Investment
Business Sectors
Uzbekistan possess considerable economic potential. Over the years of independence such sectors as automobile manufacturing, agricultural machinery, oil and gas, chemical, light, pharmaceutical and food industries gained new development impetus.
Oil and Gas Industry
The history of the oil and gas industry of Uzbekistan dates back to 1885. Today, the country is one of the largest suppliers of energy resources to foreign markets. Oil and gas industry is represented by National holding Company (NhC) “Uzbekneftegaz”. It consists of six major joint stock companies, comprising more than 120 enterprises of the complex. they perform exploration, exploratory drilling and production drilling of oil and gas wells, oil and gas fields development, oil, gas and gas condensate production, natural gas processing, transportation and gas underground storage, management of the facilities that that transport natural gas from Uzbekistan to national consumers and abroad, as well as providing transit of the natural gas from neighboring countries, design works, capital construction and improvement of production, transport, oil and gas processing facilities, oil products are realized to economy sectors and population of the country, the production of engineering products for businesses and organizations of oil and gas and gas chemical complexes. The state is the major stake holder of the company. The main oil and gas bearing region of the country can be divided into five districts. These are Ustyurtsky, Bukhara-Khiva, Hissar, Surkhandarya and Fergana regions. To date, there are more than 232 discovered deposits of oil, gas and gas condensate. Out of them, 103 are being developed, 60 – ready for development, and 69 are in the process of study. The country has an extensive gas transportation system. The total length of gas pipeline is more than 13 thousand km. More than 250 compressor stations are located on their way.
Current Trends in Oil and Gas Industry
Over the years of independence Uzbekistan performed great deal of work to rehabilitate existing facilities, build new plants, booster compressor stations, gas underground storages. Currently, NhC operates two oil refineries – Ferghana and Bukhara oil refineries of 11.2 million tons of total output capacity a year, the Mubarek gas processing plant of 30.0 billion m3 of natural gas annual processing capacity, Shurtan gas processing plant of 20.0 billion m3 of gas annual processing capacity and Shurtan gas chemical complex of with a clearance capacity of 3.9 billion m3 of annual gas cleaning capacity and of 125,000 tons of annual polyethylene. Nowadays more over 20 joint ventures are operating within “Uzbekneftegaz”. Exploration is underway where leading companies such as “Gazprom” and “Lukoil” (Russia), “CNpC International” (China), “Petronas Carigal” (Malaysia), “Korea National Oil Corporation”, “Korea Gas Corporation” and “Daewoo International” (South Korea) are involved. As for newly-established joint ventures, they include “PetroVietnam” (Vietnam) and “Sasol” (South Africa). “Asia Trans Gas”, “Uz-Kor Gas Chemical”, “Uzbekistan GtL”, “Uzprista”, “Uz Dresser-rand”, etc. a few production Sharing agreements are implemented with “Gazprom” and “Lukoil” companies, as well as with the International Consortium of investors.
The industry develops in accordance with the Decree of the president of the republic of Uzbekistan “On the priorities of industrial development of Uzbekistan in 2011-2015 years”, according to which NhC “Uzbekneftegaz” will implement 37 investment projects of total value of 19.3 billion USD and 23 projects worthy about 7.1 billion USD are on development stage.
Future Developments in Oil and Gas Industry
“Uzbekneftegaz” together with foreign partners prepares a number of important investment projects, whose realization will have a significant impact on the fuel market pattern, both nationally and in the region. For instance:
- Project on construction of Ustyurt Gas chemical complex for Surgil deposit. The main foreign partner is a Consortium comprising “KOGaS”, “honam petrochemical Corp.” and “StX energy” South Korean companies. The project is implemented through international project financing and currently identification of the contractors to construct a process section is being carried out. Design capacity – 4.5 billion cubic meters of gas, as much as 400 thousand tons of polyethylene and nearly 100 thousand tons of polypropylene per year. The process Licensors is “KBr”, “Ortloff” and “UOp” (USA); this project of construction of Ustyurt Gas Chemical Complex on the basis of Surgil gas field was awarded as a deal of the year on oil and gas-chemical sector in 2012 by “project Finance International” of “thomson reuters”. Prize presentation ceremony took place on January 30, 2013 in London, Great Britain. Moreover, recently one of the worlds authoritative rating agencies – British “Dealogic” in association with leading US newspaper – “the Wall Street Journal” included the project of construction of Ustyurt Gas Chemical Complex to top ten investment projects of the world in 2012 along with projects on oil-gas, mining, transport and communication spheres, which are implemented in Australia, USa, France, Great Britain, Singapore and Germany;
- Project on construction of a plant to produce synthetic liquid fuels near Shurtan Gas Chemical Complex in Kashkadarya region. The main international partners are “Petronas Carigali” and “Sasol” companies. GtL production process based the SaSOL’s own process, will allow to annually process approximately 3.5 billion cubic meters of purified methane of the Shurtan Gas Chemical Complex and produce 1.7 million tonnes of highly liquid products (diesel fuel, jet fuel, naphtha, liquefied petroleum gas). Today only two similar commercial projects are realized in the world. Uzbek project will be another one.
Available Industry Benefits
- Legal framework contributing to creation of enabling environment for business and providing foreign investors with a broad package of benefits and privileges;
- Political and macroeconomic stability in the country, that guaranties for the investment’s security;
- Rich deposits of hydrocarbons, which helps to keep the relatively low prices for vital raw materials;
- Well-developed industrial infrastructure for all types of oil and gas operations, including exploration, production, refining and transportation of raw materials, equipment production and construction;
- Skilled professionals and educational institutions;
- Convenient geographical location of Uzbekistan.
PROSPECTIVE INVESTMENT PROJECTS
Oil and gas sector:
- Construction of the 2nd phase of the Bukhara refinery, including construction of the isomerization facility for the 1st phase. The purpose of the project is organization of annual production of 957 thousand tons of gasoline, 706 tons of diesel fuel and 250 tons of jet fuel;
- Further development of a Kultak field including construction of booster compressor station and reconstruction of the complex gas treatment plant to achieve annual production of up to 5.0 billion cubic meters of gas;
- Accelerated development of the near border gas condensate fields Samantepa, Girsan and tailak to increase additionally annual production of 3.2 billion cubic meters of natural gas.
- Construction of an organic synthesis plant to use raw materials from on USe “Mubarek gas processing plant “ for production of propane-butane butanediol and other types of synthetic rubber raw materials, poliester, pet, and polyurethane;
- Production of raw materials for synthetic yarns in Kashkadarya region, including production of butanediol, to be used for spandex production (raw materials for the textile industry), as well as other types of polymers that are used in textile, food and other industries;
- Production of amine and glycol from ethylene oxide on the base of USe “Mubarek gas processing plant”, including production of amines (Dea, MDea) and glycols (DeG, etc.) based on ethylene oxide.
- Mineral fertilizers and inorganic products (nitrogen, phosphate potash fertilizers, ammonia, caustic soda and soda ash);
- Organic chemistry, synthetic fibers and polymer materials (cellulose and cellulose acetate, fiber, acetate yarns, polyethylene products);
- Chemicals for energy and chemical industries, as well as for gold production (sodium cyanide, thiourea, polyacrylamides, azotic, sulfuric, hydrochloric acid, catalysts, acetic acid, acetylene, etc.);
- Chemical-based plant protection products (chlorate magnesium defoliant).
- “Navoi Beauty Cosmetics” JV LLC, established in partnership with “DK Cosmetics” company (South Korea) on production of 18 types of cosmetics; production capacity – 3.038 million units;
- “Navoiy hunan pulp” JV LLC, established in partnership with “hunan aloft” company (China) for production of baby diapers and other hygiene products; production capacity – 3.038 million units;
- “Dzhizak plastmassa” JSC started producing haberdashery, toys and consumer goods; annual productive capacity is nearly 582 tons;
- “Maxam Chirchik” OJSC began producing “porous ammonium nitrate” with an annual production capacity up to 60 thousand tons.
- 7 projects of total value of 1632.1 million U.S. dollars (on-going);
- 9 projects of total value of 421.5 million U.S. dollars (developing);
- 14 projects of total value of 813.5 million U.S. dollars (prospective).
- 7 projects on competitive products production volume expansion at existing enterprises of total value of 171.3 million U.S. dollars;
- 4 projects on production of import-substituting assemblies, raw materials and materials of total value of 79.0 million U.S. dollars;
- 3 projects subject to accelerated implementation by shortening deadlines set up for preparation and implementation time of the construction and installation works of total value of 278.5 million U.S. dollars.
- Legal framework contributing to creation of enabling environment for business and providing foreign investors with a broad package of benefits and privileges;
- Political and macroeconomic stability in the country, that guaranties for the investment’s security;
- Stable growing demand in Central Asia, Middle East, Southeast Asia and Eastern Europe;
- Availability of basic resources needed for the chemical industry, including relatively cheap natural gas and electricity;
- advanced transportation infrastructure and the necessary communication;
- Competent engineers and skilled labor force.
- Construction of the complex for production of ammonia and carbamide in the Navoi region, including annual production of 660 thousand tons of ammonia and 1 million tons of carbamide;
- Construction of a gas chemical complex for deep processing of natural gas based on the technology of production olefins from methanol (MTO) in the Bukhara region. Organization of annual production of 500 thousand tons of methanol, 192 thousand tons of ethylene / propylene, 150 tons of polyvinyl chloride (PVC), 90.0 thousand tons of caustic soda, etc.
- Construction of a plant for production of compound mineral fertilizers in Navoi region with annual production of 650 thousand tons of sulfuric acid, 143.5 thousand tons of phosphate fertilizer, 150 tons of NpK (nitrogen, phosphorus, potassium);
- New complex for production of polyvinyl chloride (PVC) and caustic soda with capacity of annual production of 100 thousand tons of pVC, 78.1 thousand tons of caustic soda, 295.4 thousand tons of methanol;
- Production of synthetic detergents and household products with annual production of 30 thousand tons of household goods.
- “Chevrolet” cars such as Malibu, Captiva, Lacetti, Nexia, Spark, Matiz and Damas models. Manufacturer
- “GM Uzbekistan” CJSC;
- Light trucks and medium trucks and “Isuzu” buses. Manufacturer – “Samauto” company;
- Heavy trucks “MaN”. Manufacturer – “JV MaN auto-Uzbekistan” JV LLC;
- Engines for “Chevrolet” cars. Manufacturer – “GM powertrain Uzbekistan” CJSC;
- Spares – Manufacturers – “Jizzakh battery plant” OJSC, “Uz-tong hong Ko” JV, “UzKodji” CJSC
- “Uz CLaaS agro” JV produces combine harvesters Dominator 130, tucano 430, arable tractor under brands axos 340, arion 630S, axion 850, forage harvester Jaguar 850, balers Markant 55. The enterprise was established at “tashkent tractor plant” OJSC (“ttp” OJSC) together with “CLaaS” and “CLaaS Central asia Investment Gmbh” Company (Germany) in February 2010.
