37
DIMENSION 1:
ASSESSING DEVELOPMENT FINANCE FLOWS
Uzbekistan focuses mainly on rural development
and the agriculture sector, including horticulture,
irrigation, water
management, livestock and
professional education. They also work closely
with the Uzbek government to improve sector
governance and public administration reform.
Through the EU’s Investment Facility for Central
Asia (IFCA)
40
the European Investment Bank (EIB)
and bilateral partners funds key infrastructures
which cannot yet be adequately funded on financial
markets because they are considered as too risky.
In Uzbekistan, IFCA co-funds EIB’s and Agence
Française de Développement’s (AFD)
sovereign
loans in water management, energy / hydro-energy,
solid waste management and environmental
infrastructure projects, including technical assistance
and capacity building for the national authorities. Between 2014 and 2019, EUR 33.5 million
of the EU IFCA grants leveraged EUR 780.43 million of loans
from the EIB and the AFD
41
.
Through IFCA the EU seeks to contribute to the SDGs related to clean water and sanitation,
affordable clean energy, decent work and economic growth as well as climate action. To
date, the EBRD has invested a cumulative EUR 906 million in Uzbekistan. Its current portfolio
amounts to EUR 88 million, spread over 11 active projects. Strategic priorities for the EBRD’s
engagement in Uzbekistan are i) enhancing competitiveness by strengthening the private
sector’s role in the economy; ii) promoting green energy; and, iii) support regional and
international co-operation and integration.
Uzbekistan also participates in several regional EU-sponsored projects and initiatives:
BOMCA
on border control, CADAP on drug prevention, WECOOP on water, environment and
climate change, CAWEP on water and energy security with the WBG, Rule of Law, Central Asia
Invest and Ready4Trade.
Not
including China
42
, non-DAC donors remain marginal in Uzbekistan, albeit increasing.
The three largest non-DAC donors are Saudi Arabia, Kuwait and Turkey (Figure 13). Their
total ODA remains marginal, but marks an increasing trend. ODA from Russia, being the
country’s
main trading partner, is surprisingly limited. As an Islamic country, Uzbekistan has
a great potential to further explore Islamic finance and effectively engage with development
agencies in the Islamic countries, especially in the Arabian Gulf (Saudi Arabia, UAE, Kuwait
and Qatar).
The sectoral allocation of ODA is balanced (Figure 14). The energy sector has attracted 18
percent of total ODA. The relative priorities of donors seem to have shifted lightly over the
period 2010-18. ODA to the energy sector as well as to the banking and financial services
has noted a marked increase, whereas ODA to education and government and civil society
has declined significantly in proportion.
40
The IFCA is a EU blending investment instrument for Central Asia to co-fund vital socio-economic infrastructure
investment projects that benefit societies at large.
41
In 2019 alone, 4 IFCA grants of a total of EUR 25.25 million leveraged EUR 752.93 million of loans from EIB and AFD.
42
China does not report to the OECD DAC. There are no available estimates regarding China’s concessional finance
to Uzbekistan.
Saudi Arabia
81
Kuwait
56
Turkey
32
Israel
03
Russia
03
Other
01
Figure 13 Total ODA from non-DAC
donors to Uzbekistan (USD millions)
Source: OECD, 2020.
38
DEVELOPMENT FINANCE ASSESSMENT FOR
THE REPUBLIC OF UZBEKISTAN
According to the RIO markers
43
, the share of climate finance within total bilateral ODA
commitments is relatively small and on a downward trend in Uzbekistan (Figure 15). Except
for 2014, where it peaked at 64 percent, the average share of climate finance commitments
hovered around 20 percent since 2010. The peak in 2014 is due to the commitment by JICA
to finance a natural gas-fired electric power plant, valued at USD 655 million
44
.
43
Since 1998, the DAC has monitored development finance flows targeting the objectives of the Rio Conventions on
biodiversity, climate change and desertification through the CRS using the so-called “Rio markers”.
44
The Turakurgan thermal power station construction project.
Figure 14 Sectoral allocation of ODA
Source: OECD, 2020.
Note:
Total ODA includes
both grants and loans
0%
50%
Trade Policies &
Regulations Tourism
Business &
Other Services
Energy
Education
Communications
Government & Civil Society
Transport & Storage
Other Social Infrastructure
& Services
Industry, Mining,
Construction
Population Policies/Programmes
&
Reproductive Health
Health
Other Multisector
Water Supply & Sanitation
Agriculture, Forestry,
Fishing
General Environment
Protection
Banking & Financial
Services
DAC Countries
Multilaterals
0%
5%
10%
15%
20%
25%
30%
35%
E
n
e
rg
y
W
ater
S
u
p
p
ly
&
S
a
n
it
atio
n
Agricultur
e,
F
o
restr
y,
Fishin
g
Health
Tr
anspor
t
&
Storage
Other
B
a
n
ki
n
g
&
F
inancial
Ser
v
ic
e
s
M
u
lt
i-
S
e
ct
o
r
/
C
ross-
Cutting
Education
Other
Social
In
fr
astructu
re
&
Ser
vi
ces
In
d
u
st
ry
,
M
in
in
g
,
C
o
n
st
ru
ct
io
n
Government
&
C
iv
il
Society
p
e
rc
e
n
t
o
f
to
ta
l
O
D
A
2010-14
2015-18
100%
Total ODA 2002-18
Figure 15 Total bilateral ODA commitments with environmental objectives
0
500
1000
1500
2000
2500
3000
3500
E
n
e
rg
y
A
g
ri
cu
lt
u
re
,
F
o
re
st
ry
,
F
is
h
in
g
Tr
a
n
sp
o
rt
&
S
to
ra
g
e
W
at
e
r
S
u
p
p
ly
&
S
anitation
O
th
e
r
USD
million,
cur
re
nt
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