Uzbekistan Quality Job Creation as a Cornerstone for Sustainable Economic Growth

Enterprises, Developing Economies, 2016
Microenterprise
Uzbekistan
MSME finance gap
$11.8 billion
(17% of GDP, 2016)
SME
278
140
111
57
46
86
2,110
636
1,098
138
291
245
0
500
1,000
1,500
2,000
2,500
East Asia
and Pacific
Europe and
Central Asia
Latin America
and
Caribbean
Middle East
and
North Africa
South Asia Sub-Saharan
Africa
$ billion

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Uzbekistan Quality Job Creation as a Cornerstone for Sustainable Economic Growth
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is not utilized as collateral for loans as its ownership is basically held by the 
government. The American Chamber of Commerce reported that a lack of 
proper financial reporting (based on the International Financial Reporting 
Standards) is a major challenge for SMEs seeking access to formal financial 
services. Private sector commercial banks (Ipak Yuli Bank, Hamkorbank, and 
Davrbank) raised common demand-side issues behind limited access to 
finance for small businesses: a lack of transparency in their business records, 
inaccurate financial reporting, insufficient cash flow and collateral, and low 
financial literacy. They also noted that the difficulty of obtaining information on 
borrowers from external sources impedes loan processing to small businesses, 
and that the country’s financial infrastructure, including the credit bureau 
system and collateral registry, are in the early stage of development.
4.3.2. Small business access to finance 
Data on commercial bank loans to small businesses are available from January 
2017. Small business loans disbursed during the first half of 2018 amounted to 
SUM15,403 billion ($1,957 million), of which 89% were loans to legal entities 
and the remaining 11% went to individual entrepreneurs (Figure 4.18a). Lending 
to small businesses is increasing, but accounted for only 2.1% of the total 
commercial bank loans disbursed in the first half of 2018. Thus, the access of 
small businesses to bank credit is quite limited.
Small business loans are concentrated in Tashkent city, accounting for 35% of 
the total small business loans disbursed in the first half of 2018 (Figure 4.18b). 
Nationally, three sectors combined—agriculture, industry, and construction—
accounted for 54% of the total small business loans disbursed in that period, 
of which industry (manufacturing) had the largest share, at 33% (Figure 4.18c). 
The remaining 46% went to services-related small businesses, of which trade 
and catering services had the largest share, at 19%. 
Recall from section 4.1 that services-related businesses comprise 60% of small 
businesses in number but absorb only 40% of small business workers and 
provide only 40% of small business GVA. As a whole, insufficient credit supply 
to services-related small businesses may be dampening their employment 
and GVA. However, given that the delivery of small business loans was 
concentrated in the capital city, small businesses based in Tashkent city could 
have a relatively good environment for accessing bank loans, which may be 
contributing to the relatively large GVA in the capital city; however, the credit 
supply seems not to have created many jobs in the city, as small businesses 
there employ only 6% of all small business workers. 

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