Central Bank of Uzbekistan expects economic growth rates within 6 percent

Business Materials 29 December 2017 12:58 (UTC +04:00)

Baku, Azerbaijan, Dec. 29

By Nigar Guliyeva – Trend:

In 2018, Uzbekistan's economic growth rate will be 5.5-6 percent, reads a statement of the Central Bank of Uzbekistan on the main directions of monetary policy for 2018, published on Dec.29.

"In general, according to preliminary forecasts, in 2018, the economic growth rate will be 5.5-6 percent in the country. It is expected that the state budget will be implemented with a surplus and surplus of the balance of payments the country, including the current account," the statement reads.

The Central Bank notes that the positive balance of payments and current account, in turn, will serve as a strengthening factor for the stability of the exchange rate of soums.

"In the upcoming 2018, certain inflationary pressures in the economy and price growth risks are expected to persist, mainly due to non-monetary factors: adjustment of domestic prices to external prices in the context of liberalization of economic activity, rising prices for energy resources, especially gasoline, diesel fuel and electricity as a result of increasing production costs in market conditions, including due to increased costs of importing the necessary raw materials, increasing wages, pensions and other social benefits ," the statement reads.

"The expansion of socio-economic development programs, as well as acceleration of construction work, can lead to a relatively rapid increase in the aggregate, including investment, demand, which will exert increasing pressure on inflation, the Central Bank notes.

In 2018, the Central Bank also expects raise in inflation risks due to external factors.

"In particular, the increase in the volume of exports due to the growth of external demand from the main trading partners and the strengthening of the competitiveness of local producers as a result of economic and monetary liberalization, the increase in international remittances, as well as positive expectations regarding the flow of capital into the country from external sources can lead to increasing pressure on price stability in the domestic market," the statement said.

The Central Bank notes that the rate of inflation in 2018, as in the current year, will be high - 11.5-13.5 percent on an annualized basis.

Taking into account the existing inflation expectations and risks, the Central Bank intends to maintain the established refinancing rate during 2018.

Earlier, the Uzbek president reduced the forecasted for economic growth in Uzbekistan this year to 5.5 percent from 7 percent.