Uzbekistan Business & Economy - The Times Of Central Asia

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Banking

Uzbekistan Pitches Decades of Tax Breaks to Financial Firms

Uzbekistan is offering qualifying financial firms nearly half a century of tax exemptions to set up in Tashkent. The goal is to attract private capital into an economy where state-owned banks still control most banking assets. On September 10, President Shavkat Mirziyoyev appointed his daughter, Saida Mirziyoyeva, to head the planned Tashkent International Financial Centre, Reuters reported. She has led the presidential administration since 2025. Mirziyoyev announced the project at June’s Tashkent International Investment Forum, promising free capital movement alongside tax incentives. Its legal framework would draw on English common law principles, as is the case with Kazakhstan’s Astana International Financial Centre. Who Gets the Tax Breaks? Under the founding law, qualifying participants would receive income and social tax exemptions on financial services income until January 1, 2076. Eligibility requires an actual economic presence in the center and compliance with its rules. The income incentives exclude members of multinational groups with annual revenues of at least €750 million in two of the preceding four fiscal years. Those firms face a domestic top-up tax. The offer is therefore less generous for large multinational groups. A global bank would need a commercial reason to enter Uzbekistan beyond the prospect of a lower tax bill. Most of the foreign businesses operating in Uzbekistan are already concentrated in Tashkent. Almost 63% of the country’s foreign-invested enterprises were based in the capital as of June 1, 2026. Financial firms entering the city would therefore have an existing customer base to pursue, although the numbers alone reveal little about demand for particular services. The domestic banking market does offer scope for competition. In its 2026 assessment, the IMF reported that nine state-owned commercial banks accounted for 63% of banking assets. It also noted delays in privatizing two large banks and urged the authorities to withdraw directed and preferential lending. The center could attract private lenders and help more Uzbek businesses obtain loans. However, simply moving existing deals there to reduce tax bills would do little to expand access to credit. Astana’s Head Start Kazakhstan has operated its financial center since 2018. Its AIFC Court sits outside the national judicial system and uses procedures based on English common law. Businesses can also agree to bring disputes there even when those disputes originate outside the center. The court works directly with Kazakhstan’s authorities to enforce its judgments, and says its first ruling resulted in full payment through private bailiffs. That gives prospective users a concrete example of how a commercial judgment can lead to the recovery of a debt. Uzbekistan’s law likewise provides for an independent commercial court and nationwide recognition of its final judgments. It requires judgments to be published within 30 days, subject to limited confidentiality protections. For lenders, that could reduce uncertainty about committing money to an unfamiliar market. Tashkent would still need to establish a record of decisions and enforcement comparable to the experience available in Astana. The law allows 12 months to adopt essential operating rules, extendable by six months. Activation then requires...