- “LeMKeN Chirchiq” JV produces tillage machinery and other LeMKeN agricultural machinery. The enterprise was established at “Chirchiqqishloqmash” OJSC together with “LeMKeN Gmbh & Co. KG” (Germany) in December 2011. It is planned to organize production of the universal mounted reversible plows of “eurOral 73 +1” model, rotary harrows with active working apparatus of “Zirkon 8/250” model, rotary tillers “Smaragd 9/300” and soil sealants “Variopack110 WDp70”.
- Legal framework contributing to creation of enabling environment for business and providing foreign investors with a broad package of benefits and privileges;
- Political and macroeconomic stability in the country, that guaranties the investment’s security;
- Market access to CIS whose population is over 300 million people, and also the existence of an agreement on free trade zone with Russia, Ukraine, Belarus, Kazakhstan, Georgia, Armenia, Azerbaijan, Moldova, Kyrgyzstan;
- Convenient geographical location of the country;
- Skilled professionals and quality educational institutions;
- Relatively cheap energy.
- Production of assemblies and components of automobile power train (transmissions) with production capacity of up to 225 thousand units;
- Organization of production of under hood equipment for transfer of vehicles to compressed gas with annual production of 20 thousand units;
- Organization of production of engine blocks and other cast-iron work pieces by casting with annual production capacity of 25.0 tons;
- Production of exhaust systems for new models of “GM Uzbekistan” JV cars with annual production capacity of 100.0 thousand sets;
- Establishment of production of low-power electric engines, including those for the automotive industry. The purpose of the project annual production of 600 thousand electric engines for “GM Uzbekistan” cars and 200 thousand electric engines for household appliances;
- Establishment of production of automotive sound signals with annual production capacity of 540 thousand units of automotive sound signal devices;
- Establishment of production of automotive safety belts with annual production capacity of 270 thousand sets of automotive safety belts.
- Establishment of production of acoustic systems, including for “GM Uzbekistan” cars. The purpose of the project production of 500 thousand units of car speakers, 50 thousand loudspeakers for household appliances.
- Establishment of production of modern tractors in transport and cotton versions with capacity up to 100 horsepower. The purpose of the project annual production of 2.0 thousand units of tractors of new generation.
- Establishment of production of excavators and other construction equipment on the basis of “Urgench excavator” OJSC with annual production capacity of 200 units of excavators;
- establishment of production of modern laser ejectors and drill scrapers on the basis of “Chirchiqqishloqmash” OJSC with annual production capacity of 50 units of laser ejectors and 250 drill scrapers;
- Establishment of production of compact equipment (mini-techniques) on processing meat and milk products, manufacture of building materials. The purpose of project – annual production of 300 thousand units of equipment;
- Establishment of production of road-building machines and municipal engineering. The purpose of project – annual production of 200 units of road-building and municipal techniques;
- Establishment of production of rotary knitting machines with annual production of 100 units of knitting machines;
- Establishment of production of hosiery automats with annual production capacity of 100 units of hosiery automats.
- processing of copper resources (production of cables and wires);
- Production of industrial and technical products (production of transformers, substations, distribution panels, elevators, various accessories and key components for other industries);
- Production of complex household and radiotechnical products (tV sets, household and industrial refrigerators, air conditioners, electric kettles and irons);
- Maintenance and repair services.
- “White Machine technology” enterprise – production of electric vacuum cleaners under the “Samsung” brand established;
- “Neo Sun Light” JV – production of energy-saving fluorescent lamps, apartment air conditioners using “Midea” company technology, microwave ovens under the “Samsung” brand, gas stoves, “artel” brand air conditioners and tV sets established;
- “Eco electron” enterprise – production of household gas stoves of different modifications established;
- “Sino” enterprise – development of new models of household refrigerators and freezers;
- “Rav express” enterprise – production of copper pipes of different diameter established;
- “Uzkabel” JV, “andijankabel” JV and “Deutsche Kabel aG tashkent” JV enterprises – development of new types and brands of cabling and wiring products.
- “telecom Innovations” JV on production of DSLaM-equipment and aDSL-modems, established together with China’s Zte Corporation in Navoi Free Industrial economic Zone. The planned capacity of the enterprise allows annual output of 400 thousand units of equipment for access the internet. Moreover, this corporation is also actively participated in the project of electrification of the Tukimachi-Angren railway section.
- Expansion of the range of household gas stoves, development of electric stoves and mini stoves at “eco electron” Branch Company; the project costs 3.75 million U.S. dollars;
- Establishment of production of LCD TV sets at “White Machine technology” LLC JV with annual production capacity of 100 thousand units; the project costs 4.5 million U.S. dollars;
- Development of new TV sets models and modern cash registers, expansion of electronic scales production at “Foton” OJSC; the project costs 7 million U.S. dollars; also, during 2012-2015 production of refrigerators and air conditioners at the “Sino” company through technological upgrading and renovation of production facilities is planned to be expanded. Total project cost is of 16.2 million U.S. dollars. As it proceeds annual production capacity of “Sino” refrigerators output is expected to increase up to 150 thousand units.
- Moreover, in 2012, “hpS systems” JV was established in Navoi FIeZ, which will be engaged in the production of power cables with cross-linked insulation to the voltage of up to 400 kW. Currently, such kind of production doesn’t exist in the republic of Uzbekistan and Central Asia.
- Establishment of production of household refrigerators and freezers with annual capacity of 500 thousand units of refrigerators and freezers;
- Organization of production of LCD and LeD TV sets ¦ and monitors with annual capacity of 500 thousand units of TV sets and monitors;
- Production of washing machines with annual ¦ production capacity of 200 thousand units;
- Production of domestic air conditioners with annual ¦ capacity of 500 thousand units;
- Production of microwaves with annual capacity of ¦ 150 thousand units;
- Production of compressors for household ¦ appliances with annual capacity of 1 million units;
- Production of compressors for household appliances ¦ with annual capacity of 500 thousand units;
- Production of electric water pumps with annual ¦ capacity of 100 thousand units;
- production of personal computers, including ¦ off-station data input facilities (mice’s, keyboards and etc.) with annual production capacity of 100 thousand units of PCs;
- Production of printers and copying techniques with ¦ annual capacity of 100 thousand units of office equipment;
- Production of solar cell panels for photovoltaic ¦ stations with annual production capacity of 100 megawatt solar cell panels;
- Establishment of production of mobile phones with ¦ annual capacity of 2 million units;
- Production of solar water-heater systems (headers) ¦ with annual capacity of 10 thousand units of waterheater systems;
- Organization of production of light-emitting diode ¦ (LED) with annual capacity of 20 million units of LED;
- Organization of production of electronic security ¦ systems and video surveillance systems with annual capacity of 50 thousand units of security devices;
- Organization of production of loudspeakers, ¦ including for automotive industry with annual
- Production capacity of 150 thousand units of loudspeakers;
- Establishment of production of electric lighting ¦ facilities (chandeliers, lighting fittings and etc.) with annual production capacity of 10 thousand units of chandeliers and 1.5 million units of lighting fittings.
- Legal framework contributing to creation of enabling environment for business and providing foreign investors with a package of benefits and privileges;
- Political and macroeconomic stability in the country, that guaranties for the investment’s security;
- Market access to CIS whose population is over 300 million people, and also the existence of an agreement on free trade zone with Russia, Ukraine, Belarus, Kazakhstan, Georgia, Armenia, Azerbaijan, Moldova, Kyrgyzstan;
- Convenient geographic location of the country;
- Skilled professionals and quality educational institutions;
- Relatively cheap energy;
- Access to the unused buildings and structures under the zero value on the condition of mandatory investment.
- Necessary legal framework contributing to creation of enabling environment for business and providing foreign investors with a package of benefits and privileges;
- Political and macroeconomic stability in the country, that guaranties for the investment’s security;
- Necessary and relatively cheap raw materials such as cotton and silk;
- Market access to CIS whose population is over 300 million people, and also the existence of an agreement on free trade zone with Russia, Ukraine, Belarus, Kazakhstan, Georgia, Armenia, Azerbaijan, Moldova, Kyrgyzstan;
- Convenient geographic location of the country; – Skilled professionals and quality educational institutions;
- Relatively cheap energy;
- Access to the unused buildings and structures under the zero value on the condition of mandatory investment.
- Construction of textile complex to produce knitted fabrics and knitted garments with annual production of 17 thousand tons of knitted fabrics and 25 million units of knitted garments;
- Establishment of silk weaving production with annual production of 1.0 million m2 silk and mixed fabrics;
- Construction of textile complex with annual production of 8.0 tonnes of cotton yarn, 20.0 million m2 cotton fabrics, 10.0 million units of garments;
- Construction of textile complex with annual production of 20.0 thousand tons cotton yarn, 9.5 thousand tons of knitted fabric, 18.0 million units of knitted garments;
- Construction of textile complex with annual production of 12 thousand tons of cotton yarn, 15 million m2 of cotton fabrics and 15 million units of garments;
- Construction of textile complex to produce ¦ knitted fabrics and knitted garments with annual production of 17 thousand tons of knitted fabrics and 25 million units of knitted garments;
- Establishment of silk weaving production with ¦ annual production of 1.0 million m2 silk and mixed fabrics;
- Construction of textile complex with annual ¦ production of 8.0 tonnes of cotton yarn, 20.0 million m2 cotton fabrics, 10.0 million units of garments;
- Construction of textile complex with annual ¦ production of 20.0 thousand tons cotton yarn, 9.5 thousand tons of knitted fabric, 18.0 million units of knitted garments;
- Construction of textile complex with annual ¦ production of 12 thousand tons of cotton yarn, 15 million m2 of cotton fabrics and 15 million units of garments; establishing of spinning and weaving and dyeing and finishing production with annual production of 10.0 thousand tons of cotton yarn, 10.0 million m2 of fabrics; establishment of spinning production with annual capacity of 4.0 thousand tons of cotton yarn;
- Establishment of textile complex with annual production of 6.0 thousand tons of cotton yarn, 15.0 million square meter of cotton fabrics and 13.0 million tons of garments;
- Organization of hosiery production with annual capacity of 9.0 million pairs of hosiery;
- Production of finished cotton, jeans, mixed (wool) fabrics and finished outerwear with annual capacity of 15.0 million square meters of cotton fabrics and 20.0 million units of knitwear;
- Establishment of production of hosiery with annual capacity of 30.0 million pairs of hosiery.
