Uzbekistan - Market overview
Trade and investment between Uzbekistan and Canada: 2014-2018
Bilateral merchandise trade in 2018: Canadian exports to Uzbekistan $6.3 million, Canadian imports from Uzbekistan $0.7 million (Source: Statistics Canada)
Why Uzbekistan matters
- With an estimated population of nearly 33 million (2018), Uzbekistan has the largest potential consumer market in Central Asia. Uzbekistan is also a young country with more than two-thirds of the population being of working-age (15-64), contributing to a strong labour force.
(Source: World Bank)
- Uzbekistan has maintained a high GDP growth, averaging 7.0 percent over the last 10 years. Growth forecasts for 2019 and 2020 are 5.5% and 6.0% respectively.
(Source: IMF World Economic Outlook, October 2019)
- Since 2016, the Uzbekistan’s government has been undertaking large-scale reforms of its economic and political systems. The most important changes include: currency exchange liberalization, simplified business registration procedures, tax incentives, improved private property protection and privatization.
- Uzbekistan ranks 69th in the Ease of Doing Business ranking for 2020, an improvement of 18 places from 2016.
(Source: World Bank)
- Strategically located, Uzbekistan is the only country that borders each of the four other Central Asian nations, plus Afghanistan, enhancing its attractiveness for investment. Regionally, it is a major economic engine and influencer of peace and stability.
- Uzbekistan has rich natural resources such as gold (12th in the world for production in 2018), natural gas (13th for production in 2018), and cotton. These offer attractive opportunities for investors. Uzbekistan is also the world’s 7th-ranking uranium supplier (2019), and is expanding production. (Source: World Nuclear Association, World Gold Council and Enerdata Yearbook)
- Doing business in Uzbekistan is not without its challenges. The continued presence of state-owned enterprises in the economy and low corruption perception index ratings (158/180 in 2018) are contributing factors.
(Source: Transparency International)
Sectoral opportunities in Uzbekistan
Uzbekistan’s agricultural sector is undergoing reforms aimed at progressively diversifying away from labour- and water-intensive cotton into higher value-added production and processing, including fruits and vegetables and livestock. Over the past few years, the Government of Uzbekistan has supported poultry and animal farming and encouraged increased mechanization as well as the adoption of new technologies in order to increase farmers’ productivity. This has created opportunities for agricultural machinery and equipment, irrigation technologies, greenhouses and related technologies, animal genetics (poultry as well as dairy and beef cattle), cold storage facilities, and processing equipment.
As Uzbekistan is progressively growing richer, thanks to its business- and investors-friendly reforms, the taste of its consumers is evolving in tandem with their increased means. Coupled with the recent relaxation of Uzbekistan’s visas regime, which helps increase the number of tourists and business visitors, consumption of fish and seafood, meat and other higher income agrifood products are rising, thus creating opportunities for Canadian exporters.
Canada is a partner of choice in the education sector in Uzbekistan, the most populous country of Central Asia that counts over 700,000 high school and college graduates every year. Canadian institutions have the solutions and expertise, at both the vocational and higher levels, to contribute to the education and the professional skills development of the population. In recent years, the signing of several MoUs with some of Canada’s well-renowned universities, combined with the introduction of a new fully funded Study in Canada scholarship program by Global Affairs Canada in 2019, reinforces Canada’s position in the recruitment of foreign students from Uzbekistan.
Information and communication technology
In the context of its broad economic and social reforms, the Uzbek government is looking to find solutions for providing e-government services in all spheres of society and the economy, including regional development, agriculture, health, education and banking by using innovative technology. The government is also supporting the commercialization of technology and business growth, through the creation of innovation centers such as the Mirzo Ulugbek Innovation Center.
While currently dominated by state-owned enterprises, the sector is expected to go through significant restructuring in the coming years, with the two main mining conglomerates (Almalyk Mining and Metallurgy Complex and Navoi Mining and Metallurgy Complex) expected to be partially privatized. The State Committee on Geology and Mineral Resources (Goscomgeology) recently assumed responsibility for all geological surveying and mapping, creating opportunities for Canadian companies with technology and expertise in this area. Investment opportunities in the gold mining sector abound, particularly in the Navoi region.
Oil and Gas
Uzbekistan is the second largest natural gas producer in Central Asia, and is believed to have significant hydrocarbon reserves. Moreover, the Uzbek government has been undertaking reforms in this sector with a view to developing its energy resources and modernizing production. As a result, there could be increasing opportunities for Canadian technology and equipment providers in Uzbekistan as they take steps towards modernization. The anticipated restructuring and privatization of Uzbekneftegaz, the national holding company, may also provide additional opportunities for Canadian companies.
- Uzbek Chamber of Commerce and Industry (CCI)
- Upcoming trade fairs in Uzbekistan
- Uzbekistan country economic update - World Bank
- Import of goods by legal entities - Uzbek State Customs Committee
- Major reforms in Uzbekistan since 2017 - Schneider Group
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