Inflow of foreign direct investment in Uzbekistan sharply down

Business Materials 1 April 2019 17:28 (UTC +04:00)

Baku, Azerbaijan, April 1

By Fakhri Vakilov – Trend:

The net inflow of foreign direct investment in Uzbekistan in 2018 amounted to $624 million, which is three times less compared with the figures for 2017, Trend reports with reference to the Central Bank of Uzbekistan.

Central Bank states that the decline in investment flows is due to an increase in the volume of repatriation of investments under production sharing agreements (PSAs) - up to a $1 billion in 2018, compared to $524 million in 2017.

"Moreover, significant funds in 2017 were sent by foreign investors to carry out construction and installation work in order to organize the extraction of mineral resources in the framework of the PSA," said the Central Bank.

Reinvestment of income by foreign investors in 2018 increased 1.45 times compared with 2017, to $693 million, the volume of net portfolio investment by foreign investors increased to $13 million (an increase of 4.3 times).

In April 2017, the government of Uzbekistan signed a PSA in the investment block "Independence of Uzbekistan" with a consortium of investors - Gas Project Development Central Asia (GPD, a subsidiary of Gazprom International), Altmax Holding Ltd., JSC "Uzneftegazdobycha" (part of JSC "Uzbekneftegaz") with additional exploration and development of the gas field and with the construction of a gas processing complex in the Surkhandarya region.

In November of 2017, the co-owner of Globaltrans, one of the leaders of the Russian freight rail transportation market, and Andrei Filatov, chairman of the board of directors of the investment company Tuloma, acquired 37.5 percent of the project.

Since 2004, Lukoil has been operating in Uzbekistan on the basis of a PSA on the Kandym-Khauzak-Shady and South-West Gissar projects, and since the same year Gazprom has been participating in the restoration of gas production at the "Shakhpakhty" field. In October 2018, Gazprom EP International B.V. (a subsidiary of Gazprom) and Uzbekistan signed a PSA on a project to develop the Dzhel field.


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