Uzbekistan Business & Economy - The Times Of Central Asia

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Uzbekistan Plans to Attract Investment, Green Energy Development

On January 2nd, President Shavkat Mirziyoyev held a government meeting on attracting investments and developing green energy in 2024, at which it was stated that last year Uzbekistan attracted more than $22 billion in foreign investment, a 1.8-fold increase on the previous year. Mirziyoyev emphasized the importance of increasing the volume of foreign investment this year, with upmost attention to be paid to electrical and mechanical engineering, construction materials, pharmaceuticals, and the textile and leather industries. The meeting also discussed the development of green energy, with officials reporting that work is ongoing on 28 projects based on public-private partnerships for the construction of solar, wind, and hybrid power plants with a total capacity of 6.3 gigawatts. Of these, the first, with generating capacities of 2.6 gigawatts, were launched in 2023. Currently, work is underway on the construction of green power plants and energy storage systems together with companies from Saudi Arabia, the UAE, China, France, and Switzerland. In 2024, Uzbekistan plans to increase the total capacity of solar power plants to 2.6 gigawatts, wind farms to 900 megawatts, and launch energy storage devices with a capacity of 400 megawatts. At the meeting, instructions were relayed to study the possibility of introducing, based on international experience, agrovoltaics - the practice of agricultural producers installing solar panels on their fields to produce energy for their own needs or for sale, and for specific proposals to be drawn up for this area.

$10 Million Jewelry Factory to be Launched in Fergana

A jewelry factory will be created in the Fergana region together with Turkish businessmen. The project was discussed at a meeting of the regional khokim (administrative leader), Khairullo Bozorov, local businessman, Ulugbek Abdurakhimov, and Turkish partners, Ali Uyanik and Jezmi Shen, the press service of the regional khokimiyat reports. As of now, it is known that the plant will produce gold and silver jewelry. It is planned that a research department and a professional training center will operate at the plant. Its products will be targeted both at the domestic market and for export to Europe and America. The plant is set to create more than three hundred jobs.

Gazprom to Ensure Reliable Natural Gas Supplies to Central Asia

Russian energy company Gazprom has agreed with partners in Kazakhstan, Kyrgyzstan, and Uzbekistan on fifteen-year contracts for natural gas supplies. The contracts are to be concluded in mid-2024 at the St. Petersburg International Economic Forum, Gazprom’s CEO, Alexey Miller said at the company’s meeting late in December. Gazprom’s press service quoted Miller as saying that “reliable, stable deliveries under these contracts” to the Central Asian countries will begin on November 1st, 2025. Miller also pointed out an increase in the current natural gas supplies to Uzbekistan. As winter frosts came at the beginning of December, Gazprom supplied twice as much gas to Uzbekistan as the company’s daily contractual obligations, Miller stated. The Gazprom CEO also said that in just over three months in 2023, the idle gas transportation system, “Central Asia – Center,” was switched to work in reverse mode. Thanks to such joint work with our colleagues from Kazakhstan and Uzbekistan, Miller said, we implemented this project in the shortest possible time, and this winter, these countries in Central Asia are more reliably provided with gas supplies. In recent years, Uzbekistan’s natural gas industry has experienced problems due to the depletion of reserves at existing gas fields. This prompted Uzbekistan to start importing natural gas from Russia through Kazakhstan in 2023. The Uzbek Statistics Agency said last month that natural gas production had fallen by more than 4.5 billion cubic meters from January-November 2023 as compared to the same period in the previous year. From January-November, 42.7 billion cubic meters of gas was produced, compared to 47.3 billion cubic meters in 2022.

