Uzbekistan: Economy

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Overview:
Uzbekistan is a dry, landlocked country of which 11% consists of intensely cultivated, irrigated river valleys. More than 60% of its population lives in densely populated rural communities. Uzbekistan is now the world’s second largest cotton exporter, a large producer of gold and oil, and a regionally significant producer of chemicals and machinery. The IMF suspended Uzbekistan’s $185 million standby arrangement in late 1996 because of government steps to the negative external conditions generated by the Asian and Russian financial export and currency controls within its already largely closed economy. Economic policies that have repelled foreign investment are a major factor in the economy’s stagnation. A growing debt burden, persistent inflation, and a poor business climate led to disappointing growth in 2001. However, in December 2001 the government voiced a renewed interest in economic reform, seeking advice from the IMF and other financial institutions (World 7). After independence, Uzbekistan tried to support inefficient state enterprises and shield consumers from the shocks of rapid economic reform. These policies eventually led to severe inflation and an economic crisis. Reforms brought inflation down to manageable levels and small businesses began to grow. Larger institutions are seeking joint ventures with international corporations. However, currency and trade restrictions remain too tight to encourage significant foreign investment. Falling global gold, copper, and cotton prices also hurt the economy. A privatization program is slowly being implemented with international support. Privatization is necessary to raise hard currency and promote economic development (Republic 4).

GDP: purchasing power parity—$62 billion (2001 est.)
GDP—per capita: purchasing power parity—$2,500 (2001est.)
GDP—composition by sector: agriculture: 33% industry: 24% services: 43% (2001 est.)
Inflation rate (consumer prices): 23% (2001 est.)
Labor force: 11.9 million (1998 est.)
Labor force—by occupation: agriculture 44%, industry 20%, services 36% (1995)
Unemployment rate: 10% plus another 20% underemployed (1999 est.)
Budget:
revenues: $4billion expenditures: $4.1 billion, including capital expenditures of $1.1 billion (1999 est.)
Industries: textiles, food processing, machine building, metallurgy, natural gas, and chemicals
Industrial production growth rate: 3.5% (2000)
Electricity—production: 40.075 billion kWh (2000)
Electricity—production by source: fossil fuel: 86.95% hydro: 13.05% nuclear: 0% other: 0% (2000)
Electricity—consumption: 4189 billion kWh (2000)
Electricity—exports: 4.1 billion kWh (2000)
Electricity—imports: 5 billion kWh (2000)
Agriculture—products: cotton, vegetables, fruits, grain; livestock
Exports: $2.8 billion (2001 est.)
Exports—commodities: cotton 41.5%, gold 9.6%, energy products 9.6%, mineral fertilizers, ferrous metals, textiles, food products, and automobiles (1998 est.)
Exports—partners: Russia16.7%, Switzerland 8.3%, UK 7.2%Ukraine, Eastern Europe, Western Europe
Imports: $4.1 billion (1998)

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