TASHKENT (TCA) — Asian Development Bank (ADB) Vice-President Mr. Shixin Chen on November 15 delivered the keynote address at an international conference in Tashkent on the role of capital markets in accelerating Uzbekistan’s economic development. He highlighted how properly functioning capital markets can bolster private sector financing, help to deliver new infrastructure, and act as a buffer against economic shocks, ADB reported.
“Today’s International Capital Market Conference presents an important opportunity to discuss priorities for the establishment of a modern financial system, so that private sector financing can be mobilized for the country’s development needs,” said Mr. Chen. “ADB is committed to supporting the Government of Uzbekistan in tackling structural deficiency in order to realize the capital market’s potential.”
In his address, Mr. Chen underlined three key aspects for developing Uzbekistan’s capital market. First, the capital market can be an instrument of the government’s market liberalization reforms and help to raise private sector financing in the context of ongoing and ambitious privatization plans. Secondly, the capital market provides the most viable financing solutions for long-term infrastructure development and can thereby spur sustainable long-term growth. Thirdly, diversification away from a predominantly bank-based system of financial intermediation helps to manage financial risks and limit the systemic impacts of economic shocks.
ADB is preparing a new program for financial markets development in Uzbekistan to deepen the capital markets and establish a strong legal and regulatory framework. Joint technical assistance from ADB and the European Bank for Reconstruction and Development is advising the development of a sequenced capital market development strategy to be implemented with the support of key donors and international financial institutions.
Mr. Chen said that ADB has a solid track record in helping its developing member countries reform their capital markets, leading to more diversified financial sector assets, increased market capitalization and quality of listings, as well as greater market stability and investor confidence.
Since Uzbekistan joined ADB, the bank has committed 75 loans totaling $8.1 billion, including two private sector loans totaling $225 million. ADB also provided $6 million in equity investment, $218 million in guarantees, and $97.7 million in technical assistance grants. To date in 2019, ADB has committed five loans totaling $637.3 million to develop horticulture value chain infrastructure and livestock value chains; improve the efficiency of railway transport; increase access to drinking water supply; and enhance the delivery of urban infrastructure projects.