- Tashkent research Institute of Vaccines and Sera;
- Uzbek Chemical and pharmaceutical research Institute;
- Institute of Chemistry of Vegetable Substances;
- Institute of Bioorganic Chemistry;
- Institute of Chemistry and physics of polymers;
- Botanika R&D Centre;
- Oriental Medicine research Institute;
- And Vaktsina NpO.
- promoting national medical drug security. Its key aspect is guaranteed production of a number of drugs from substances to finished medical drugs;
- Increase in number of high-quality domestic medicines, covering market for at least 45-50%. to this end, investments for implementation of specific manufacturing projects are being promoted;
- promoting innovative domestic drugs into the market. It is planned in prospect to focus efforts on production of universal generics in all forms, including tablets, capsules, injectable drugs, infusion fluids, punctures and other, as well as immunological and psychotropic drugs, insulin, anti-cancer drugs, medicines from plant material.
- Legal framework contributing to creation of enabling environment for business and providing foreign investors with a package of benefits and privileges;
- Political and macroeconomic stability in the country, that guaranties for the investment’s security;
- Market access to CIS whose population is over 300 million people, and also the existence of an agreement on free trade zone with Russia, Ukraine, Belarus, Kazakhstan, Georgia, Armenia, Azerbaijan, Moldova, Kyrgyzstan. Moreover, only Central Asian countries annual demand is more over 15.4 million of standard units;
- Existence of research institutions, highly skilled professionals and availability of educational institutions;
- Rich natural plant world of Uzbekistan: 138 families, 1023 genera, and 4,500 species, of which 1,150 species are considered to be medical plants. Officially more than 100 medicinal plant species are included in the pharmacopea, which enables to produce original medications and biologically active additives using local raw materials;
- Relatively cheap energy;
- Access to the unused buildings and structures under the zero value on the condition of mandatory investment;
- Growing domestic market (with 29.5 million population). Total annual domestic demand is 6.6 million standard units of drugs.
- Establishment of production of insulin, intravenous solutions and other products. Project purpose production of 250 million doses of insulin in cartridges, intravenous solutions and other products;
- Establishment of production of substances and drugs (cephalosporin antibiotics) with annual capacity of at least 100.0 million bottles of antibiotics;
- Establishment of production of vitamin-enriched medical drugs with annual production capacity of 2.0 million units;
- Establishment of production of drugs to treat endocrine-related diseases with annual production capacity of 5.0 million tablets;
- Establishment of manufacturing drugs for cancer treatment with capacity of 1.0 million standard units of medicals;
- Establishment of production of anti-microbial preparations with annual production capacity of 50.0 million standard units of various antimicrobial agents;
- Construction of immunobiological preparations production facility with annual production capacity of 12 million doses of influenza vaccine and 10 million doses of other vaccines (DPT, BCG, TAB);
- Organization of manufacturing of glass vials and ampoules with annual production of 100 million units;
- Establishment of production of single-use tests (tests for pregnancy, alcohol, drugs, etc.) with annual production capacity of 20.0 million standard units.
- Legal framework contributing to creation of enabling environment for business and providing foreign investors with a broad package of benefits and privileges;
- Political and macroeconomic stability in the country, that guaranties the investment’s security;
- Market access to CIS whose population is over 300 million people, and also the existence of an agreement on free trade zone with Russia, Ukraine, Belarus, Kazakhstan, Georgia, Armenia, Azerbaijan, Moldova, Kyrgyzstan.
- Convenient geographical location of the country;
- Relatively cheap energy and raw materials;
- Access to the unused buildings and structures under the zero value on the condition of mandatory investment;
- Potential domestic market in Uzbekistan with a population of 29.7 million people. Annual demand – 25.0 million pairs of shoes.
- Construction of tannery (leather making factory) with annual production capacity 17 million dm2 leather;
- Establishment of production of leather clothes with annual production of 100 thousand units;
- establishment of new shoe factory with annual production capacity of 800 thousand pairs of shoes;
- Construction of leather processing complex with annual production of 155 million dm2 of leather.
- Legal framework contributing to creation of enabling environment for business and providing foreign investors with a broad package of benefits and privileges;
- Political and macroeconomic stability in the country, that guaranties the investment’s security;
- Market access to CIS whose population is over 300 million people, and also the existence of an agreement on free trade zone with russia, Ukraine, Belarus, Kazakhstan, Georgia, Armenia, Azerbaijan, Moldova, Kyrgyzstan;
- Convenient geographical location of the country;
- Relatively cheap energy;
- Access to the unused buildings and structures under the zero value on the condition of mandatory investment;
- Potential domestic market in Uzbekistan with a population of 29.7 million people;
- Raw materials based on the climatic and environmental conditions, provide a unique opportunity for fruit and vegetable processing. For instance, from vegetables and fruits processing waste (bagasse, sludge) can be organized production of different pectins, that are able to remove harmful metals (lead, cobalt, copper, mercury) from human body and are widely used not only in the food industry, but also in pharmaceutical, textile, paper, leather, perfume industry, film industry, metallurgy, agriculture and medicine.
- Construction of confectionery factory with annual capacity of 10 thousand tons;
- Construction of factory for producing fast cooking food using sublimated fruits and vegetables with annual production capacity of 1.0 thousand tons of dry food products;
- Establishment of fruit processing and production of concentrates, jams, comfitures and fillings for confectionery industry with annual production capacity of 300 tons of finished and semi-finished products;
- establishment of production of baby food (based on milk, rice, cereals, starches, fruits and other food products) with annual production capacity of 8.0 thousand tons of products.
- Manufacturing of ceramic tiles with annual production capacity of 1 million m2 at “Moderna Keramik Industries” JV in Fergana;
- production of soft roofing materials at “pentUz” Uzbek-American joint venture enterprise in Tashkent region with annual production capacity of 5 million m2 . These and other projects implementation will allow to feed domestic construction market with modern high-quality materials made from local raw materials and to increase volume of export.
- Legal framework contributing to creation of enabling environment for business and providing foreign investors with a package of benefits and privileges;
- Political and macroeconomic stability in the country, that guaranties the investment’s security;
- Market access CIS whose population is over 300 million people, and also the existence of an agreement on free trade zone with Russia, Ukraine, Belarus, Kazakhstan, Georgia, Armenia, Azerbaijan, Moldova, Kyrgyzstan;
- Potential domestic market in Uzbekistan with a population of 29.7 million people;
- More than 500 deposits for production of building materials are available in Uzbekistan, including deposits of bricks, cement, haydite raw materials, cutting stone, gypsum, limestone, facing stone and other;
- Convenient country’s geographic location;
- Relatively cheap energy;
- Access to the unused buildings and structures under the zero value on the condition of mandatory investment.
- Establishment of production of porcelain ceramics with annual capacity of 2 million m2;
- Establishment of production of sanitary ware (toilets, sinks, drain tanks and bidet) annual production of 200 thousand units of sanitary ware;
- Construction of ceramic tiles facility with annual production capacity of 4.5 million m2;
- Establishment of production of sheet glass with annual capacity of up to 20 million m2.
- Construction of new hotel complex with all necessary amenities (2390 rooms) in regions;
- Modernization of hotel buildings (1361 rooms) and new furniture procurement;
- Restaurants and other entertainment centers construction and reconstruction;
- Procurement of modern tourist buses;
- Investments attraction (over 230.0 million U.S. dollars) for tourism and its infrastructure development.
- Construction of 14 roadside campsites class “a”, “B”, “C” along national 380 highway from Tashkent to Nukus. One campsite total capacity is 50 persons. Each building will be equipped with the housing complex with the necessary furniture and utensils, single car-care center and sanitary facilities.
- Construction of “three-star” or “four-star” hotel ¦ complex in tourist centers of Uzbekistan such as Samarkand, Bukhara, Khiva and Urgench. The purpose of the project – complete construction of hotel complex building, equipping its rooms and other accommodations with furniture and utensils, bringing up to standards of “three-star” and “four-star” hotel;
- Construction of restaurants and other recreation ¦ facilities of tourist infrastructure such as parks, aqua parks in Uzbekistan. The purpose of the project – complete construction these recreation facilities of tourist infrastructure by attraction of foreign investments and state-of-the-art techniques.
- In Klaipeda (Lithuania), Riga, Liepaja, Ventspils (Latvia), Tallinn (Estonia) Baltic countries ports direction;
- In EU countries direction (in transit through Chop (Ukraine) and Brest (Belarus) border crossings);
- to Illichevsk Ukrainian port with further access to Black Sea;
- By Europe-Caucasus-asia corridor (traCeCa), passing through Turkmenistan, Kazakhstan, Azerbaijan, Georgia with access to Black Sea;
- To Bandar Abbas Iranian port (in transit through Turkmenistan) with access to Persian Gulf;
- In east direction through “Dostyk / alalshankou” Kazakh-Chinese border crossing to China eastern ports as well as through Nakhodka and Vladivostok
- Tebinbulak titanium-magnetite deposit with reserves of 3.5 billion tons of ore;
- Temirkan hematite-magnetite and magnetite deposits with reserves of 105 million tons of ore;
- Syurenatin skarn-magnetite deposit with reserves of 25.3 million tons of iron.
- The most studied manganese ore deposits are bedded deposits of Dautash, Kyzylbayrak, Takhtakaracha.
- From USD 300 thousand to USD 3 million – for 3 years;
- Over USD 3 million to USD 10 million – for 5 years;
- Over USD 10 million – for 7 years.
- Location of the said enterprises in all cities and villages of the republic of Uzbekistan, with the exception of Tashkent and Tashkent region;
- Direct private foreign investment by foreign investors without providing a guarantee of the republic of Uzbekistan;
- Share of foreign investor in the authorized capital of the enterprise should be not less than 33 per cent;
- Foreign investment made in hard currency or as up-to-date manufacturing equipment;
- Reinvestment of at least 50 percent of the proceeds generated from the preferences received during their effective term for into further development of the company.
- all kinds of taxes and mandatory contributions to extra-budgetary funds for the period of exploration works;
- customs duties (except customs clearance fees) for the import of equipment, material and technical resources and services required to carry out prospecting, exploration and other associated works.
