Stayed positive in 2020. Uzbekistan GDP is expected to have grown by 1.6% in 2020 (preliminary estimate). This is because of the impact of the Covid lockdown on domestic consumption and the fall in external demand. A bounce of 4-5% is expected in 2020.
This is the first report in a three-part review covering the consumer sectors in the five Central Asian states. Part 2 will review the Caucuses countries and part three will focus on Ukraine and Belarus. These reports will provide an overview of the trends in the major consumer sectors and identify the major and emerging themes in each country. Macro-Advisory provides more detailed strategic and due-diligence analysis covering all of the identified themes.
Change has been very fast. Uzbekistan has undergone a fast-paced change since late 2016. This “new-frontier” attracted a lot of investor interest and IFI aid/loan money.
The pace of economic and social reform continues at the pace set by President Mirziyoyev soon after his election. To some extent, the easy steps have been taken, and resultant changes are working. Now the government effort is focused on privatizations and on expanding investor interest in sectors targeted to create economic and export diversification.
New methodology. The government has adopted international standards for macro data collection and reporting. It means that the recent series (from 2017) bears little relationship to the unreliable historic trends.
Growth. GDP is expected to grow close to 5% per annum for several years. The main drivers are the increase in investment spending, including strong growth in FDI, budget spending and rising incomes.
GDP stabilizes near 5% growth. GDP is on course for growth close to 5% this year and next. The economy has been hit with a number of factors, such as the impact of the 2017 devaluation and the spike in both inflation and interest rates. Balanced against this are the competitive benefits of a weaker som, higher state spending, especially state-sector salaries and pensions, and rising investment.
Waiting for a debut Eurobond. Uzbekistan will issue a debut Eurobond very quickly, once it receives an international credit rating. The process of getting a rating is ongoing and ministers hope it will be completed by the autumn and a debt issue done by the year-end.
Important sector. Agriculture accounts for 19% of GDP and 27% of the workforce in Uzbekistan. The sector has been growing at some 6-7% (official figures) per year for the past decade or so.
Off the blocks quickly. Uzbekistan is playing catch-up with the rest of the CIS and Eurasia after 25 years of isolation. President Mirziyoyev and his team have moved surprisingly quickly with some key changes that should yield a positive knee-jerk reaction from investors. But the “to-do” list remains long and daunting.
President of Uzbekistan dies. President Islam Karimov has died. The last Communist Party General Secretary of the Uzbekistan Soviet Socialist Republic, he was President of Uzbekistan throughout the post‐Soviet period.