June 19, 2014
The Nation’s Development Indicator2
Prospects of attracting foreign investments to the textile industry of Uzbekistan. 3
Press-service of MFA of the Republic of Uzbekistan
POLICY
Meeting at the Oqsaroy
President of the Republic of Uzbekistan Islam Karimov at the Oqsaroy on June 13 received Celeste Wallander, Special Assistant to the President of the United States of America and Senior Director for Russia and Eurasia on the US National Security Council.
The parties to the conversation discussed in detail the current issues in the bilateral cooperation across a variety of spheres as well as certain matters in regional and international affairs.
The Protocol on Security Guarantees signed recently by the United States and other countries of the “nuclear five” to what was initiated by Uzbekistan on 28 September 1993 from the rostrum of the United Nations General Assembly and came to be known as the Treaty on the Nuclear Weapons Free Zone in Central Asia (CANWFZ) is a genuine contribution to implementing the Treaty on the Non-Proliferation of Nuclear Weapons. Completion of the ratification process of the Protocol to the CANWFZ Treaty will become an important element in the global disarmament and nonproliferation course as much as in the formation of mechanisms in boosting the regional and international security.
The conversation also served for an exchange of views on other issues of shared interest, including the developments in Afghanistan and their repercussions on regional processes.
(Source: Press Service of the President of the Republic of Uzbekistan)
ECONOMY
The Nation’s Development Indicator
On June 11, the sixth industrial fair opened in Tashkent. This time, the exposition features products manufactured in the country’s fuel and energy sector, as well as chemical, petrochemical, mining and metallurgical industries.
Being held in Uzexpocentre pavilions, this fair is usually one of the most notable of the series of ones of the first stage of the International Industrial Fair and Cooperation Exchange in terms of the number of visitors and participating companies presenting their products. Last year, for instance, 127 manufacturers took part in the fair. They showed 1,880 goods, 80 of which were new – they had been launched under the production localization program. Around 4,600 people visited the event then, with a large number of them being representatives of foreign companies.
The fair is also remarkable for the sums of the industrial cooperation and export agreements concluded at it. In 2013, the total value of the deals exceeded 57.3 billion soums and $4.7 million, respectively. The event is like the final chord of the first stage of the International Industrial Fair and Cooperation Exchange. Following it, experts sum up the interim results of the whole series of the fairs, analyze them, and prepare for the second stage of it – the largest fair of the International Industrial Fair and Cooperation Exchange.
“Year by year, local and foreign manufacturers are getting more and more interested in developing industrial cooperation and expanding their circle of business associates in the areas of trade, building new manufacturing facilities and launching new products,” said Anvar Sharipov, deputy chief of technical policy department of the headquarters of Uzbekneftegaz, the national holding company. “Our company is one of the leaders in these areas. The values of the agreements we conclude at the fair increase every year, which allows our sector to gradually cut the export of materials and components, and so to save foreign currency and create new jobs.”
Besides, the fair is a kind of the country’s development indicator, for the innovative projects, new products, as well as modernization, investment and many other initiatives offered at the fair by the local industrial giants – Uzbekenergo, Uzbekneftegaz, Olmaliq and Navoi mining and metallurgical plants, Uzkimyosanoat, and Uzmetkombinat – are connected with the general state of the economy, its investment and business climate. Thanks to the technological modernization and energy-efficiency solutions found to bolster Uzbekistan’s industrial sectors, the republic’s GDP constantly grows – despite the negative factors of the global markets.
“Our company presents its traditional products, which are demanded in various industries of the country. They are rolled ferrous metal products, grinding balls, copper and copper-containing alloy products, welding rods, steel enameled domestic containers, nails and many other items,” said Nariman Umerov, head of investment department of Uzmetkombinat. “The production of these products was launched – or to be launched in the medium term – under the production localization program. For the first three month of this year, our company manufactured 2.17 billion soums’ worth of localized products, which was 18.4% higher than we had planned. We have begun the production of two types of copper foil, for instance. The company has also spent 3.38 billion soums on re-equipment.” (Currency rates of CB from 16.06.2014 1$=2304.44 soums).