- property imported by foreign investors and enterprises with foreign investments with the share of foreign investments in the authorized capital of at least 33%, into the republic of Uzbekistan for own manufacturing needs;
- property imported for the personal needs of foreign investors and foreign nationals residing in the republic of Uzbekistan in accordance with labor contracts, signed with foreign investors;
- goods imported by foreign legal entities, which made direct investments into economy of the republic of Uzbekistan for a total amount of over USD 50 million provided that the imported goods are their own products;
- process equipment imported to the republic of Uzbekistan in accordance with the legally approved list as well as spare parts provided that their delivery is stipulated by the terms and conditions of the process equipment delivery contract. enterprises with foreign investment, apart from the relevant tax and customs privileges and incentives, may also enjoy all kinds of tax and custom privileges stipulated for legal entities of the republic of Uzbekistan, for instance, in the production of export-oriented and import-substituting products, production of consumer goods of high demand, export of goods (works, services), import of process equipment, transfer of property as investment obligations, etc.
- payment of taxes and other mandatory payments via remote service for bank accounts, including internet banking;
- Declaration of goods by the business entities at the custom clearance of goods;
- Registration of ownership of legal entities for real estate through “one-stop shop”approach;
- Submission of claims and applications of business entities to economic courts. In accordance with the document, commercial banks are recommended to reduce, by at least 20%, the fees charged for the account management of small businesses, which make payments electronically.
- Preferential tax and customs regime.
- Simplified regime of entry and stay in Navoi Fiez.
- Modern infrastructure and business services.
- Advantages of multimodal transport and logistics hub.
- Advantageous geographic location.
- Free access to the market of CiS counties
- Production of electrical goods and telecommunication equipment;
- Production of machinery and instrument-making products and component parts for cars;
- Production of pharmaceutical products and medical equipment;
- Foodstuff processing and packaging;
- Production of plastic and polymeric goods. The body, which coordinates and regulates the activity of the Navoi Fiez., is the administrative Board. Operative management of the Navoi Fiez is carried out by the Directorate, incorporated as the State Unitary enterprise. The area of the Navoi Fiez is 564 thousand hectares. Operation period of the Navoi Fiez is 30 years but the term can be extended in future. Throughout the Fiez operation period a wide range of benefits and preferences is provided.
- From 3 to 10 million euros – for 7 years;
- From 10 to 30 million euros – for 10 years. For the following 5 years rates of income tax and unified tax payment are fixed at the level of 50 percent of current rates;
- More than 30 million euros – for 15 years. For the following 10 years rates of income tax and unified tax payment are fixed at the level of 50 percent of current rates.
- www.silkroadpalace.uz;
- www.hotel-zarafshan.com;
- www.grandm-hotel.uz.
- Financial and banking services;
- tax services and consulting;
- Customs services;
- Logistics and transportation.
- “Telecom innovations” JV established with “Servetechno pte ltd “(Singapore) and “zte” (China) for production of aDSl modems and DSlaM equipment;
- “Uzerae Cable” JV established in partnership with “erae Cs” (rOK) for production of automobile wires;
- “UzMinda” JV established in partnership with “Minda Capital ltd” (India) for production of auto parts;
- “Uzerae alternator” JV established in partnership with “erae Cs” (rOK) for production of generators and compressors for automobiles;
- “Hansang pharm” JV for production of pharmaceuticals;
- “Navoi hunan pulp” JV established in partnership with “hunan aloft imp&exp.Co.ltd” (China) for production of nappies and hygienic products for children;
- “CFM proenergies” JV established in partnership with “CFM holding” (Singapore) for production of LED lamps;
- “UzKor lighting” JV established in partnership with “Shinghwa lighting” (rOK) for production of energy-saving lamps;
- “agroFresh” JV established in partnership with “Kefayat General trading Co. llC” (Uae) for production of processed fruits and vegetables by using contemporary freezing technologies;
- “Polypropylene kuvurlar” branch establishment for production of polymers;
- “Polyethylene kuvurlar” branch establishment for production of polymers;
- “Navoi Beauty Cosmetics” JV established in partnership with “DK Cosmetics” (rOK) for production of cosmetics.
- Automobile gas cylinders within “KoUNGCylinder” JV in partnership with “KOGaS” (rOK) and “KOlON” (rOK);
- Electronic gas-meters within “Dugastech” JV;
- Fiber optics within “Navoi Optic Cable”;
- Power cables from cross-linked polyethylene within “hpC Systems” JV in partnership with “Gulf Cable trading Company” (China);
- Mobile phones, stationary wireless telephones, USB modems within “Olive telecom” JV in partnership with “Olive telecommunication” (India).
- income tax, property tax for legal entities, social infrastructure development tax, unified tax for small businesses, as well as compulsory contributions to the republican road Fund;
- customs payments (except customs clearance duties) for the equipment, components and materials that are not produced in the country, imported into the angren Siz within the implementation of the projects in line with the list approved by the Cabinet of Ministers.
- From 300 thousand to 3 million US dollars – for 3 years;
- From 3 to 10 million US dollars – for 5 years;
- More than 10 million US dollars – for 7 years.
- Creation of modern manufactures or carrying out of an extensive modernization of existing facilities, equipping them with high-tech equipment and technologies;
- compliance of the company’s profile with the main objectives of the angren Siz, without including enterprises engaged in mining and primary processing of natural raw materials;
- Investment of stakeholders’ own funds and loans taken by them without receiving a government guarantee of the republic of Uzbekistan;
- Phased establishment of manufactures with full production cycle, to produce import-substituting and export-oriented competitive products highly demand on market;
- Reinvestment into the company of at least 50 percent of the proceeds generated from the preferences received during their effective term.
- Certificate issued to the resident of the angren Siz, is the evidence of its right to exercise a special tax regime and customs preferences within the angren Siz.
- attraction of FDI in order to create and efficient work of the up-to-date high-end and innovative manufactures of high value-added goods, which are competitive in both domestic and foreign markets;
- providing of complex and efficient use of productive and resource capacity of the regions, which included to Special industrial zone, as well as creation of new manufactures, aimed at deep processing of minerals and raw materials and farm products;
- extending of processes of localization of the high-end goods manufacture by using local raw materials on the basis of partnership and development of industrial cooperation between the companies in Siz and in the country as a whole;
- providing of the priority development and efficient use of the transport, engineering-communication and social infrastructure in Jizzakh Siz. Operation period of the Jizzakh Siz is 30 years, but the term can be extended in future. Throughout this period a special tax treatment and customs benefits are effective in the territory of SIZ. The status of the Jizzakh Special industrial zone residents is granted by administrative Board of Siz.
- income tax, property tax for legal entities, social infrastructure development tax, unified tax for small businesses, as well as compulsory contributions to the republican road Fund;
- customs payments (except customs clearance duties) for the equipment, components and materials that are not produced in the country, imported into the Jizzakh Siz within the implementation of the projects in line with the list approved by the Cabinet of Ministers.
- From 300 thousand to 3 million US dollars – for 3 years;
- From 3 to 10 million US dollars – for 5 years;
- More than 10 million US dollars – for 7 years.
Petrochemical industry
Chemical Industry
The chemical industry of Uzbekistan is a basic sector, it includes enterprises producing mineral fertilizers, plant protection chemicals, chemical fibers and yarns, synthetic resins, polymer products, and other products.
This sector is represented by the State Joint Stock Company (SJSC) “Uzkimyosanoat”. It brings together 12 major industrial enterprises, 13 regional distribution organizations which sell chemical products to agricultural sector; it also includes design and scientific research institutes and a transportation company.
Currently, “Uzkimyosanoat” enterprises are producing the following products:
Current Trends in Chemical Industry
Through diversification of the production and development of foreign markets, the production of new products, such as methanol, ammonium chloride, monoammonium phosphate, and others was organized. During 2011 “Uzkimyosanoat” enterprises export constituted 110.8% compare to 2010.
Chemical products are exported to more than 30 countries. The total production volume in 2012 constituted 1560.7 billion sums (780 million USD). Production of mineral fertilizers exceeded 1.2 million tons in hundred-percent nutrients. Production of large range of chemical products, such as feed phosphates, urea-ammonium nitrate, trisodium phosphate, NpK and others has been developed. Furthermore the following joint ventures have been established on the territory of Navoi Free Industrial economic Zone:
Future Developments in Chemical Industry
The program on development of chemical industry of the republic of Uzbekistan in 2011-2015, includes 30 projects of total value of 2.8 billion U.S. dollars. Of which:
At the same time, the program for production expansion and development of new types of competitive products covers 14 projects of total value of 528.8 million U.S. dollars. Among them:
16 investment projects of total value of 767.5 million U.S. dollars are included in the address part of the Investment program of the republic of Uzbekistan. Also 10 promising investment proposals of total value of 3.97 billion U.S. dollars, which are planned to be elaborated are included in the Summary of the Investment program.
Available Industry Benefits
PROSPECTIVE INVESTMENT PROJECTS
Automobile Manufacturing and Engineering Industry
Automotive manufacturing industry of Uzbekistan is represented by the Joint Stock Company “Uzavtosanoat.” It includes 21 enterprises and organizations, including a higher education institution – a branch of the Turin Polytechnic University in Tashkent city. Agricultural engineering is represented by “Tashkent tractor plant” OJSC (“ttp” OJSC) and “Chirchiqqishloqmash” OJSC enterprises.
Current Industry Trends
Currently, “Uzavtosanoat” JSC enterprises are producing:
“Uz-SeMyung Co.” JV, “Uz-Coram” CJSC JV, “east Butterfly”JV, “Uz-Dong Yang”CJSC JV, “Avtooyna” OJSC, “UzDongDzhu paint” JV, “Zenith electronics” JV, “UzeraeKabel” LLC and “Uz-hanwa” JV;
In the field of agricultural machinery:
Future Industry Developments
Production of new modern car models that meet international safety, quality and environmental standards performance is one of the main priorities of the Uzbekistan’s automotive industry development. In order to better meet the demand for automotive products in the domestic market and to increase the country’s export potential a number of projects for the development of new cars models based on the advanced high-throughput technologies are implemented.
Available Industry Benefits
PROSPECTIVE INVESTMENT PROJECTS
Automobile manufacturing:
Agricultural machinery:
Engineering:
Electrical Industry
Electrical Industry in Uzbekistan is represented by the association “Uzeltekhsanoat” that brings together about 30 companies of various forms of ownership, including with foreign investment.
They are focused on the following areas:
Current Trends in Electrical Industry
Currently, “Uzeltexsanoat”affiliated companies, are engaged in implementation of different investment projects, that are aimed at production of new kinds of electrical products for household use. In particular, in 2011, 15 investment projects of 96.9 million U.S. dollars of total value have been implemented. Of these, 8 investment projects aimed at increasing of the production and development of new appliances. at the end of 2011 as far as above mentioned projects were implemented production of high-quality import substituting electric products of consumer goods was achieved. In particular:
Future Industry Developments
Additional activities on implementation of longterm investment projects, aimed at development of import-substituting, production of competitive electrical products in 2012-2015 and the expansion of production volumes are conducted by the association’s enterprises to advance the electrical industry through establishing new production facilities and development of new types of consumer electronic products. These projects are:
INVESTMENT PROJECTS PROSPECTIVE
Available Industry Benefits
Light Industry
Uzbekistan’s light industry is represented by State Joint Stock Company “O’zbekyengilsanoat”, which currently includes 285 enterprises. They are specialized on textile, silk, knitting industries. To date they perform yarn and cotton fabrics, knitted fabrics, knitwear and hosiery, as well as the threads of raw silk and health products production.
