Uzbekistan is the second largest economy in Central Asia, and the government aims to achieve upper-middle income status by 2030. Real GDP grew by 5.3% in 2022, down from 7.4% the previous year. For almost three decades, the country’s post-independence growth was driven chiefly by state-directed investment and industrialisation, with international trade and private sector development significantly limited. This has changed since the launch of a wide-ranging programme of reforms in 2017.
Uzbekistan emerged on a relatively strong footing following the COVID-19 crisis, and as of spring 2023 the impact of Russia’s war in Ukraine has been muted. The resilience of the country in face of serious recent economic shocks is testament to the prudent and agile policy response of the authorities, as well as the country’s position to benefit from higher international prices for key exports such as gold. Nevertheless, the growth outlook is uncertain, with the continuation of Russia’s war in Ukraine and the associated potential for further sanctions to affect Uzbekistan’s trade, persistently high domestic inflation and tighter global financial conditions all contributing to a challenging short-to-medium term context. Since the reform process began, the government has made considerable efforts to diminish the role of the state in the economy and enable the private sector to play a more expansive role in economic development.
Nevertheless, the resilience of Uzbekistan’s economy continues to be hampered by a relatively underdeveloped private sector. Understanding the issues that prevent the private sector from investing, hiring, innovating and growing will be key to ensuring sustainable prosperity in the years ahead. It will also be critical to the success of Uzbekistan in navigating the twin transitions of digitalisation and decarbonisation. This report brings together recent OECD analysis on key business climate issues in the country in order to focus policy attention on the most pressing questions facing the business community in the country.
The content of the report is guided by a survey of international – primarily European – firms operating in Uzbekistan. The survey was an opportunity to gauge business sentiment among a small cohort of international firms of the type that the government is actively seeking to attract to the country. The concerns, observations and positive appraisals gathered through the survey largely dovetail with the OECD’s own analysis on business climate issues in Uzbekistan.