Objectives in investment, export and industry identified

Objectives in investment, export and industry identified

On January 18, President Shavkat Mirziyoyev chaired a meeting on priority objectives in investment, export, and industry for 2024.

The Uzbekistan 2030 Strategy sets a goal of bringing the country’s gross domestic product to $160 billion and per capita income to $4 thousand. This cannot be achieved only through the domestic market. The main thing is to attract foreign investment and increase exports actively.

The state of affairs and the activities of responsible persons in these areas were reviewed at the meeting.

Over the past six years, Uzbekistan has received almost $50 billion of foreign investment. Last year, GDP and industry grew by 6 percent.

However, exports of goods did not increase. The work to achieve agreements with foreign countries on the mutual recognition of certificates was not organized at the proper level. The disbursement of funds for five projects worth $480 million with the participation of international financial organizations has not begun. About a thousand projects worth 8 trillion UZS in the regions, the financing issues of which have been entirely resolved, have not yet been launched.

Due to shortcomings in activities and negligence, Deputy Minister of Investment, Trade and Industry B. Abidov, Director of the Agency for Technical Regulation D. Sattarov, and Director of the Agency for Attracting Foreign Investments M. Mirzayev were dismissed from office. A decision was made to bring several other managers to disciplinary liability.

In general, it was decided to introduce performance indicators (KPI) into the activities of all deputy ministers and hokims included in the investment complex.

At the meeting, the Head of state, based on specific examples, analyzed the shortcomings in the sphere.

For example, in 2 driver industries and 4 regions last year, export volumes decreased compared to 2022. Fifty percent of exports still go to the 4 primary markets. Or a third of goods are sold abroad as raw materials.

Uzbekistan has joined the GSP+ system and has the opportunity to import 6,200 types of goods duty-free into Europe, but last year, only 384 types of goods were exported under this system. Phytosanitary permits from foreign countries were obtained to export fruits and vegetables, but this opportunity was not fully used.

To take Uzbekistan’s economy to a new level, it is necessary to increase exports by at least 30 percent annually.

The President identified essential tasks in this direction and announced structural changes.

In particular, the plant quarantine system, methods, and approaches to its work will completely change. The Agency of Plant Protection and Quarantine will also be responsible for finding new potential markets and organizing the cultivation of export products. It will train manufacturers and exporters on foreign market requirements and help implement them.

All certificates and permits required to export fruits, vegetables, and food products have been digitized in recent years. However, exporters still have to go through the control of four departments at the border. In this regard, it was decided to transfer all export control functions to the Customs Committee.

Many domestic enterprises cannot join global flows due to the lack of international certification. The implementation of international standards in driving sectors of the economy does not reach 35 percent.

In this regard, the Technical Regulation Agency will be reformed and transferred to the government. Responsible persons were instructed to introduce international quality systems at enterprises, increase the range of guaranteed quality products, and reach agreements with foreign partners on bilateral recognition of national certificates.

Resources of $200 million have been allocated for export lending. In addition, 800 billion UZS are allocated to support exporters this year. However, these funds do not always become a source of value-added products and exports.

In this regard, the export support system will also change. The Export Promotion Agency will be reorganized into a trade promotion company in accordance with the requirements of the World Trade Organization. Subsidies, loans, and assistance provided by this company will be provided based on the new rating, primarily to exporters entering new markets with high-value-added products.

Instructions were given to organize reliable logistics chains to supply local products to foreign markets and to expand the processing of goods in the customs territory.

The effectiveness of investments and plans for the future were reviewed at the meeting.

Over the past six years, the volume of investments attracted to the industry of Uzbekistan has increased 7 times. Over the past three years, equipment worth $14 billion has been imported.

However, industrial productivity, job creation, and value-added have not increased accordingly. Enterprises and equipment launched in several regions and industries did not affect exports. Responsible persons were criticized for insufficient control over the effectiveness of projects, and they were given appropriate instructions.

Last year, the volume of investment in fish farming, poultry farming, jewelry, beekeeping, and silkworm farming in Samarkand and Tashkent cities and 12 districts and cities decreased. In some regions, implementing investment projects agreed upon during foreign visits and international exhibitions is proceeding slowly.

The Ministry of Investment, Industry and Trade has been tasked with taking control and accelerating the implementation of these projects.

Another issue discussed at the meeting was the growth of industrial production.

For this purpose, 24 special economic zones have been created in the country. Land in them is allocated in a simplified manner, and tax benefits are established for them. However, these opportunities are not fully used. For example, 800 hectares of land with ready-made infrastructure are empty in the zones.

In this regard, it was decided to implement a new experiment on developing economic zones. In particular, 240 hectares of land in special industrial zones in Bukhara, Navoi, and Tashkent regions will be outsourced to foreign companies.

It was noted that this year, 309 major projects can be implemented in special economic zones, and 40 thousand jobs can be created.

The Head of state paid particular attention to the localization issue.

The Cabinet of Ministers has been instructed to adopt a program to develop the region’s food industry. In particular, the tasks have been set to establish the production of 25 types of food products in great demand in the country and to introduce international standards for food enterprises.

Such opportunities also exist in the leather industry. For example, there is a strong demand for car covers, sporting goods, shoes, and handbags. Based on this, industry leaders have been instructed to form industry projects in the regions.

Not only goods, but also services must be localized. In particular, over the past five years, enormous energy, oil and gas, and metallurgy facilities have been put into operation. The demand for qualified services for operating and repairing high-tech equipment in such complexes is growing every year.

Taking this into account, the Cabinet of Ministers has been tasked with expanding the participation of local enterprises in providing services to large enterprises.

“We will achieve our goals only if every leader works selflessly, loves his country and people, and, together with his entire system, conscientiously fulfills the assigned tasks”, the President said.

Following the meeting, the heads of the investment complex, ministers, and hokims presented information on their plans for the current year.