Cryptocurrency

Uzbekistan Tests HUMO Stablecoin for Everyday Payments

Uzbekistan has begun its first experiment using a privately issued stablecoin called HUMO to pay for everyday goods and services. A stablecoin is a digital token designed to keep a fixed value, rather than rise and fall sharply like Bitcoin. One HUMO will be pegged to one Uzbek soum, with the tokens backed by government securities. The name may cause some confusion because HUMO is also the name of an Uzbek payment system. The token is not a bank card or a central bank digital currency and is separate from that payment system. HUMO Digital, a private company, is listed by the National Agency for Perspective Projects (NAPP) as the stablecoin’s issuer. The project is being conducted under the joint supervision of the Central Bank and NAPP. Until now, crypto assets could not legally be used to pay directly for goods and services in Uzbekistan. The Central Bank and NAPP have decided to test an exception under a special regulatory regime. On September 2, HUMO Digital was registered to take part in the experiment. The project will test the issuance, circulation, and redemption of HUMO, as well as its use to pay for goods and services. More than 20 companies are prepared to accept the tokens during the pilot. Asterium, which is licensed as a crypto exchange, crypto depository, and crypto shop, is also participating in the project. Each HUMO issued is to be backed by Uzbek government securities. In practice, that means HUMO Digital will hold government debt as collateral behind the tokens it issues. The Central Bank will monitor whether there are enough assets backing the tokens and whether those assets are safely held. It will also assess whether payments and consumers are adequately protected, along with any effects that wider use of HUMO could have on inflation, monetary policy, and financial stability. The experiment is initially planned for 12 months. It can be extended, although the project cannot last more than three years in total. The results will help regulators decide how such digital financial instruments should be regulated in the future. The choice of the soum sets the Uzbek project apart from most of the global stablecoin market. Neighboring Kazakhstan is also exploring a potential stablecoin, although its proposed structure has not been disclosed. Nearly all major stablecoins are pegged to the U.S. dollar. According to the Bank for International Settlements (BIS), approximately 98% of stablecoin value is denominated in dollars. The best-known examples are Tether (USDT) and USD Coin (USDC). In effect, they allow users to hold and transfer something closely tied to the value of the dollar at any time and across borders. For countries with their own currencies, that convenience can create a problem. If people increasingly save or pay in dollar-backed tokens instead of the local currency, the local currency can lose ground. The BIS warns that widespread stablecoin adoption in emerging economies could accelerate what it calls digital dollarization and make it harder for central banks to manage their economies. Tashkent...

Gas

Gazprom Central Asia Gas Supplies Rise Nearly 70% in 2026

Gazprom has increased gas supplies to Kazakhstan, Kyrgyzstan, and Uzbekistan by nearly 70% so far in 2026. Gazprom CEO Alexey Miller announced the increase on September 4 but did not disclose how much gas each of the three countries received. The most significant changes are taking place in Uzbekistan. Until recently, the country was a major gas producer and exporter, but in 2023 it became a net importer. Since then, Tashkent has increased purchases from Russia and Turkmenistan. In 2025, Gazprom supplied Uzbekistan with 6.48 billion cubic meters of gas, 15% more than a year earlier. Russian gas reaches the country through Kazakhstan via the Central Asia–Center pipeline system. Built during the Soviet era to carry Central Asian gas northward to Russia, part of the system now operates in reverse. Supplies continue to rise. The International Energy Agency expects Russian gas supplies to Uzbekistan to exceed ten billion cubic meters in 2026. The reason is evident in Uzbekistan’s own production figures. The country produced 18.3 billion cubic meters of natural gas in the first half of 2026, down 16.4% from a year earlier. Gas imports reached $971.7 million. Russia and Turkmenistan remain the main external suppliers. Tashkent is trying to reverse the decline. Uzbekneftegaz has ordered new wells to be brought online and 16 existing wells to be overhauled, measures intended to add a combined 4.36 million cubic meters per day to production. Kazakhstan is in a different position. It produced 68.2 billion cubic meters of gas in 2025, but marketable gas production was only 27.4 billion cubic meters. Kazakhstan has also become the transit link between Russia and Uzbekistan. Part of the increase reported by Gazprom also reflects direct supplies to Kazakhstan, although the company has not provided a breakdown among the three countries. Kyrgyzstan’s gas market is considerably smaller. The country consumes around 500 million cubic meters a year and is more dependent on imports. Bishkek has signed long-term agreements with Gazprom for gas supplies to the planned CHP-2 and Bishkekselmash power plants through 2040. The increase in Central Asian sales comes as the geography of Russian gas exports has changed dramatically. Following Russia’s invasion of Ukraine and the sharp decline in deliveries to Europe, Gazprom has been looking for more customers to the east and south. China remains Russia’s largest gas market outside the former Soviet Union. Russia expects to supply China with around 50 billion cubic meters of gas this year. Power of Siberia is already operating at around its design capacity, while another route from Russia’s Far East is scheduled to begin deliveries in January 2027. Moscow and Beijing are also discussing a major new pipeline from Western Siberia through Mongolia. Central Asia, however, is not becoming an exclusively Russian gas market. Turkmenistan remains a major supplier to Uzbekistan, while Uzbekistan in particular is rapidly adding solar and wind generation, helping limit gas demand for power generation. But the direction of gas flows has already changed in a literal sense. The Central Asia–Center system was once built to carry...

