Uzbekistan Quality Job Creation as a Cornerstone for Sustainable Economic Growth

Uzbekistan Quality Job Creation as a Cornerstone for Sustainable Economic Growth
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of a major gas pipeline from Turkmenistan has been completed and a second 
pipeline through Uzbekistan is scheduled (Farchy 2016).
In the last decade, the PRC has been actively reviving the old Silk Road trading 
route through its Belt and Road Initiative (BRI) that came into force in 2015. 
The BRI aspires to create a new Eurasian land bridge through transport and 
infrastructure development, financial integration, and trade liberalization 
(NDRC 2015). The BRI contains land- and marine-based routes, of which the 
former runs through the PRC–Central Asia–West Asia economic corridor. 
Asia and Europe account for more than a quarter of world trade, hence lowering 
trade costs could have a significant global impact (Konings 2018). Individual 
countries’ potential trade gains from the BRI have been estimated using gravity 
models of international trade. Specifically, a 50% reduction in trade costs
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could increase world trade from 4% to 12%, depending on the locality. For 
Uzbekistan, the estimated increase in trade was approximately 28%, one of 
the largest increases due to the BRI projects. 
Improved logistics and infrastructure are also believed to increase FDI in the 
region. However, until recently, one of the biggest issues concerning FDI into 
Uzbekistan was the ability to repatriate profits to the home country in the face 
of restrictions on capital outflows. In this regard, recently the Central Bank of 
Uzbekistan proposed amending the law on currency regulation and currency 
control, to remove restrictions on profit repatriation of FDI. Moreover, the 
Central Bank proposes to allow residents to open and use accounts in foreign 
banks. This, in combination with BRI projects, should improve Uzbekistan’s 
investment climate, facilitate its trade, and attract more foreign investors. 
5.2. The Evolution of Trade and foreign Direct
Investment in Uzbekistan: Stylized facts
5.2.1. Exports and imports
Figure 5.1 shows Uzbekistan’s total nominal exports and imports for 
1995–2018. Imports and exports increased simultaneously until the global 
economic crisis of 2008. Total exports and imports had increased from about 
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A 50% fall in trade costs was adopted because the BRI projects combine both transport costs reduction and 
trade facilitation measures. The WTO (2015) calculated that trade facilitation among the BRI countries could 
reduce the trade costs by 12%–23%.

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