risks for companies like Air Products supporting large-scale projects in the energy and chemical sectors, with significant backing from teams based in Korea.

“People of Korean descent or Korean nationals also work here. It's a great example of how this blend of international expertise is coming together in the Central Asia region and more specifically here in Uzbekistan,” Bols told The Korea Herald.

Over 10 investment agreements were signed on the first day of the forum, with companies such as ACWA Power, Masdar and Bonafarm Group on large-scale cooperation in energy, geology, food processing and the adoption of green technologies, said the Uzbek Ministry of Investments and Foreign Trade.

UAE Minister of Economy, Abdulla Bin Touq Al Marri attends the Tashkent Investment Forum held at Tashkent City Congress Hall in Tashkent on Thursday. (Sanjay Kumar/The Korea Herald)

During the forum, Saudi Arabia and Uzbekistan signed an agreement to implement projects worth $18 billion in "green" energy, infrastructure, health care, and pharmaceutical sectors.

"Uzbekistan has shown a serious commitment to seeking a just and equitable energy transition, which is consistent with the Kingdom’s directions,” said Saudi Arabia's Energy Minister Abdulaziz bin Salman Al Saud at the forum.

“(Those) who really make reform are only courageous people with straightforward leadership skills,” said Al Saud applauding the Uzbek President.

By Sanjay Kumar(sanjaykumar@heraldcorp.com)

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