Baku, Azerbaijan, Nov.17
By Nigar Guliyeva – Trend:
The International Monetary Fund announced that Uzbekistan’s next reform steps should aim at improving the investment climate and protecting the vulnerable segments of the population, reads an end-of-mission reports of the IMF.
An IMF mission led by Albert Jaeger visited Tashkent during November 7–16, 2017, to discuss the authorities’ plans to continue reforms of the economy and to update the macroeconomic framework.
The IMF mission welcomed the authorities’ continued efforts to adopt a more effective macroeconomic stabilization framework and to improve the economy’s investment climate, in line with the priorities of the development strategy of the President of the Republic.
The mission noted that the liberalization of the foreign exchange market in early-September was a significant first step, which seemed to be welcomed by all stakeholders.
stressing that the next reform steps should aim at improving the investment climate and protecting the vulnerable segments of the population, them mission noted that improved international commodity prices and trading partner growth will provide a favorable backdrop to the authorities’ reform efforts.
“Growth prospects remain broadly favorable, but there are risks to growth during this phase of economic transformation, as earlier experiences of other transition economies suggest," according to the report.
The mission welcomed the authorities’ focus on keeping inflationary pressures in check. To be able to more effectively control inflation, the Central Bank of Uzbekistan (CBU) is overhauling its monetary framework and is enhancing its operational capabilities.
Fiscal policy will have to continue to play the leading role in stabilizing the economy. In this context, the mission noted that it will be important that fiscal policy, defined as including all on- and off-budget operations, will need to remain tight going forward to help contain inflationary pressures.
“Following the liberalization of the foreign exchange market, the banking system remains well-buffered. But there was agreement that banks’ asset quality and liquidity needs to be monitored carefully, especially against the backdrop of the restructuring of the large state-owned enterprise sector," it reads.