Many experts point out that Uzbekistan’s economy does not use many of its resources yet. The key to exploring them is further development of the domestic industrial cooperation and consequent substitution of the imports with localized production, which will stimulate the manufacturers to introduce energy-efficient technologies, develop alternative energy sources and use advanced quality management systems. That is what the fairs held in Uzbekistan are aimed at.
(Source: “Uzbekistan Today” newspaper)
INVESTMENTS
Prospects of attracting foreign investments to the textile industry of Uzbekistan
In today’s world, the textile industry is considered to be one of the biggest export-oriented sectors. Textile enterprises all over the globe export the widest selection of goods – from yarn to a great variety of finished produce.
The Republic of Uzbekistan these days is busy implementing dramatic structural reforms in the textile industry, with the fact testifying to an ever growing image and competitiveness of the national textile output in the world market. For the time being, more than 2,500 textile enterprises successfully operate in the Republic.
At present, massive investments are enticed to Uzbekistan from abroad for the development of the textile sector. It should be observed that for overseas investors, the attractiveness of a given industry can be explained by several factors: the abundance of raw materials, cheap and qualified labour force and, above all, the strong state support and favourable liberal business conditions created in the country. These include a stable legal framework for economic activity, elimination of any excessive outward interference, streamlining of check-ups by controlling authorities, reduction of forms, in which accounting reports are to be presented, simplification of licensing, registration and certification procedures and, what is even more important, a wide system of privileges, preferences and guarantees granted to joint ventures and foreign enterprises, which are enshrined in the national legislation.
Today, more than 400 joint ventures operate in the light industry of Uzbekistan. Over US $2 billion worth of foreign investments have been attracted to the sector. Among the investors are many leading overseas manufacturers of textile produce and equipment, such as Indorama Industries PTE. Ltd. (Singapore), DAEWOO International, Daishin Textile, Shindong Enerkom (South Korea), Rieter AG, Swiss Capital (Switzerland), Bayteks Tigaret, Tekfen, Bo Group, Mert Iplik (Turkey), Vayreks, Osborne Trading, Tagus (Great Britain) and many others. The State Program of Regional Development for the period 2013-2016 provides for the implementation of 1,629 investment projects in the national light industry. Valued at US $1286.3 million, they are expected to create 63,194 new jobs, according to data from the State Joint-Stock Company Uzbekengilsanoat.
It is also necessary to emphasize that between 2011 and 2013 a number of important projects have been realized in the Republic’s light industry with the help of foreign investments. In 2011, in particular, a joint venture enterprise, called Indorama Kokand Textile, has been set up with the participation of Indorama Industries PTE. Ltd. (Singapore). As of 1st January 2014, the total volume of funds this company has already invested in the Uzbek textile sector exceeds US $90 million.
Another serious project realized in the textile industry of Uzbekistan is the creation of a joint venture specializing in the production of textile equipment. It was accomplished together with Indorama Industries PTE. Ltd., a Swiss machinery-building company. With the project’s first stage having been finalized, the enterprise is now capable of turning out carding and belt equipment. During its second stage the production of ring-spinning machinery will be mastered. Putting into operation metal-working and dyeing facilities for textiles is planned in the course of the project’s third stage.
Production volumes tend to swell in the textile industry of Uzbekistan from year to year. In 2013, as one example, indigenous textile enterprises have made 6.7 trillion Soum worth of output, an 11.2 per cent increase on the year before. An even higher rate of growth – 23.8 per cent – has been reached by garment enterprises (718.1 billion Soum), according to data from the State Statistics Committee of the Republic of Uzbekistan.
The main foreign markets for Uzbek textile exports include the CIS member states, and the Russian Federation in the first place, Turkey, the European Union, Korea, the US, Canada, Venezuela, Morocco and others.
By and large, the light industry of Uzbekistan now boasts a reputation of a reliable business partner in the international arena. It is increasingly becoming one of the key centers of the world economy, where a wide selection of high quality goods is manufactured.
(Source: “Business partner” newspaper)