Number of risks may affect implementation of Uzbekistan's strategy for 2022-2026, expert says

Uzbekistan Materials 23 November 2022 17:56 (UTC +04:00)
Number of risks may affect implementation of Uzbekistan's strategy for 2022-2026, expert says
Natavan Rzayeva
Natavan Rzayeva
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BAKU, Azerbaijan, November 23. In the medium term, a number of risks remain that can significantly affect the results of the implementation of the Strategy of Uzbekistan for 2022-2026, an independent economist and researcher Ulugbek Kamaletdinov, told Trend.

Uzbekistan has adopted "New Development Strategy for 2022-2026" to ensure economic stability across country. Among the goals - to reduce inflation to 9 percent in 2022 and to 5 percent in 2023, to reduce budget deficit to 3 percent. By the end of 2026, the share of the private sector in banking assets is estimated to reach 60 percent.

From 2023, it is planned to reduce value added tax to 12 percent. The income tax for businesses such as banking, finance and telecommunications will be reduced to 15 percent.

It is planned to increase energy efficiency by 20 percent and to reduce harmful emissions by 10 percent.

“The accelerated growth of the population of Uzbekistan over the past 7-10 years increases pressure on the labor market, may lead to an increase in unemployment and poverty, especially among women and youth, which will require new policies of the government, including those aimed at expanding legal external labor migration,” Kamaletdinov said.

According to him, the post-pandemic effect of the breaking of traditional foreign trade ties, the intensification of confrontation between the West and Russia, which is the main foreign economic partner of Uzbekistan, instability in Afghanistan, will have a negative impact on the expansion of Uzbekistan's foreign economic activity for a long time.

“The global transformation of trade and investment relations increases the risks of reducing foreign direct investment in the economy of Uzbekistan. However, a possible lack of investment can be offset by creating adequate conditions for relocated businesses from Russia, Ukraine, Belarus and Afghanistan,” Kamaletdinov said.

The economist stressed that the global redistribution of the energy market significantly increases the risks for the energy-intensive and resource-intensive structure of the economy of Uzbekistan, increasing the cost of export products.

“The country is already a net importer of oil and electricity, and in the medium term, we can talk about importing natural gas and raw cotton,” he said.

“Created and updated over the past 5-6 years, the system of public administration has become quite cumbersome and resource-intensive, and state regulation of economic activity has increased. A new stage of development requires reform in this area, where the expansion of the e-Government system can play an important role,” Kamaletdinov said.