The global financial and economic crisis continues to challenge the world’s economies. Not only developing countries but also leading ones have suffered the recession. In these toughest of conditions, economic strategy pursued in Uzbekistan has been distinct with its foresight and pragmatism. The result is the stability and sustainability allowing the economy to evolve steadily and dynamically. Today, it makes the “Uzbek model” attractive even for those who just recently have treated it with skepticism. Experts at such authoritative organizations as the International Monetary Fund, World Bank and others give affirmative appraisal of the achievements in the country amid the global downturn.

Cabinet of Ministers of Uzbekistan has summed up the outcomes of the socioeconomic development for 9 months which gave a conclusive proof of the practicality of the chosen path.

Reports presented to the government stated that for the past 9 months, GDP has grown by 8%, industrial output by 9.1%, agriculture by 3.3%, services by 15.8% and construction work by 33.5%. State budget was executed with a surplus of 0.2% to GDP, inflation did not exceed the projected parameters.

Priorities of the economic program

In his speech at a meeting of the Cabinet of Ministers on addressing the results of socioeconomic development in 2008 and priorities of economic program for 2009, President of Uzbekistan Islam Karimov, expounding on activities of Anti Crisis Program, emphasized the importance of further accelerating the modernization, technological re-equipment of enterprises, wide introduction of modern flexible technologies.

“This particularly concerns to basic industries, export oriented and localized production. The objective is to stir up the implementation of adopted sectoral programs of modernization, technological re-equipment of production, to switch to international quality standards that will ensure stable positions in external and internal markets,” underlined the President.

These objectives were and remain a priority, and 9 months’ results underscore accomplishments in this direction. Active investment policy and accelerated implementation of major projects has provided  for growth in capital investment by 28.3%, including 2.1-fold growth in foreign direct investment. In the first 9 months of the year, 156 projects on technical modernization were completed, 371 production facilities were commissioned, including 139 in food industry, 122 facilities in building materials industry, 71 objects in light and textile industry and 13 in car industry.

Within development and technical modernization programs, eight projects were completed in one of the leading sectors of the national economy, automobile industry. In particular, expansion and modernization of production facilities, output of car seats rose at UzTongHong, and electric wires at UzKodji, production of digital clocks for cars was launched at Idas Electronics. Major modernization and reconstruction work was completed at nine ginning factories of O’zpahtasanoat association.

Implementation of adopted presidential resolutions to encourage productivity of domestic manufacturers through additional tax and customs benefits, increase in concessional lending has raised the volumes of consumer goods production by 13.7%. As part of the localization program, production of more than 100 new goods was developed in the past period of 2009, production of localized products increased twofold, production and sale of import substituting goods realized $2.6 billion.

As the Cabinet of Ministers noted at the meeting, implementation of well-thought-out and coherent program of socioeconomic development and effective anti-crisis measures ensure successful neutralization of the negative impact of the global financial slowdown on the economy, its balanced development and dynamic growth.

Measures on creating modern, diversified and competitive economy through active structural reforms, modernization and technological rearmament of strategic sectors of economy accelerate the development of industrial and social infrastructure, particularly in rural areas, as well as full support for domestic producers, small businesses and private enterprises maintain sustainable and high economic growth.

During the meeting, a special attention was paid to the development of external trade and diversification of exports, including through active promotion of domestic manufacturers in traditional and new foreign markets. It was emphasized that systemic measures, financial and credit support for domestic exporting enterprises adopted within anti-crisis program provided positive trade balance of more than $2.3 billion.

However, the government meeting hosted a serious discussion on how to increase exports. Almost all sectors of the economy with export potential were reviewed. In the forefront of measures, industries’ leaders are tasked to ensure increase in competitiveness of local producers, diversification of exported goods and services, responsiveness to changes in external markets.

Boosting employment

Particular focus of the meeting fell on the creation of new jobs and increase in employment rate. Through the implementation of comprehensive targeted efforts, within first 9 months of the year, 743,500 new jobs were created, which is 36.4% more than in the same period in 2008. Of these, 311,100 jobs were created by small businesses and private enterprises, including 203,000 in services, and 77,900 in home-based work on labor agreements.

Given that the creation of new jobs is a major social challenge, particularly in the context of the global economic recession, ministers discussed the draft employment program for 2010. The discussion was also attended by senators and members of both chambers of Oliy Majlis, members of Jokargy Kenes of the Republic of Karakalpakstan, the council of people’s representatives from regions and Tashkent city.

The draft program provides for the establishment in 2010 of 950,000 new jobs, including 282,000 jobs in services, 208,000 jobs through expansion of all forms of home-based work, 61,300 jobs in industrial and social infrastructure, expansion of work on improvement of human settlements.

Following this discussion, attendees approved the draft Employment Program for 2010 and decided to forward it for approval to Oliy Majlis of the Republic of Uzbekistan.

Special attention to rural improvement

At the meeting, a special emphasis was made on the implementation of the Year of Rural Development and Improvement Program, wide range of measures on improving rural settlements, enhancing living conditions of rural population through expansion of private house construction of approved model design.

During the first 9 months of the year, 4.7 million square meters of individual housing, 577 km of gas networks and 1,680.8 km water supply networks was commissioned in rural areas.

The recent exhibition of model projects of individual housing and social facilities for villages became a memorable event. Its visitors were introduced to almost 50 projects for rural residential development meeting modern standards of architecture and design. Projects of one- and two-storey houses of traditional and improved comfort were developed for villages, taking into account climatic, engineering and geological conditions. Given the demographic characteristics of rural families, they are provided from three- to seven-room one- and two-story homes.

All types of houses are equipped with modern engineering and design solutions compliant with the maximum use of domestic construction and finishing materials. Model projects of rural houses involve the use of energy-saving materials and equipment. They include new walling materials: foam blocks, three-layer modular panels, such as “sandwich”, solar energy, energy-efficient boilers for heating and hot water supply.

As was noted, 42 residential blocks were prepared in the countryside to begin the integrated development of housing on the approved model projects in the fourth quarter through loans provided by Qishloq Qurilish Bank.

During the discussion, participants analyzed major parameters of the program of integrated development of individual housing in rural areas for 2010, as well as sources of funding.

The program provides for construction in rural areas of about 8,500 individual houses on model projects with a residential area of 955,000 square meters. On 42 selected sites, contractors will begin accelerated construction of 840 homes with an area of 95,000 square meters. The program will get 588.7 billion soums of funds, including 284.9 billion soums of concessional loans by Qishloq Qurilish Bank.

Heads of the Council of Ministers of the Republic of Karakalpakstan, regional administrations, engineering company Qishloq Qurilish Invest, Qishloq Qurilish Bank and the State Architectural Construction Department are tasked to accelerate the implementation of the program, including transfer of appropriate land areas with made-up engineering and transport communication for the construction of individual housing and social facilities of model projects. Also, measures were determined to ensure the soonest commissioning of additional production facilities for the manufacture of walling, roofing and other building materials providing 25% cheaper construction of individual houses.

Following the discussion, the government of the republic made corresponding decisions, which propose additional measures to ensure implementation of major priorities of socioeconomic development in 2009 and establishment of reliable guarantees for the sustainable development of the republic’s economy in the next year.