Priority tasks to ensure macroeconomic stability and economic growth discussed

Priority tasks to ensure macroeconomic stability and economic growth discussed

On January 16, President Shavkat Mirziyoyev chaired a meeting on ensuring macroeconomic stability and economic development in 2024.

In 2023, economic growth in Uzbekistan was 6 percent. In particular, an increase of 6 percent was recorded in industry, 6.8 percent in the service sector, 6.4 percent in construction, and 4.1 percent in agriculture.

This year, it is planned to increase the gross domestic product by at least 6 percent and bring it to $100 billion. The tasks and necessary measures in this direction were discussed at the meeting.

The Head of state emphasized that this requires workers in the economic complex, who are at the forefront of reforms, to work even harder.

For example, with increased industrial production, the added value of products does not exceed 40 percent. This is mainly due to dependence on imports, high energy consumption, and excessive costs.

In this regard, it has been determined that 2024 will become the year of efficiency and cost reduction for managers of the economic complex and all state enterprises. Using the example of several industries, the possibilities of reducing costs by optimizing procurement and logistics, saving energy resources, and digitalizing were analyzed.

This year, the complex will increase added value by 45 percent, reduce production costs by 15 percent in large industries, and ensure industrial growth by 7 percent overall.

It was proposed to link the activities of the heads of the economic block with monthly, quarterly, and annual performance indicators (KPIs) and to review the number of deputies.

The issue of financial discipline was particularly touched upon at the meeting.

Last year, individual state-owned enterprises failed to ensure the payment of 8 trillion UZS in dividends and taxes to the budget. In Syrdarya and Jizzakh regions, tax revenues increased by 20 percent, while in Khorezm, Bukhara and Kashkadarya regions this figure did not even reach 7 percent.

Such cases indicate shortcomings in the work of heads and deputies of territorial tax departments and tax officials in the mahalla. Therefore, the need to revise the tax system was noted, and new directions were identified.

The first direction is that the functions of working with 40 thousand budgetary organizations will be transferred from the districts of the newly created Interdistrict Inspectorate of Budgetary Organizations under the Tax Committee. The inspection will be digitalized and integrated into the treasury’s electronic system.

The second direction is that the committee will create an interdistrict inspectorate to collect tax debts. It will be given the same powers as the Bureau of Enforcement. Thanks to this, transferring another 200 tax officers in the districts to the mahalla will be possible.

The third direction is that a separate system will be created to work with 80 of the largest enterprises and 35 commercial banks, providing 50 percent of the country’s tax revenues. For this purpose, a new structure is being created within the Inspectorate for Large Taxpayers, which will interact with the Ministry of Economy and Finance.

The Ministry of Economy and Finance was entrusted with ensuring the timeliness of tax revenues and preventing unjustified increases in enterprise costs.

Regarding the customs sector, it was noted that last year, benefits worth almost 60 trillion UZS were applied to import goods from abroad. Still, no analysis of their effectiveness was carried out. In this regard, instructions were given to study all goods imported under preferential treatment.

Another source of budget revenue is privatization and auction of land. However, 484 state assets included in the privatization program are not put up for auction.

For example, dozens of grain enterprises put up for auction remain unsold because their prices were set incorrectly.

The Cabinet of Ministers was tasked with eliminating shortcomings and preparing a new privatization program to provide 20 trillion UZS in revenue this year.

Last year, 1 trillion UZS came from land auctions, and 12 thousand new projects appeared. To expand this work, responsible persons were tasked with developing master plans for 70 districts by the end of the year and for all districts by the end of the following year.

The most pressing issue today is the shadow economy. The analysis shows that a large turnover volume in the service sector, construction and industry remains in the shadow.

The Head of state said that the shadow economy is an obstacle to fair competition and the activities of decent entrepreneurs and outlined additional measures.

Currently, 14 bodies are involved in the fight against the shadow economy and economic crime. The powers of the Department for Combating Economic Crimes under the Prosecutor General’s Office will be expanded to coordinate and strengthen these activities. The department will have the most modern facilities and experienced specialists, and a scientific, analytical, and training center will be opened. At the same time, a separate department for the shadow economy and its regional departments will be created in the Prosecutor General’s Office.

The issue of the effectiveness of budget expenditures was also discussed at the meeting.

Last year, illegal spending amounted to 1.2 trillion UZS, and shortages and thefts amounted to 200 billion UZS. Funds allocated for health and agricultural programs were not fully used. Cases such as calculating wages for a non-existent employee or unfulfilled work, unjustified receipt of loans, and payment of bonuses have also become more frequent.

In this regard, the activities of the State Financial Supervision Inspectorate under the Ministry of Economy and Finance were called unsatisfactory. A decision was made to transfer this structure to the Department for Combating Economic Crimes of the Prosecutor General’s Office.

The task has been set to take control of the correctness of spending 313 trillion UZS provided for in the budget for the current year.

The issue of reducing inflation is also relevant. As a result of the measures taken, inflation last year did not exceed 9 percent.

It was emphasized that food inflation could be curbed only by increasing food production, and the Minister of Agriculture and hokims were given corresponding instructions.

Measures to achieve inflation below 9 percent this year were discussed.

Issues of ensuring the stability of the banking system and lending to the economy were also considered. Based on market mechanisms, the task has been set to develop a program to reduce loan rates by at least 2-3 percent.

At the meeting, special attention was paid to the issue of employing the population. In this regard, the importance of effectively implementing the recently adopted program was emphasized.

It was noted that vocational education institutions of the employment system and the work carried out on external labor migration are not at the proper level. The Ministry of Employment and Poverty Reduction has identified additional tasks to eliminate shortcomings, provide vocational training to the population, and create jobs.

Following the meeting, leaders of the economic complex, ministers, and hokims reported on their plans for the current year.