Uzbekistan Quality Job Creation as a Cornerstone for Sustainable Economic Growth

Promoting internationalization of SMEs through global value chains
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Uzbekistan’s export structure has changed from heavy reliance on cotton and 
natural resources to a more diverse range of processed products and services, 
bringing new business opportunities for export-oriented and internationalized 
SMEs. The government could usefully promote the internationalization 
of SMEs by encouraging their active participation in global value chains. 
Benefits for SMEs could include increased competitiveness through vertical 
linkages with multinational lead firms, enhanced technology transfer to 
upgrade product quality, and resultant business expansion to overseas 
marketplaces, with associated job creation. It would be difficult for SMEs 

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Private Sector Development and Access to Finance
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to grow by themselves, but they could do so if engaged in relationships and 
business partnerships with lead firms and value chain actors in their areas of 
operations. The government support measures should include developing 
agricultural value chains, given the growth potential of agribusinesses and 
their contribution to agriculture and manufacturing. Special economic zones 
for SMEs may be worth considering as well. 
Establishing high-quality financial infrastructure to modernize the 
banking sector. 
Financial sector development is essential to promote private 
sector development, associated job creation, and sustainable economic 
growth. A sound financial system requires high-quality financial infrastructure 
to support effective financial outreach to private sector businesses, especially 
SMEs. Three essential infrastructure components are a credit data platform, 
a secured lending legal system, and credit guarantees. These need to be 
supplemented by a financial education system to facilitate the active use 
of the infrastructure. The credit market has been expanding in Uzbekistan, 
but SMEs have yet to benefit sufficiently from that expansion. Credit 
enhancement schemes supported by a credit bureau, a collateral registry, 
and credit guarantees should be created and strengthened to modernize the 
banking sector and enhance SMEs’ access to finance. Developing a credit risk 
database modeled on Japan’s also is worth considering.