Nuclear Energy

Uzbekistan Plans Joint Venture to Oversee Nuclear Power Plant

Uzbekistan has proposed creating a joint engineering venture with a foreign partner to provide independent technical oversight of its first nuclear power plant. The venture would review the plant’s design and equipment and monitor construction quality at the site in the Jizzakh region. Uzbekistan’s Atomic Energy Agency (Uzatom) set out the proposal in a September 4 report. The agency has not named potential foreign participants or said when the venture could be established. Construction formally began on June 4 with the first concrete pour for the plant’s first small modular reactor unit. Foundation work is now underway. The project calls for two VVER-1000 reactors and two small modular RITM-200N reactors at a single site. Uzbekistan describes this configuration as an integrated nuclear power plant. Uzatom says design work and construction of external utility networks will continue through the end of 2026. In 2027, authorities plan to order major equipment with lengthy manufacturing lead times. From June 22 to 26, the International Atomic Energy Agency conducted a Phase 2 Integrated Nuclear Infrastructure Review follow-up mission in Uzbekistan. The IAEA said Uzbekistan had made “significant progress” since its 2021 review, while identifying further work needed to improve the nuclear regulator and complete feasibility studies. The final mission report is expected to be published by the agency. Uzatom says the project’s environmental impact assessment has been approved and the necessary permits and licenses have been obtained for the siting and construction of the small modular units. Licensing for the larger VVER reactors is due to continue in 2027. More than 30 companies in Uzbekistan are being considered to supply cables and construction materials for the plant. Uzatom estimates that locally produced goods could account for around 21%, while authorities intend to raise the share above 30%. A specialized 200-hectare industrial zone has been proposed in the Forish district, around 25 kilometers from the nuclear power plant. It could support production in 15 sectors and create up to 2,000 jobs. Domestic firms are also expected to handle much of the work on the site’s utility and transport connections. A new town planned nearby would eventually house up to 33,000 people. At the peak of construction, the project will require more than 10,000 workers and specialists. Authorities plan for local personnel to account for 65%–70% of the workforce. Since 2023, 216 students have graduated from the Tashkent branch of Russia’s National Research Nuclear University MEPhI. Of these, 83 are continuing their studies at universities in China, Hungary, France, Italy, and South Korea. Four universities in Uzbekistan are training around 100 more specialists. Uzatom also plans to use the proposed engineering venture to transfer technical and project-management expertise to local specialists.

Nuclear Power Plant

Uzbekistan Nuclear Power Plant Targets More Local Production in $9.5 Billion Project

Construction is underway on Uzbekistan’s first nuclear power plant, a $9.5 billion project in the Jizzakh Region. The government wants Uzbek companies to take on a larger share of construction and equipment production, while work is also beginning on infrastructure and a new town alongside the plant. The project entered the construction phase on June 4. Excavation for the reactor building has now been completed, with more than 1 million cubic meters of soil removed. Uzbek-made products are currently expected to account for 21% of the project, or about $1.9 billion. Authorities want to raise that share to at least 30%, while local companies are expected to carry out 65% of construction and installation work. The government says up to 7,000 Uzbek workers and specialists could be involved at different stages of construction. For now, however, the project remains reliant on foreign expertise: the general contractor is Atomstroyexport, the engineering division of Russia’s state nuclear corporation Rosatom. As part of the push to increase local participation, authorities plan to create a 200-hectare industrial zone in the Forish District. It could host at least 100 joint ventures, with local production established in 15 areas, including through the transfer of foreign technology. The government is also preparing tax and customs incentives intended to encourage local production. The Jizzakh project has expanded significantly since it was first agreed. The original deal with Rosatom envisaged a small nuclear power plant consisting of six RITM-200N reactors. The concept was later revised: the integrated complex is now planned to combine two large VVER-1000 units with two RITM-200N small modular reactors. The plant will also require extensive supporting infrastructure, including new power lines, 120 kilometers of water pipelines, 40 kilometers of roads, and 11 kilometers of railway. Authorities want locally produced goods and services to account for 60%-70% of this infrastructure work. A separate town for plant employees and their families is planned next to the site. Around 10,000 homes and apartments for nearly 33,000 people are expected to be built on 200 hectares. Uzbekistan is also developing the technical and regulatory capacity needed to oversee a project of this scale. The government is considering a joint venture with foreign engineering companies to provide independent technical assessments during construction. In June, a mission from the UN’s International Atomic Energy Agency (IAEA) visited Uzbekistan to review the country’s progress in developing the national infrastructure needed for a nuclear power program. The reliance on foreign expertise has also prompted efforts to train a domestic nuclear workforce. Since 2023, 216 students have graduated from the Tashkent branch of Russia’s National Research Nuclear University MEPhI. Of these, 83 are continuing their master’s or postgraduate studies at institutions abroad. Around 100 more future nuclear industry specialists are studying at four higher education institutions in Uzbekistan. Uzbekistan’s nuclear plans are developing as electricity consumption grows rapidly. The country is simultaneously building solar and wind power plants, developing hydropower, and seeking to reduce the amount of natural gas burned to generate electricity. The nuclear plant is...

