BAKU, Azerbaijan, November 25. Strong economic growth is continuing in Uzbekistan in 2022, Trend reports via European Bank for Reconstruction and Development.
According to the bank, the country’s economy grew by 5.8 percent year on year in the first three quarters of 2022, supported by a boost in fixed capital investment (up 5 percent year on year).
From January to September 2022 growth was broad-based, with particularly strong gains in construction (up 6.3 percent year on year), retail trade turnover (up 10.8 percent year on year) and services (up 15.4 percent year on year).
In the first nine months of 2022 exports of goods and services grew by 35.7 percent year on year, driven by a more than doubling of gold exports (reaching 21.1 percent of total exports). Imports rose by 22.3 percent year on year in the same period.
Inflation has reached double-digits, prompting policy rate adjustments. The inflation rate was 12.23 percent year on year in September 2022. The conflict in Ukraine initially led to a depreciation of Uzbekistan’s national currency. To stabilize the foreign exchange market and limit the pass-through effect on prices, the Central Bank of Uzbekistan raised the policy rate by 300 basis points to 17 percent in March 2022.
Timely actions of the regulator helped Uzbekistan som to regain its pre-conflict value. Subsequently, the central bank decreased its policy rate to 16 percent in June, and further to 15 percent in July. Foreign currency-denominated loans account for 47.5 percent of total loans. Non-performing loans have continued to decline, reaching 4.7 percent of total loans by September 2022 compared with 5.8 percent a year previously.
The fiscal position of Uzbekistan is strengthening. The state debt-to-GDP ratio has been declining since the first quarter of 2021. As of 1 April, 2022 external public debt amounted to $23.4 billion and accounted for 32.9 percent of GDP.
Remittances have increased dramatically during 2022, rising by 96 percent year on year in the first half of the year.
The economy is forecast to grow at 5.5 percent in 2022, and 6.5 percent in 2023. Uzbekistan’s growth continues to rely on its large and industrious labor force, domestic market size, strong and diversified manufacturing capacity, and market-oriented reforms.