Current Trends in Light Industry
Currently, 75% of Uzbek textile products is produced by joint ventures and international enterprises equipped with tools from the world’s leading textile machinery companies such as “tryuchler”, “Schlafhorst”, “tsinzer” (Germany), “rieter” (Switzerland) “toyoda”, “Murata” (Japan), “Savio”, “Orizio”, “Martsoli” (Italy). Large foreign investors such as the “Daewoo International”, “Daishin textile”, “Shindong enerkom” (South Korea), “Bayteks tigaret”, “tekfen”, “Bo Group”, “alcimus textile”, “Mert iplik”(turkey),”Vayreks”, “Osborne trading”, “tagus” (Great Britain) and other are operating in the country. Until now, the industry has attracted over 1.5 billion U.S. dollars of foreign investments. More than 120 companies established together with foreign investors from Germany, Switzerland, South Korea, Japan, turkey, USA, India, etc. More than 150 projects specialized on clothing production (sportswear, clothing for adults, children’s clothes, underwear, etc.) are implemented.
Company’s enterprises goods export has increased to 600 million U.S. dollars. Cotton fiber processing by domestic consumers share has reached 40% of total production. Modern textile enterprises, including dyeing, finishing, knitting and garment manufacturing are commissioned.
Future Developments in Light Industry
The program of priority measures to improve production and development of new types of competitive products describing implementation of 21 projects in 2011-2013 was approved by the resolution of the president of the republic of Uzbekistan dated October 4, 2011, NºPP-1623. The total value of the projects is 294.2 million U.S. dollars, of which 37.9 million – own funds, 106.7 million – commercial bank loans and 149.6 million – foreign direct investment. according calculations in case of above mentioned projects successful implementation annual increase of cotton yarn production will be achieved for 49.8 thousand tons, of finished fabrics for 47 million running meters, ready knitted for 8.2 thousand tons, of finished production for 6.5 million units, hosiery for 3.6 million pairs and process equipment for 190 units. Also a program of regional projects development in 2012, providing the implementation of 82 projects for total amount of 598.2 million U.S. dollars is approved.
Available Industry Benefits
PROSPECTIVE INVESTMENT PROJECTS
Pharmaceutical Industry
Pharmaceutical Industry of Uzbekistan represented by 126 enterprises, including 22 joint ventures. They are mainly specializing on production of pharmaceuticals, medical devices, and diagnostic aids and other items. “Uzfarmsanoat” State Joint-stock Concern is the lead industrial association of pharmaceutical companies. The sector has large developed research and human capacity, supporting training of required chemist and technologists, biotechnologists, engineers, and pharmacists.
There are 8 research institutions, including:
There is Tashkent pharmaceutical Institute, which annually trains more than 200 pharmacists and industry experts.
Current Trends in Pharmaceutical Industry
70 pharmacological groups of medicines are being manufactured in Uzbekistan including cardiovascular drugs, vitamins, biostimulants, analgetics and anesthetics, antibiotics, antituberculosis drugs, antiseptics, anti-parasitic drugs, diagnostic products, vaccines, sera, bactericides, and other substances. The total number of medical drugs registered in Uzbekistan reached 5,914 items. Today the pharmaceutical market of Uzbekistan totals more than 1 bln U.S. dollars and features quite high growth rates.
Companies with foreign participation are actively working on pharmaceutical market of Uzbekistan, among them “Nobel pharmsanoat” LLC JV, “Ultra health Care” JV, “Jurabek Laboratories” LLC JV, “remedy Group” LLC JV, “Novo pharm” LLC, “hansangpharm” LLC JV, “Samsun- toshkentpharm” LLC and others. In the near future it is planned to start production of original medicals with attraction of well-known companies.
Future Developments in Pharmaceutical Industry
The development strategy of the pharmaceutical industry envisages that the following objectives are met:
Available Industry Benefits
PROSPECTIVE INVESTMENT PROJECTS
Leather and Footwear Industry
Leather and footwear industry in Uzbekistan is represented by “Uzbekcharimpoyabzali” association, which unites 53 production enterprises operating in leather processing, footwear, leather haberdashery goods and imitation leather production fields.
Current Trends in Leather and Footwear Industry
As 2012 outcomes, “Uzbekcharimpoyabzali” enterprises had 27.8 million U.S dollars export sales natural leather products. Goods are exported not only to neighboring states, but also to European countries such as Spain, Italy, and turkey and to several Asian countries like China, India, and Pakistan.
In 2012 foreign investments worth 33.8 million U.S. dollars have been attracted to leather and footwear industry of Uzbekistan.
Future Developments in Leather and Footwear Industry
In order to support development of the industry Footwear Design Center was created under “Uzcharmpoyabzali” to study footwear market trends, develop and launch production of new models at the enterprises. Furthermore the work on introduction of international standards and quality management systems in enterprises is in progress.
About 42 enterprises were included in the program approved by Cabinet of Ministers of Uzbekistan “On measures for further development and modernization of the leather and footwear industry and increase the production of finished leather goods in 2009 –2012”. More than 50 million U.S. dollars have been allotted for upgrading and establishing of new production capacities. It is expected to increase marketable products by 3 times, the footwear – 4 times, and leather goods – 12 times.
Available Industry Benefits
PROSPECTIVE INVESTMENT PROJECTS
Food Industry
Food industry in Uzbekistan is represented by the association of food industry enterprises of the country. More than 350 food manufacture companies are operated in Uzbekistan. They mainly specialized on production of confectionery, canned foods and beverages, meat and dairy products, vegetable oils, margarines and soaps, also provision of services to other companies in the industry.
Current Trends in Food Industry
Currently, large-scale modernization and technical upgrading of oil and fat, meat and dairy and foodprocessing industries, introduction of modern hightech innovations according to the international best practices are underway in food industry. The key to success was the attraction of foreign partners who have experience, design, technology and who brought investments. According to the last year results, the country’s food production has increased by 13.8% exceeding 6.6 trillion sums. Significantly increased production of margarine products – by 19.3%, bread and bakery products –45.5%, flour –19.3%, and sugar – 12.8%.
Currently, 17 joint ventures operate within association of food industry. These include, for instance the enterprises established together with world famous companies, such as “Nestle Uzbekistan” JV, “Coca-Cola Bottlers Uzbekistan” JV, “International Beverages Tashkent” LLC (“pepsi-Cola”), “British American Tobacco Uzbekistan” JV. Annual Uzbek market demand, based on the minimal medical standards of per capita consumption (6 kg per year) is about 180,000 tons of confectionery.
Annual actual level of production is 40 000 tonnes, or 18% of demand rate. The rest of the demand is met through imported products. The need of the Uzbek market, based on the minimum amount of demand is about 40 000 tons in a year (in sublimations). As imports and the range of such products coming from Korea, China, Russia, turkey increase, demand for a universal nutrition form grows as well.
Future Developments in Food Industry
Food industry of Uzbekistan is now at a new stage of its development. According to the approved programme of measures on expanding and developing the food industry for the period 2012-2015, Uzbekistan will significantly increase the production of major food products.
Overall, Uzbekistan plans to increase production of 16 ready products. According to experts, about 33 investment projects for 74.8 million U.S. dollars will be implemented in the industry in next five years. Uzbekistan plans to launch production of fast food with use of sublimated products. During this period, Uzbekistan plans to start production of fast food, using freeze-dried pieces of fruit and vegetables, confectionery plant for processing cocoa beans, production of dry baker’s yeast, iodized salt, and sugar.
Also Uzbekistan plans to construct 44 milk processing enterprises, reconstruction, modernization and construction of 90 meat-processing industries, as well as reconstruct and modernize 26 plants and construct 78 plants on processing fruits and vegetables with total capacity of 40,700 tones.
Available Industry Benefits
PROSPECTIVE INVESTMENT PROJECTS
Building Materials Industry
Building materials industry is represented by “Uzstroymateriali” Joint Stock Company, which brings together more than 110 enterprises (except for branches and subsidiary enterprises).
they produce construction-related products, such as cement, slate, asbestos-cement pipes, concrete mixtures and mortars, lime, reinforced concrete and structures, gypsum, mineral-cotton products, “Skorlupa” pipes heat insulating sheath, BIKROM, dry mix – POLIIZOL, glassware, expanded polystyrene heat insulated facade elements, chipboard, sandwich panels, marble, granite and other natural stones, bricks, electrodes, and nails.
Current Trends in Building Materials Industry
120 investment projects were implemented in building materials sector during 2005-2010. It is necessary to note that the volume and range of building materials has increased through rational placement of production facilities and introduction of modern technologies.
Leading international manufacturers such as “Knauf”, “Keda”, “FLSmidth”, “ttIOt”, “Christian pffeifer Maschinenfabric Gmbh”, “Mollers”, “Sacmi”, “CaK” and others are contributing to investment projects implementation in Uzbekistan.
Modern gypsum-making plant using German company’s “Knauf” technology with annual capacity of 20 million m2 was built at “Knauf Gips Bukhara” LLC JV in 2011. In 2009-2011, bricks production capacity has increased by 844 million pieces across the regions of Uzbekistan.
Over the past ten years the annual cement production doubled – from 3.2 to 6.8 million tons, mainly thanks to modernization and reconstruction of major industrial enterprises as “akhangarancement” OJSC, “Bekabadcement” OJSC, “Kyzylkumcement” OJSC and “Kuvasaycement” OJSC. In 2008-2011 the enterprises reached 100% capacity utilization.
Future Developments in Building Materials Industry
The main priorities of building materials industry are diversification of production, expansion of assortment of building materials, export promotion and developing local market of construction materials with innovative characteristics.
Currently, “Bekabadcement” OJSC continues to upgrade existing production facilities including construction of the new line (dry method) for production of 850 thousand tons of cement clinker a year. Commissioning of the project will increase annual cement production by one million tons and create more than 100 new jobs. In 2012-2014 almalyk Mining-Metallurgical Complex and “Uzstroymateriali” JSC are planning to build a cement plant of 600 thousand tons capacity. The project with estimated value of 80 million U.S. dollars also includes production of 100,000 tons of white cement.
