Uzbekistan

Economic and political outline

Economic indicators | Foreign Trade in figures | Sources of economic information | Political outline

Economic indicators

Since its independence from the Soviet Union, the economy of Uzbekistan has been gradually moving to a free-market economy. But substantial structural reforms still need to be executed, particularly in the area of creating a healthy environment for foreign investments and freeing the agricultural sector from state control. The country’s GDP growth was 7.3% in 2006 and estimated between 9.1 and 9.5% for 2007. This growth can be attributed to the industrial sector that has seen a growth of 12% during the first nine months of 2007 and the services sector that has grown by 25%. The agricultural sector has seen a growth of 3.5% during the same period.
Uzbekistan is facing an inflation estimated at 12.5% for the year 2007, according to the FM whereas the official figures given are between 5 and 7%. For 2008, the FM provides the inflation rate as 9.8% as compared to an official estimation of 6 to 8%. The unemployment rate is also high. Low level of transparency coupled with high corruption exists in the government. An extremely restrictive trade regime is slowing down the economy.

GDP Indicators	2006	2007	2008	2009	2010
GDP (billions USD)	17.03	22.31	26.62e	32.24e	37.19e
GDP (constant prices, annual % change)	7.3	9.5	8.0e	7.5e	7.0e
GDP per capita (USD)	642.80	830.23e	978.94e	1,162.52e	1,325.14e
Inflation rate (%)	14.2	12.3	11.1e	10.6e	9.5e
Current Account (billions USD)	2.93	4.27	4.47e	4.14e	4.11e
Current Account (in % of GDP)	17.2	19.1e	16.8e	12.8e	11.1e

Source: IMF - World Economic Outlook Database

Note: (e) Estimated data

Main sectors of industry

Agriculture is the main pillar of the economy and contributes nearly 29.4% to the GDP. It employs roughly 44% of the active population. Cotton remains the main source of foreign exchange but is facing a decline. The revenues from the export of cotton contributed to 19% of the total earnings in 2005 and 17% in 2006 even though the price had increased by 10%. The other main crops are cereals, fruits and vegetables. Cotton, silk, and wool provide the basis for Uzbekistan's extensive textile industry. Traditional crafts such as silk dying and carpet weaving, discouraged under Soviet rule, have revived after independence.

The country has abundant natural resources. It is the 9th largest producer of gold in the world. Other major minerals present are: coal, zinc, copper and tungsten. The country is also an important gas and oil producer. The industrial sector contributes nearly 33.1% to the GDP. Machine building, metallurgy, food-processing, and the manufacture of chemicals, fertilizer, and building materials are leading industries. Along with gold, gas remains an important source of foreign exchange for the country.

Breakdown of economic activity by sector	Agriculture	Industry	Services
Value added (annual % change)	7.0	8.0	12.8
Value added (in % of GDP)	26.1	26.9	48.7
Employment by sector (in % of total employment)	n.c.	n.c.	n.c.

Source: World Bank - World Development Indicators - last available data.

Foreign trade in figures

The over-regulated trade policy adopted by the government is squeezing imports, with the objective of maintaining hard currency reserves. Uzbekistan's foreign trade revenues depend to a large extent on the international prices of gold and cotton. The countries of the Commonwealth of Independent States contribute to around one-third of its foreign trade.
In 2006 exports brought in 6.3 million dollars and continued to grow during the first three trimesters of 2007. Cotton remains the main source of foreign exchange for Uzbekistan but is facing a decline. The earnings from cotton exports contributed to 19% of the total in 2005 and 17% in 2006 even though the prices had increased by 10%. In 2007, the the country benefited from the record price of gold, that increased by around 30% between November 2006 and November 2007. The sale of gas had almost tripled in 2007, due to the doubling of prices, and also to the increase by 33% in the sale volumes.
The restrained increase in imports is due to the strict control policy as well as the extremely high customs barriers. However the reality is that there is a lot of smuggling at the borders. The country essentially imports capital goods, machines and chemical products.