Uzbekistan and Turkey Aim to Increase Bilateral Trade to $5 Billion

Over the past five years, trade turnover between Uzbekistan and Turkey has grown 1.5-fold, and the leaders of the two countries have set the task of increasing bilateral trade up to $5 billion. This was stated during an Uzbek–Turkish business forum held in Ankara earlier this week, the Uzbek Ministry of Economy and Finance reported. The event gathered together around 300 representatives of the business community from both countries and was attended by Vice President of Turkey, Cevdet Yilmaz, President of the Association of Chambers and Commodity Exchanges of Turkey, Rifat Hisarciklioglu, President of the Council for Foreign Economic Relations, Nail Olpak, and Deputy Prime Minister–Minister of Economy and Finance of Uzbekistan, Jamshid Kuchkarov. Speaking at the forum, Turkish Vice President Yilmaz said that Turkish-Uzbek trade reached $3.5 billion in 2022, and Turkish investments in Uzbekistan amounted to $1.5 billion, Turkish media reported. At the forum, the Uzbek side, represented by the Ministry of Mining and Geology, the Agency for State Asset Management, the Ministry of Health, and the Chamber of Commerce and Industry, held presentations about opportunities created in Uzbekistan for foreign entrepreneurs, the Uzbek ministry said. The forum participants agreed that among the promising areas for cooperation between the two countries were pharmaceuticals, the leather and shoe industry, the jewelry industry, and the production of building materials, furniture and glass products. Today, approximately 1,800 enterprises with the participation of Turkish capital are operating in Uzbekistan. On the same day, the 7th meeting of the Uzbekistan-Turkey Intergovernmental Commission was held in Ankara, co-chaired by Uzbekistan's Deputy Prime Minister–Minister of Economy and Finance, Jamshid Kuchkarov, and Turkey's Vice President, Cevdet Yilmaz.

Uzbekistan to Cover Growing Demand with Green Energy Sources

Uzbekistan has set a goal of doubling its industrial production by 2030 and plans to implement more than 500 major industrial and infrastructure projects worth $150 billion. To accomplish these ambitious goals, the country needs to have guaranteed and stable energy resources, President Shavkat Mirziyoyev said on December 27th, at the launch ceremony of major projects in the field of green energy. “We estimate that in the next six years, our country's electricity demand will increase from the current 83 billion to 120 billion kilowatt hours. We will cover this primarily through renewable energy sources,” Mirziyoyev said. Uzbekistan will continue its active investment policy to increase the capacity of green energy sources to 27 gigawatts by 2030, he said, adding that the country possesses enormous potential for green energy. “In order to encourage the industry, we have launched the ‘Solar House’ system to provide preferential loans and subsidies for the installation of solar panels and ensure the guaranteed purchase of generated electricity. This year alone, 50,000 households and entrepreneurs have installed solar panels in our country,” Mirziyoyev said. Currently, Uzbekistan is implementing projects for the construction of 22 solar and wind power stations with a total capacity of 9 gigawatts, and the government will create all the necessary conditions and preferences for foreign investors to implement such priority projects, Mirziyoyev concluded.

Gazprom Eyes Central Asia Amid European Sanctions

Facing a shortfall in European gas exports due to Western sanctions, Gazprom anticipates it will sell 34 billion cubic meters of unexported gas to Central Asia, according to recent reports. "In light of the ongoing changes in the global energy market, Gazprom remains committed to ensuring a reliable gas supply to Russian consumers and bolstering export capabilities. A key focus for the company in this regard has been fostering collaboration with Kazakhstan, Uzbekistan, and Kyrgyzstan," Gazprom stated in a press release. The company confirmed a drop in gas exports to Europe of 34 billion cubic meters in the first eleven months of 2023, marking levels not seen since 1996. An earlier announcement by the Ministry of Energy of Uzbekistan unveiled a 15-year gas purchase agreement with Gazprom, extending the deal to include Kazakhstan, which involves a new pipeline construction. In October, reports indicated the commencement of Russian gas deliveries to Uzbekistan through Kazakhstan. However, the specifics of this arrangement have not been disclosed to date. Alexey Miller, Gazprom's chief, outlined plans to expand the Central Asia gas pipeline system in November, highlighting memoranda signed with Uzbekistan, Kazakhstan, and Kyrgyzstan, and expressing optimism that the project will rejuvenate this pipeline network. During the Soviet era, gas from the region was transported to Russia via the Central Asia–Center gas pipeline. After the USSR's dissolution, the pipeline ceased operations and deteriorated, requiring substantial refurbishment to enable gas supplies from Russia to Central Asia. Miller noted the completion of the initial repair stage of the Central Asia-Center gas pipeline, facilitating gas delivery to Uzbekistan via Kazakhstan. Earlier this year, Tashkent inked a two-year gas supply contract with Gazprom amounting to approximately 2.8 billion cubic meters annually. Despite these developments, details regarding the pricing of the purchased gas remain undisclosed. Which according to Uzbekistan's Energy Minister, Zhurabek Mirzamakhmudov, is “in alignment with national interests and market dynamics.”