Within investment program for 2012 it expected to implement seven investment projects, including:
Available Industry Benefits
PROSPECTIVE INVESTMENT PROJECTS
Tourism
Tourism in Uzbekistan is a national priority for sustainable development. Country has great potential for increasing export of tourism services.
Current Trends in Tourism Industry
More than 1 million of tourists, including 463,400 international tourists, which is 5.4% more compared with 2010, have been served by Uzbek tourism sector in 2011.
“Uzbektourism” NC board has summarized tourism sector development results for first half of 2012, and according to its figures during this period, total number of tourists has increased by 12.8% compared to the same period of 2011, foreign tourists services – by 4.1%, domestic tourism – by 20.7%, tourist services volume – by 59.8%. Tourism services exports reached 74.0 million U.S. dollars with a growth rate 131.8% compare to corresponding period of 2011. Today more than 1006 organizations are involved in tourism sector of Uzbekistan, including 506 tour operators and 500 hotels. Special attention is given to expansion of cooperation with foreign partners in development of domestic tourism industry. A number of marketing project as Mega-info-tours have been organized by “Uzbektourism” to widely present our country’s tourism potential and to increase number of tourists visiting Uzbekistan. Close cooperation ties with more than 200 travel agencies from different countries, such as Great Britain, Hungary, Italy, Spain, the Netherlands, Russia, Singapore, France, China and Japan are established.
Future Developments in Tourism Sector
Currently, in accordance with program of targeted measures on tourism development and tourism services export potential increase in the regions in 2011-2012, works on route, infrastructure development, project documentation preparation, land allocation, hotels construction completion and other measures for region’s tourism potential development are carried out by responsible local authorities. Within their frameworks the following is planned:
Moreover, it’s planned to expand scope of work to make advertising shots to show the country’s cultural and historical heritage and tourism potential. In particular, leading TV channels and television companies around the world are planned to be engaged to this project within cooperation agreements with foreign mass media. Videos prepared with their assistance will be shown to international audiences. Efforts are taken to promote the country’s tourist potential; this includes include necessary information on camp sites, recreation areas, resorts, sanatorium-resort, therapeutic, sport and health, recreation and ecotourism organizations and institutions activities in the regions.
Today the country’s most prospective tourism areas are as follows:
Sports tourism. Uzbek mountains are attractive to those who love active recreations such as mountain climbing, mountaineering and rock climbing fans. Chimgan mountains with Bolshoy
(Big) Chimgan peak, which is nearly 3309 m high is the country’s most popular mountain area. This area is the beginning of many alpine trails, hiking trails, rock climbing, horse riding trails, ski slopes. Popular rafting river route is Chatkal river that is flowing into Charvak water storage basin and has several difficulty categories rifts. Baysuntau range with Boy-Bullock deep caves (amplitude of 1415 m), Festival-Ledopadnaya (-580 m), Urals (-565 m), Kiev Cave (-990 m) at Kyrktau plateau; Zaydman cave (-506 m) in Chatkal range and others are of cavers interest.
Winter tourism. It should be emphasized that climate in Uzbek mountains, is distinguished by “warm”, but rather sharp continental, which is an important detail for skiing fans, as slope is “holding ski” here and you don’t need to sharpen skis edges. If it is getting too frosty in the night, then, anyway, the flank will get “loosen” in the morning. In general, temperatures below 20 degrees are rare here. Winter recreations in Uzbek mountains take place in Chimgan and Beldersay. Several modern hotel-like recreational centers, hotels and hostels are located here.
Scientific tourism. Annual migration of more than 400 species of birds allows to arrange scientific excursions for local and foreign ornithologists in “aydarkul” lake that in Farish district in Jizzakh region. Moreover it is a great opportunity to conduct “avicenna” festival, which includes medicinal plants and folk remedies exhibition, unconventional treatment methods presentation, master classes on medicinal products preparation from natural plants, as well as “ancient Khorezm culture” festival in which national games, “Lazgi” dance of 17 kinds, population historical and cultural life scenarios performances are carried out. Ecotourism. Attractive for ecotourism fans unique nature, landscapes (steppes, deserts, mountains, and plateaus), various rare flora and fauna species, globally significant archaeological, paleontological remains, rare geological deposits, numerous nature monuments are existing in Uzbekistan.
The country’s fauna is represented by 97 herbivore species, 424 bird species, 58 reptile species and 83 fish species. 24 herbivore species, 48 bird species, 10 reptile species, 18 fish species and 78 invertebrate species of them are included to the “red Book of the republic of Uzbekistan”. As for the flora, according to the Institute of Botany of the academy of Sciences of the republic of Uzbekistan, country has more than 4,100 species of plants today. Of these more over 3,000 are top wilding, and 9% endemic plants.
One of the factors of environmental stability in Uzbekistan are the ecosystems which did not experience strong man made impact and preserved self-recovery ability. Protected areas system in Uzbekistan covers 5.57% of country and includes 9 state preserve parks, 2 national parks, 9 nature reserves and 2 state natural monuments.
Republic of Karakalpakstan, whose central part is located in the Amu Darya River’s delta is of special interest for ecotourism. Adjacent to it Kyzyl Kum desert in the east, Ustyurt plateau in the west and Aral Sea residuals in the north are forming a truly unique landscape.
Available Industry Benefits
Favorable climatic conditions.
Uzbekistan, being a warm and sunny country, has unique climatic conditions, compared to other Central Asia countries. average annual temperature in Tashkent is 5-8 degrees higher than in Almaty (located 808 km north-east of Tashkent) in Kazakhstan and 8-10 degrees lower than in the Ashgabat (located 1294 km to the south -west of Tashkent) in Turkmenistan. Temperate climate and the availability of water resources are contributing to Uzbek land fertility.
For instance, Tien Shan and Pamir mountain ranges that are barren steppe and deserts are alternated with oases, where cotton, figs, rice and grape are cultivated. Green plains are surrounded by mountain ranges, covered with eternal snow. Many streams and rivers are flowing down from mountains, merging into Amu Darya and Syr Darya major rivers in Central Asia.
Kyzyl Kum desert fauna includes many rare wildlife species. In turn, Kyzylkum reserve, located in amudarya riperien forests is an attractive natural park with many valuable species. “Djeyran” ecocenter, located 40 km south to Bukhara is of no little interest. Here experts are engaged in endangered and rare animal species rehabilitation. Aydar lake picturesque lakesides and other water bodies are traditionally comfortable places for recreational fishing. In addition, tourists can ride on camels and engage in other romantic activities, that creates nomads life representation.
Uzbek people hospitality. Uzbek people always welcome guests with warmth and cordiality. Since ancient times country was considered as a bridge between countries and nations, a crossroad for ancient caravan routes as well as a meeting place of languages, cultures and civilizations.
Unique sights.
Uzbekistan is a country of greatest cities, where you can see hundreds ancient and unique architectural monuments created in various periods. Many cities such as Bukhara, Tashkent, Samarkand, Shahrisabz, Karshi, Khiva, termez and Kokand have centuries and millenniums history. they lived and worked in the Greatest east thinkers and masters, invaluably contributed to culture, art and science development each in his time lived and worked in that cities.
These cities were part of powerful states, as well as most important points for caravan trade along the Silk Road in ancient times. More than 4000 architectural and archeological monuments are located in the country and four of them are inscribed to UNESCO World Cultural heritage list.
PROSPECTIVE INVESTMENT PROJECTS
Transport and Communications
Transport and communication system development, of course, is one of important factors to advance country’s international business. In this regard, transport and communication sector and foreign trade cargo routes diversification are of primary importance for Uzbekistan which is a land lock country.
For several years, integration into global transportation links, effective international routes for foreign trade and transit goods transportation development, transport system modernization, logistics centers network formation and transit capacity increase are remaining the main areas for the country’s transport strategy.
Currently, a targeted policy to further improve and increase the transportation capacities is implemented in Uzbekistan. New railways and highways construction running in the country, main transit rail lines and international importance roads are being rehabilitated, the international airports is being modernized, specialized international transport terminals are being built, appropriate legal and regulatory framework is being developed. Railway transport. Uzbek railways, whose international goods transportation share is 93% are playing special role in transport sector in Uzbekistan.
As 2011 outcomes, rail freight traffic total volume was 59.6 million tons. Over 13.587 million tons of export and import goods have been transported, that about 23% of foreign trade freight. 9.683 million tons of goods have been transported by republic’s rail communications transit.
In 2011, 23.2 million tons of international cargo was transported through republic’s railway, 41.6% of which is transit cargo, 37.5% – import and 20.9% and export goods. Total developed railways length is 6 479.65 km, including operational length of 229.7 km, station tracks of 1 883.05 km.
Railways average density in Uzbekistan is 13.5 km per 1000 sq. km. of country’s area. In the total cargo turnover by all types of transport modes the share of rail transport reaches 53.0% (excluding pipelines), and in passenger traffic – 3.8%. Uzbekistan is a member-state to more than 44 international conventions, treaties and agreements in railway transport and transit field. National Integrated railways network had been built over past 20 years. For instance, “Navoi – Uchkuduk – Nukus”, “tashguzar – Boysun – Kumkurgan” new lines are commissioned, thereby integrated transport network with country’s northern and southern regions was created, also this allowed to begin development of new mineral deposits and industrial enterprises as well as to create additional jobs and to provide direct access to other countries.
For the period 2000-2010, “tukimachi – angren” line have been electrified, combined rail-road bridge across amu Darya river have been built, rail line rehabilitation have been undertaken at the area of “Tashkent – Samarkand – Bukhara” track section, fiber-optic communication lines continue down to over 600 km construction have been finished at “Keles – Bukhara” track section.
During the past period railways rolling equipment is significantly updated. For instance, high-speed and highly comfortable trains “registan”, “Nasaf”, “Shark”, linking Tashkent with Samarkand, Karshi and Bukhara are started running. High-speed “talgo-250” trains, bought in Spain, are started running between Tashkent and Samarkand from 2011. Currently, its planned to procure new hybrid train running on electric and diesel traction and produced by “talgo” Spanish company to be used at “Marokand – Karshi” route.
Road transport. Road transport is a key element in the country’s transport system and uniting economy’s sectors, connecting country’s major industrial centers and providing connection between country’s cities, regions and rural areas, it plays major role for economic growth and social development. Its share in international cargo transportation is run up to 4.8%. The roads total length in Uzbekistan is over 180 thousand kilometers including 3.2 thousand kilometers of international importance roads. In terms of competitiveness road transport has a number of advantages over other transport types, for instance, by high flexibility and mobility. Road transport in republic includes public transport vehicles, governmental cars and privet cars. Currently, 3 million tons of economic cargoes and about 16 million passengers are transported by public transport daily.
