Development finance assessment

2016-19
Source: GoU
Civil society Organizations
The volume of INGOs’ operations in the country is still rather small, but growing
67
. An 
association and a Fund for support of non-governmental and non-commercial organizations 
of Uzbekistan were established in 2005. Reportedly, by December 2016 the association 
embraced more than 550 different NGOs and the fund provided about UZS 9 billion in 
financial resources for various NGO projects (BTI, 2018).
67
In the 2000s many international NGOs (INGOs) had been banned from the country. With the recent opening of 
the country they have been allowed to resume operations or begin new ones..
Figure 21 Remittances inflows
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
40 000
2017
2018
2019 (e)
2020 (p)
2021(p)
2022(p)
2023(p)
2024(p)
U
S
D
m
ill
io
n
,
co
n
st
a
n
t
Source: IMF 2020.

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DIMENSION 2: 
INTEGRATED PLANNING AND BUDGETING
DIMENSION 2:
INTEGRATED PLANNING 
AND BUDGETING
This chapter explores the alignment between Uzbekistan’s planning and finance policy 
functions. It considers both opportunities for strengthening the connection between the 
annual and medium-term budget process with long-term plans as well as alignment across 
different finance policies such as those governing the budget, private sector development, 
green development, etc. Operationalizing an INFF could help the GoU effectively strengthen 
the integration of its budgeting, planning and financing processes. 
LONG-TERM DEVELOPMENT VISION
The Action Strategy 2017-21 sets out the GoU’s sustainable development priorities. The 
extent of how it reflects the development aspirations of ordinary Uzbek citizens is unclear. It 
is an aspirational document, rather than a policy tool to guide decision-making and priority 
resource allocations. While stated to be aligned with the SDGs, these could be mainstreamed 
more explicitly across the document. 
To implement its Action Strategy, at the beginning of each year the government adopts a 
very detailed plan of actions with somewhat more specific deliverables and priorities. These 
annual plans are not costed, nor come with clear guidance on how they should be financed. 
The availability of resources (or lack of them) is a critical challenge to the credibility of these 
national plans. These annual plans are openly formulated and presented to the public at the 
end of the preceding year for collecting feedback. This process of monitoring and organizing 
public consultations is administered by the Development Strategy Center, an NGO linked to 
the GoU.
To date, there is no long-term development vision that would set out development 
guidance beyond 2021. At the sectoral level, Uzbekistan has laid out its vision for sectoral 
development beyond 2021 in the transport sector (Strategy for the Development of the 
Transport System until 2035), the energy sector (Concept of Development of the Hydropower 
Industry 2020-2024) and specific industries (Concept of Development of the Textile, Garment 
and Knitwear Industry 2020-2024). A process was started to formulate a “Concept for 
Comprehensive Socio-Economic Development of the Republic of Uzbekistan until 2030” 
(henceforth: the ‘Concept’). 
The final status and function of this Concept
68
remains unclear to date. It could be 
envisaged however as a first step towards developing an INFF: it provides a comprehensive 
and ambitious, long-term, shared vision for the country’s socio-economic development path. 
Ideally, such a development vision would have to be articulated at a sufficiently high level to 
remain relevant over the longer term, while specific enough to enable informing medium-
term development strategies with their corresponding action plans and sectoral policies.
In the absence of a formal national long-term development vision or strategy, the 
nationalized Sustainable Development Goals provide a comprehensive and internationally 
68
Currently the Concept states the GoU aims to achieve upper middle-income country status, according to the World 
Bank classification. This would imply tripling the dollar denominated GDP per capita by 2030 – to reach USD 4,538, 
compared to USD 1,533 in 2018. This would require sustaining an average annual economic growth of at least 6.4 
percent throughout the next decade. 

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DEVELOPMENT FINANCE ASSESSMENT FOR THE REPUBLIC OF UZBEKISTAN
supported vision for the future. The SDGs are a comprehensive and integrated 
development agenda that inherently supports such a whole-of-society approach. They 
provide a unique and tested framework to: (a) align Uzbekistan’s short-term market and 
governance reform priorities with the longer-term focus of the 2030 Agenda; (b) contain 
Uzbekistan’s nationalized SDG targets and indicators, as well as relevant baseline and 
terminal values; (c) be linked to the national budgetary framework and relevant sectoral 
and subnational development programming; (d) serve as a programmatic basis for 
national SDG reporting; and, (e) inform and strengthen the performance monitoring of 
the draft Concept (UNDP, 2018).
However, the socio-economic impact of the COVID-19 crisis now risks significantly 
derailing SDG progress in Uzbekistan. This DFA therefore aims to inform a holistic financing 
strategy for the GoU’s COVID-19 response and recovery towards a sustainable and resilient 
recovery that safe-guards SDG progress. 
Such an effective holistic financing strategy would require a realistic cost assessment that 
considers the differentiated impact of the COVID-19 crisis on different parts of the population 
and regions. It would specify how authorities expect different development finance flows, 
public and private, to cover these financing needs; along with a monitoring and evaluation 
system of the contribution of each development finance flows and stakeholder towards the 
country’s development outcomes. In addition, the unfolding COVID-19 pandemic revealed 
the importance of mainstreaming risk resilience across the state planning system and the 
SDG financing architecture. 
MEDIUM-TERM DEVELOPMENT PLANNING
Uzbekistan’s medium-term national development policy framework is articulated in the 
“Action Strategy on Five Priority Areas of the Development of the Republic of Uzbekistan for 
2017-2021
”. The Action Strategy focuses on five priority areas: 1) public and state (political) 
infrastructure/architecture; 2) rule of law and judicial/legal system; 3) economic development 
and liberalization; 4) social sphere development, and, 5) security, inter-ethnic harmony and 
religious tolerance (with balanced foreign policy). Each priority area is assigned several 
objectives/sub-objectives which makes the areas more tangible and easier to monitor. This 
framework is aligned with the SDGs.
Subsequently, many sectoral and sub-sectoral strategies, some of them costed, have 
been developed. Effective coordination and coherence among these multiple plans and 
strategies is an important challenge towards achieving development results. Duplications 
and contradicting priorities may lead to suboptimal outcomes. 
In 2020, the Ministry of Economy and Industry was transformed into the Ministry of 
Economic Development and Poverty Reduction. This important institutional reform aims to 
improve more effective and transparent coordination of the multiple, fast-paced economic 
reforms. Tasked with ensuring unity of action and policy coherence across the government, 
the new Ministry will coordinate all medium and long-term concepts, strategies and programs 
for the development of industries and territories. It will also analyze all the adopted socio-
economic documents in terms of their impact on poverty. 
Before the end of 2020, the Ministry is expected to finalize three key strategic documents 
that will jointly frame the GoU’s socio-economic development: i) draft Concept; ii) the Poverty 
Reduction Strategy; and, iii) draft decree of the head of state on introducing a minimum 
consumer basket and a living wage in all regions as of 2021. The concomitant finalization 
of these three critical development policy documents will provide a timely opportunity to 
mainstream their socio-economic targets across the COVID-19 recovery.

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