Trade with Russia, the most important trade partner after the Union European, represents more than one-fourth of the total volume of Uzbek business, against 50% with the EU. Uzbekistan sells cars, cotton and almost 90% of its agricultural production to Russia. Russia in turn supplies manufactured products (equipment materials and arms).
Uzbekistan's other principal trade partners are: the U.S., South Korea, Germany, Japan, and Turkey.

Foreign trade indicators	2003	2004	2005	2006	2007
Imports of goods and services (annual % change)	1.3	18.7	4.4	5.7	9.5
Exports of goods and services (annual % change)	8.0	21.6	14.5	18.9	14.6
Imports of goods and services (in % of GDP)	30.6	32.7	28.7	25.9	22.2
Exports of goods and services (in % of GDP)	37.3	40.2	37.9	37.5	32.6
Foreign trade (in % of GDP)	67.8	72.9	66.5	63.4	54.8

Source: World Bank - World Development Indicators

Main partner countries

Main customers (% of exports)

Main suppliers (% of imports)

Source:

Main products

Main exports (% of exports)

Main imports (% of imports)

Source:

To see more products: More imports (Intracen Data)
More exports (Intracen Data)

Sources of economic information

Ministries: Ministry of Economy
Ministry of Finance
Ministry of Foreign Economic Relations, Investments and Trade
Statistical Office: State Committee of Statistics
Central Bank: Central Bank of Uzbekistan
Stock Exchange: Tachkent Stock Exchange (in Uzbek)
Online newspapers: Ekonomiceskoe obozrenie (in Russian)
Search Engines: Uzbekworld.com
Uzonline
Economic portals: Economic portal

Political outline

Executive Power

The President is both the chief of the state as well as the head of the government. He is elected by popular vote for a seven-year term. The President is the commander-in-chief of the armed forces and holds almost all the executive powers. He selects and replaces provincial governors. The Prime Minister and cabinet ministers are also directly appointed by the President with confirmation by the parliament.

Legislative Power

The legislature is bicameral in Uzbekistan. The parliament called Supreme Assembly consists of: the Senate (the upper house) having 100 seats with 84 members elected by regional governing councils to serve five-year terms and 16 are appointed by the President; and the Legislative Chamber (the lower house) having 120 seats with its members elected by popular vote to serve five-year terms. The President and the executive branch completely dominate the legislature and can dissolve it if they wish so. The Parliament meets only a few days every year and has little power to shape laws. The people of Uzbekistan have very limited political rights.

Main political parties

The government severely suppresses all political opposition. The five political parties represented in the Parliament, all supporters of President Islam Karimov, are:
- LDPU (Uzbekistan Liberal Democratic Party ) – advocates liberal and democratic economic values (41 seats)
- NDP (Uzbekistan People's Democratic Party) - former Communist Party, still broadly advocates communist ideology (33 seats)
- Fidokorlar (Self-Sacrifice National Democratic Party) - advocates building an open society based on market-economy while at the same time supporting national interests; targets youth as its support base (18 seats)
- Uzbekistan National Revival Democratic Party - advocates mainly revival of Uzbek culture, promoting solidarity with the rest of Central Asia (11 seats)
- Adolat (Justice) - (7 seats)

Current political leaders

President: Islam KARIMOV (since 1991, re-elected in 2000 and 2007)
Prime Minister: Shavkat MIRZIYAYEV (since December 2003) – non-partisan
Diloram TACHMOUHAMEDOVA: President of the Lower house of the Parliament, leads the Adolat (Justice) party

Aslidin ROUSTAM: Vice-President of the Lower house of the Parliament, leads the People's Democratic party
Akmal SAIDOV: President of the National Center for Human Rights.

Abdourahim POLAT: Birlik party, not officially recognized
Mohammed SOLIH; Erk party, not officially recognized
Sanyar OUMAROV: leader of the opposition party "My Radiant Uzbekistan"

Next election dates