Significant progress in further road transportations development can be achieved through large distribution hubs high-quality operation, through services quality improvement, as well as transportation cost cargo transshipment decrease. Increasing competition among transportation organizations is an additional motivating factor.
Uzbekistan has acceded to 9 international conventions and 2 international agreements, in addition, has signed 27 intergovernmental and 1 interdepartmental agreements in international road transportation field. The country has 36 transit routes for foreign vehicles. Number of routes will increase by 8, which will run to Central Asian countries and Afghanistan borders after Kungrad – Beineu motorway completion. Air transport. Air transport share in international cargo transportation is 2.13%. “Uzbekistan airways” NaC is a national air carrier and is a backbone of the country’s civil aviation infrastructure. The airline company comprise the air carrier, airports, air repair facility, air traffic control facilities, agricultural and special aviation, etc.
Considering the passenger traffic volume, “Uzbekistan airways” NaC, among CIS countries airlines, is second only to Russia and Ukraine total air transportations.
Currently, “Uzbekistan Airways” NAC aircraft fleet has long and medium-haul and regional passenger aircrafts, such as “Boeing 767”, “airbus a-320”, “Boeing-757” and “IL-114”. Airline has also “IL-76” and “airbus a-300-600F” cargo aircraft. Country has a program on aircraft fleet renovation and unification in 2010-2016. Thus, it’s planned to purchase two modern passenger aircrafts “Boeing 787 Dreamliner” in 2014-2016. “Uzbekistan airways” NaC has 11 airports located in national regional centers, 7 of which have international status.
Transport Corridors
Uzbekistan has signed about 50 agreements and conventions relating to international transport in order to adopt international legal framework. Currently, Uzbek foreign trade cargo transportations are carried out along the following major transportation corridors:
Far eastern ports.
With settlement the situation in Afghanistan new prospects on development of alternative southern corridors to Iranian and Pakistani ports Bandar Abbas, Chahbahar (Iran), Gwadar and Karachi (Pakistan) through Afghanistan are revealed.
tejen-Sarahs-Mashhad railway with 320 km length (with wheel sets change from 1520 mm to 1435 mm gauge at Sarahs station) operation start in May 12, 1996 under Uzbekistan active participation became significant achievement in international transport corridor development, that opened new trans-Asian corridor for Central asia countries to enter world market through Iran and turkey.
In September of 1998 “traCeCa – historical Silk road restoration” International conference has been carried out in Baku by Azerbaijan, Georgia and Uzbekistan initiative as well as with European Union support. this conference important outcome was signing, by 12 countries, including Uzbekistan, “Multilateral agreement on Development of Europe- Caucasus-asia International transport Corridor” as well as agreement on International rail transport, International road transport, International trade shipping, customs and Documentation procedures technical annexes.
Transport corridor “Europe-Caucasus-asia” (traCeCa) is a network of land and sea routes, which are running from the Black Sea to Europe through Caucasus and Caspian Sea to Central Asian republics. Considering traCeCa route in the context of trade development between Europe and asia, and location of major producers in asia and consumers in Europe on the one hand, and cargo traffics possible origin from large countries-cargo owners, on the other hand, it’s can be concluded that goods delivery to Europe using transport traCeCa corridor is very attractive. Distance in main transoceanic direction from Yokohama to the largest western European ports (Rotterdam, Hamburg, Antwerp, etc.) is more than 2 times longer than by traCeCa route. June 18, 2003 in Tehran (Iran), the leaders of republic of Uzbekistan, Islamic republic of Afghanistan and Islamic republic of Iran has signed “agreement on building international trans-afghan transport corridor”, which reduces republic’s foreign goods transportation distance to the Iran ports to 1500 km.
With its entry into force in March 2011, “agreement between Pakistan and Uzbekistan on cooperation in goods transportation and transit field “and in case of Afghanistan’s situation stabilization, new opportunities emerge to use afghan territory for the transit of Uzbek goods , which positively contributes to foreign trade cargo routes diversification in Iranian and Pakistani ports direction. 75 km length “Hayraton –Mazari-Sharif”first railway that was put into operation in November 2010 in Afghanistan has landmark value for whole Central Asian region. This project was implemented by State Joint-Stock railway Company “Uzbekistan railways” with aDB support.
April 25, 2011 “agreement on the use of wagons between Uzbekistan and turkey railway authorities” came into force; this makes cargo transportation on railway to turkey more attractive.
Rapid completion of “Baku – Tbilisi – akhalkalaki – Kars” railway route construction and the application of a through tariff will allow to use this route to access Southern and Central Europe markets, and through Mediterranean Mersin port to the Middle East.
In order to promote international trade and largescale cooperation between regions, Uzbekistan initiated signing intergovernmental agreement on the establishment of a new transport corridor “Uzbekistan – Turkmenistan – Iran – Oman – Qatar”, on April 25, 2011 in Ashgabat.
Investment Attractiveness
Political and Economic Stability
Uzbekistan, first of all, is a political stability, as well as confidence for tomorrow and consistency of reforms in all areas of public and political life. It is a state, where representatives of more than hundred ethnic groups and dozens of religious creeds live in peace and harmony.
The strategy adopted by the Republic of Uzbekistan to fight against the crisis and eliminate its negative effects allowed the country, among the few other states, to provide the stable economic growth.
As expected, the actual GDP growth in 2012 was 8.2%. This rate makes Uzbekistan a fastest growing economy in the world. In 2012 the consistently high growth rates were in industrial production (7.7%), agricultural production (7%), construction works (11.5%), retail trade volume (13.9%) and paid services for the population (14.2%).
The state budget is executed with a surplus of 0.4% to GDP. The inflation rate did not exceed 7%. The economic growth was accompanied by further strengthening of the macroeconomic stability, characterized by low inflation, state budget surplus and a positive trade balance of the country (more than 1.6 billion U.S. dollars in ten months of 2012). Against the background of the continuing problems of the growing national debt in many countries, suspended policy of external borrowing, pursued in Uzbekistan enables to hold a relatively low level of external debt and steadily maintain the established image of the country, which meets its obligations in full.
Thus, as of January 1, 2013 the total amount of external debt of Uzbekistan does not exceed 16.0% of GDP that according to international criterion is classified as “less than moderate” debt.
Financial and banking system is also operated stably and safely and continues to show high indicators. In 2012, the total capital of the banking system increased by 24.3%, and for the last three years –2 times. Now, the capital adequacy ratio makes up 24.0% that 3 times more than the accepted international standards. The liquidity of the banking system on the outcomes of 2012 exceeds 65.0 percent that over 2 times more than required minimum.
If in 2010 only 13 commercial banks of the country have the positive international ratings, now their number has reached 28. Substantially increased export (by 11.6 percent) and significant positive trade balance was secured. The share of manufactured goods in the structure of nonbasic goods exceeded 70%. The key source of sustained high growth rates of the economy was increasing amount of investment in fixed capital, which made up 22.9% of GDP in 2012.
There have been attracted domestic and foreign investments in the equivalent of 11.7 billion USD, or with increase by 14 % as against previous year. At that more than 22% of all investments or more than 3.4 billion USD were foreign investments, over 79% of which foreign direct investments.
In 2012 about 74% of all investments have been focused on industrial construction, particularly on implementing of programs and projects, aimed at modernize and upgrade of works. Thus, construction of 205 major facilities with developed capital investment, worth over 1.6 billion USD was completed.
Investor-friendly Environment
During the years of Independence, the Republic of Uzbekistan has formed a favorable investment environment, broad system of legal guarantees and privileges for foreign investors, developed integral system of measures on encouragement of activity of the enterprises with foreign investments. The investment legislation of the Republic of Uzbekistan is one of advanced amongst legislations of the CIS countries; it comprise major provisions of the international investment law, in particular, regulations on guarantees of the rights of foreign investors, certain preferences for investors and others.
The following laws form the basis of regulatory framework of foreign investments in the Republic of Uzbekistan:
Law: “On Foreign Investments”;
Law “On Investment Activities”;
Law “On Guarantees and Measures of Protection of Rights of Foreign Investors”, as well as several legal acts adopted in the form of resolutions of the President of the Republic of Uzbekistan and government regulations.
The Republic of Uzbekistan has no restrictions with regard to the form of investments. Foreign investors are entitled to establish enterprises within the country in any legal form permitted by the legislation.
Government measures on the improvement of the investment environment increased the volume of foreign direct investments, attracted to the country’s economy.
It should be noted that the President of the Republic of Uzbekistan issued a decree to further improve business environment and create favorable conditions for business activity « On measures on radical reduction of statistics, tax, financial reporting, of licensable businesses as well as permit issues procedures» on July 16, 2012. This document provides a number of preferences, in particular, the reduction of several statistical, financial, tax and other reporting, the frequency of its submission, and removal of 80 licensing procedures and licensing of 15 types of business activity.
Favorable Geographical Location
Uzbekistan is at the crossroads of Central Asia; this creates favorable conditions for the development of regional cooperation, participation in regional and transnational projects of transport corridors development. It is a free trade zone with CIS countries.
Proximity to the vast trade markets and developed transportation infrastructure of Uzbekistan, integrated into the multimodal Eurasia communication system, also designate the prospects of investment, trade and economic cooperation. Investing in Uzbekistan, foreign companies are able to enter the five largest and fastest growing markets: CIS (with a market of over 300 million people), Central and Eastern Europe, South and South-East Asia, Middle East.
The developed multimodal network significantly saves time and costs of delivery from Uzbekistan and as transit through the territory of our country.
The favorable geographical location of the country at the crossroads of all trade routes between abovementioned regions, developed multimodal network, covering markets, located far from Central Asia, including eastern part of the Middle East, Northern India and Western China, are an important competitive advantage, which can significantly save time and costs of delivery from Uzbekistan and as transit through the territory of our country.
As noted above, today the Republic of Uzbekistan has all conditions for the further development and improvement of the transit capacity. The country builds new railways and highways, reconstructs main transit railways and highways of international importance, updates international airports, creates specialized international transport terminals and develops appropriate legal regulations.
In addition, agreements on the establishment of the most-favored trading concluded with 45 countries, such as Japan, China, Korea, USA, the EU countries, and the Free trade zone, established within the CIS, significantly improve the competitiveness of products, made in Uzbekistan, in foreign markets. At the same time agreements on mutual protection of investments are signed with 51 countries, such as Japan, Korea, Germany, France and others.
