Summary: 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.
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.
Transition has started. While the timing and sequence are uncertain, it appears obvious that the process of political transition has started. The question is when, and how, the elites and security forces will act. Moscow can be expected to exert a great deal of influence, a fact not lost on the protestors who have avoided blaming Moscow.
Growth declined in 2019. Despite the surge in coal exports to China last year, GDP growth dropped to 5.1% for the year, from 6.9% in 2018 and 8.6% in 1Q19. Delays with the Oyu Tolgoi expansion and problems in other sectors, such as agriculture, balanced out the coal growth.
On the international banking black list. On February 21st the FATF lifted the suspension on Iran and restored full restrictions, effectively blocking international banks from dealing with Tehran. That action led to a kneejerk 14% decline in the “street” value of the rial versus the US dollar. That risks spiking inflation again while deepening and extending the recession.
Cautious opening to investors. Turkmenistan is now actively engaging with international investors, including the holding of showcase events, as it tries to attract more foreign investment. It is also trying to expand trade partnerships and has indicated a desire to join the WTO. President Berdymukhamedov has declared the slogan for 2020 as “Turkmenistan – The Home of Neutrality”.
Peace deal talks inch forward. Amidst a mixture of threats and concessions, the peace talks between the US and the Taliban continue in Doha. This is the most serious effort for a deal since the conflict started 18 years ago.
Economic growth strengthened in 2019. GDP expanded by 4.5% in 2019, up from 4.1% in 2018. The decline in the oil sector contribution, due to several maintenance disruptions, was more than offset by the better performance in retail, construction and transport sectors.
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.
Iran is out of bounds for most strategic investors. Despite the confident rhetoric from the country’s political leaders, Iran’s economy is under severe strain because of sanctions. This backdrop has made the country un-investable for most strategic investors.