Uzbekistan Migration

Uzbekistan Labor Migration Looks to New Markets in Europe and Asia

Uzbekistan is looking for new destinations for labor migration at a time when aging populations are creating worker shortages from Germany to Japan. For a country whose migration model has for decades been closely tied primarily to Russia, labor shortages in developed economies offer an opportunity to diversify, but they also require workers to meet significantly higher standards. The Central Bank of Uzbekistan has analyzed the outlook for the global labor market through 2030. It expects demand for foreign workers to grow across sectors ranging from healthcare and construction to logistics and information technology. Europe is one of the largest potential markets. Aging populations and a shrinking working-age population are expected to intensify existing labor shortages. These shortages are expected to be particularly pronounced in engineering, construction, healthcare, and technology. Germany faces one of the most serious demographic challenges. The country’s Institute for Employment Research estimates that annual net immigration of around 400,000 people would be needed to keep its labor force potential broadly stable. Demand is expected to grow particularly rapidly in healthcare and elderly care. Germany already had nearly 5.7 million people officially classified as requiring care in 2023. In England, Skills England estimates that around 90,000 additional care workers and home carers could be needed between 2025 and 2030. Another growing labor market is linked to the energy transition. The construction and maintenance of solar and wind power facilities is increasing demand for installers, mechanics, engineers, and technical personnel. Major labor shortages are also expected in East Asia. Japan could face an overall shortage of around 6.4 million workers by 2030, according to a widely cited projection by Persol Research and Consulting. South Korea is also facing labor shortages in shipbuilding and other industrial sectors. Another potential destination is the Gulf. Saudi Arabia and the United Arab Emirates are investing heavily in construction, tourism, transport, healthcare, and services as they diversify their economies. One 2025 forecast estimated that the UAE alone could add more than 1 million jobs by 2030. For Uzbekistan, these changes coincide with a gradual expansion in the geography of its own labor migration. Russia remains the main foreign labor market for Uzbek citizens, but tighter Russian migration rules and rising costs for workers are increasing interest in other destinations. In the first half of 2026, work-purpose entries into Russia by citizens of Uzbekistan, Tajikistan, and Kyrgyzstan fell by 15% compared with the same period a year earlier. Uzbekistan already organizes employment opportunities for its citizens in South Korea, the United Kingdom, Germany, and other countries. In its labor market review for the first quarter of 2026, the Central Bank specifically noted the continuing diversification of migration and an increase in the number of Uzbek citizens in Turkey and South Korea. The shift is also visible in remittances. Uzbekistan received $9.3 billion in cross-border transfers in the first half of 2026, up 13% from a year earlier. Transfers from the United Kingdom increased by 62%, those from European Union countries by 27%, and those...