Tashkent, Uzbekistan, May 10
By Demir Azizov– Trend:
The European Bank for Reconstruction and Development (EBRD) has left the Uzbek real GDP growth forecast for 2017 unchanged at the level of 6.2 percent, according to the bank’s “Regional Economic Prospects in EBRD Countries of Operations May 2017” updated report.
In November of 2016, the EBRD forecast 6.2 percent real GDP growth of Uzbekistan for 2017 due to the pressure of external factors related to prices on global markets, as well as internal structural problems.
“The officially reported growth in Uzbekistan in 2016 remained strong at 7.8 percent, mainly internally driven, supported by good performance in agriculture, construction retail trade and services sectors,” said the EBRD’s May 2017 updated report.
“Growth in 2017 is expected to moderate to 6.2 percent, negatively affected by dislocations in domestic economy as a result of tight currency controls and dual exchange rates, which constrain the development of more competitive industries and discourage FDI (foreign direct investment),” the EBRD said in its report.
The pace of Uzbek soum’s depreciation has accelerated in the first four months of 2017, with the official rate weakening by 13 percent and the black market rate hitting around 7,800 soums per US dollar versus an official rate of 3,706 soums per US dollar at the end of April 2017, according to the report.
“The [Uzbek] government has announced a series of reforms to improve the investment climate, including plans to liberalize the exchange rate regime, which would be a significant policy development,” said the report.
In 2018 the Uzbek economy can be expected to grow by 6.5 percent, provided by a more positive investment environment, higher energy export prices, a rebound in remittances inflows and supporting private consumption, the EBRD said.
Uzbekistan joined the EBRD in 1992. According to the EBRD, the bank invested almost 900 million euros in the country and implemented about 54 projects in energy, entrepreneurship, transportation, construction, development of mineral resources, etc.