Energy Independence
The most important benefit of the country is that Uzbekistan is one of the few countries, which is completely independent in energy supply. The Republic of Uzbekistan is among the top ten countries by oil and gas, coal and uranium deposits and is a net exporter thereof. Aggregate energy reserves in Uzbekistan are sufficient to meet the country’s needs for many years. Electricity, produced in the country, fully meets the growing needs of the country and its cost is 4 times lower than the average price paid by the industrial consumers in developed countries. The cost of one kilowatt of electricity is about four cents. In addition, one ton of coal in the domestic market costs about 20 US dollars and 1,000 m3 of natural gas to wholesale customers cost 55 US dollars.
Rich Mineral Resources
Access to a wide range of raw materials optimizes the product prime cost by significant reduction of the transporting costs of raw materials, and provides an opportunity of advanced processing and the production of goods with high added value and localization level of over 30%.
Currently, 1644 deposits are explored on the territory of Uzbekistan, including 240 hydrocarbon deposits, 119 metal deposits, 3 coal deposits, 32 deposits of metal mining raw, 26 deposits of chemical mining raw and 30 deposits of semiprecious raw, 612 deposits of building materials for various purposes and 582 deposits of fresh and mineral underground waters.
The Republic of Uzbekistan is among the top five countries of the world by the confirmed gold reserves and among the top ten countries of the world by gold mining. Uzbekistan is among the top ten countries of the world by uranium reserves and mining.
Major gold mining bases are deposits of Kyzylkum, Samarkand and Near Tashkent mining areas.
The largest iron ore deposits are the following:
Currently, 703 of non-metallic raw material deposits are recorded in Uzbekistan, 372 of them are not developed yet.
Their time will come Construction materials. The country has about 600 explored deposits of brick, cement, expanded clay, sawed stone, gypsum, limestone, building and facing stones, which are the basis for the production of various types of cement, light and heavy concrete, heat-insulating, binding and roofing materials, as well as ceramics, glass and asbestos cement pipes. Marble, granite, gabbro are very popular decorative facing stones and are famous for their beauty and durability. Hydromineral raw materials. Underground waters constitute a significant part of the country’s water resources and their importance in drinking water and agricultural water supply is hard to overestimate. Highest-quality fresh waters run in highly-permeable quaternary sediments of river valleys of Akhangaran, Chirchik, and Zarafshan, in the Fergana Valley and in the Kitab-Shakhrisabz depression.
Oil shales. Forecast studies of shale accumulation within the Syr Darya and Amu Darya rivers, including the areas of Tajikistan, Turkmenistan and Kazakhstan indicate significant resources, previously valued at 93 billion tons with 47 billion tons located in Uzbekistan. Currently, Boysun, Jam, Urtabulak, Sangruntau, Aktau, Uchkyr and Kulbeshkak outcrops are explored and studied in southern and western parts of the country. The main raw material bases of rare metals are the outcrops of Sulatsay, Mangit, Gatcha, Nauka, and Bayankara. Explored concentrations of tantalum, niobium, beryllium, rubidium, cesium and lithium require further investigation to assess their industrial importance.
Intellectual Potential
The key factor of investment attractiveness of Uzbekistan is availability of highly qualified human resources and education system that meets international standards. Currently, the country has 65 higher education institutions where more than 300 thousand students are studying in 611 different fields. Including branches of leading international universities such as Westminster International University in Tashkent (since 2002), branches of the Russian Economic University after G.V. Plekhanov (since 1995), Moscow State University named after M.V. Lomonosov (since 2006), Russian State University of Oil and Gas named after I.M. Gubkin (since 2008), Singapore Institute of Management (since 2007), Turin Polytechnic University (since 2009) and the University of Nagoya, Japan (since 2010).
Best Place to Live
Uzbekistan is a great climate, natural scenery, hospitality, multinational culture, infrastructure for tourism and recreation (hotels, world-class airports). It is a country where the quality of life is provided by the minimum cost of living.
Uzbekistan has a great potential in the tourism sphere and can surprise and delight its guests. The Great Silk Road left rich heritage in this country. Uzbekistan is famous for its unique ancient architectural monuments concentrated in the historic cities of Samarkand, Khiva, Bukhara, Shakhrisabz and Tashkent, richness and diversity of nature, ancient traditions of craftsmanship, wise customs and traditions as well as holidays of the people. Guests of the country have an opportunity to explore the homeland of the prominent statesman and General Amir Temur, the country, glorified by the famous poet and statesman Zakhiriddin Mukhammad Babur, walk on a flourishing oasis in the desert and great spaces of the Golden Valley, see the ever-burning light of ancient castles, and more. In turn, it will allow guests to feel the identity of every corner of our country, and see the single beautiful image of this ancient and modern country, and assess its contribution to the world civilization. Certainly, it is hardly possible to imagine a trip to Uzbekistan without exploration of the local cuisine, which will undoubtedly leave unforgettable impressions to the guests of the country.
Modern hotels and tourist agencies provide high quality services, which meet the international standards. Moreover, recreational centers of the country can receive visitors year-round. Uzbekistan offers a wide range of services both for fans of cultural and adventure tourism, and for extreme seekers. Today, Uzbekistan develops business, ecological, mountain, health, folklore ethnographic, historical, architectural, and religious and other types of tourism.
New Legislative Acts on Investments and Trade
On April 10, 2012 the president of Uzbekistan issued a decree “On additional measures to stimulate foreign direct investment.” in accordance with this decree, the newly established enterprises with foreign investment, where contribution of foreign investors is an equivalent to at least USD 5 million, where modification are made to the tax laws, have the right, within 10 years from the date of official registration, to apply those rules and regulations to pay corporate income tax, value added tax (turnover on the sale of goods, works and services), property tax, tax on the improvement and development of social infrastructure, unified social tax, single tax, as well as mandatory contributions to the republican road Fund and the Fund for the reconstruction, refurbishment and equipping of educational and medical institutions that were in force on the date of registration.
Within investment projects worth more than USD 50 million and where the share of foreign investors of at least 50%, construction of the necessary external, outside the production site, engineering and communication networks is financed from the national budget and other domestic sources of financing. enterprises attracting direct private foreign investment and specializing in production of radio electronic devices and production of computers’ components, light industry, silk industry, industry of building materials, industrial production of poultry meat and eggs, food industry, meat and milk industry, processing and preserving of fish and fish products, chemical and petrochemical industry, medical industry and production of medicals for veterinary use, production of packaging materials, construction of power plants based on alternative sources of energy, coal industry, production of electrical ferroalloys and hardware for production purposes, machinery and metalworking, machine tool and instrument industry, glass and porcelain industry, microbiological industry, toy industry are exempted from payment of profit tax imposed on legal entities, property tax, tax imposed on improvement and development of social infrastructure, unified tax payment imposed on micro companies and small enterprises, as well as from mandatory contributions to the republic road Fund.
Abovementioned tax privileges are granted when the volume of direct foreign investment is as follows:
Abovementioned tax-related privileges apply in the following cases:
When selling state property to foreign investors to set up an enterprises with foreign investments, the right is provided to sell low liquidity assets that belong to the local government at zero redemption cost, without bidding but through direct contracts with the investor under specific investment obligations. Per the request of the ministries, departments, business associations the right is granted to issue 12 months entry and multiple visas to the managers and professionals of foreign companies involved in the implementation of investment projects.
Enterprises with foreign investment, that are specialized in consumer goods production, where the share of foreign capital of over 50 percent are exempted from the mandatory sale of proceeds in foreign currency for 5 years from the date of registration thereof. These enterprises shall be deemed to be specialized in the production of consumer goods, when the share of domestic production of these products is more than 60 percent of total revenues from business activities.
Foreign companies engaged in the prospecting and exploration of oil and gas, as well as foreign contractors and subcontractors, recruited by them are exempted from the payment of:
Oil and gas production JV with foreign companies that carried out prospecting and exploration of oil and gas, are exempted from income tax for the period of 7 years from the beginning of oil or gas.
The following is exempted from custom duties:
*** On July 18, 2012 the president of the republic of Uzbekistan issued a decree “On measures on further radical improvement of business environment and providing more freedom to entrepreneurship”.
The document is aimed at radical improvement of business environment, creation of more favorable conditions for business, reduction, simplification and improvement of the transparency of all procedures related to the enterprises operations, introduction of internationally accepted system of evaluation criteria of the business environment and further improvement of international rating of business and investment climate of the country.
In accordance with the Decree of January 1, 2013, Uzbekistan shall establish procedures, where the business entities have right, at their own discretion, to carry out, electronically, following operations for the relevant state administration and economic governance bodies:
*** On July 16, 2012 the president of the republic of Uzbekistan issued a decree “On measures on radical reduction of d statistics, tax, financial reporting, of licensable businesses as well as and permit issues procedures”.
The purpose of this document is to significant radically improve business environment, creation of the most favorable conditions for business activity by eliminating bureaucratic barrier, reduction and simplification of the licensing procedures, radical improvement of the reporting system and the submission procedures in accordance with the requirements of the market economy and international standards.
In accordance with the Decree, 80 licensing procedures (26% of the total number) and 15 licensable activities (20%) will be abolished in Uzbekistan since august 1, including through their cancellation and integration.
In addition, licenses for a number of activities will be granted for the unlimited term since august 2012, including that previously issued licenses for these activities will also be considered as unlimited.
The Decree prohibits denial of to issue licenses and permits for new reasons in the case the business entities re-submit applications with the removal where previously found error have been eliminated. Moreover, in accordance with this document a monthly tax report for all types of taxes and other mandatory payments will be cancelled from January 1, 2013, except for the tax on profit.
From 2013 micro companies will annually present statistical reports quarterly sample surveys conducted by statistical agencies in the relevant areas and fields.
Special Industrial Zones and Logistic Centers
Navoi Free Industrial Economic Zone
Why to invest in Navoi FIEZ?
On December 2, 2008 in accordance with Decree of the president of the republic of Uzbekistan the Navoi Free industrial economic zone (Navoi Fiez) has been established on the territory of one of the most developed industrial centers of Uzbekistan, in Navoi region. Offering foreign investors a wide range of opportunities for doing business and initially endowing them with important competitive advantages, the Navoi Fiez provides all the necessary conditions for establishment of industrial complexes with full production cycle from raw materials to manufacturing finished goods.
Types of activities
The priority is given to establishment of a wide range of facilities for manufacturing of high-tech and globally competitive products by introduction of modern high-performance equipment and machinery, manufacturing lines and modules as well as innovative technologies in the following industries and sectors:
Special Tax Regime
Enterprises in the Navoi Fiez are exempted from the land tax, property tax, income tax, social infrastructure development tax, unified tax payment (for small enterprises), as well as compulsory contributions to the republican road Fund and off-budget republican School Fund.
These tax preferences are available depending on the volume of foreign direct investments:
Uzbek tax law provisions that disadvantage taxpayers, shall not be applied to business entities registered in the Navoi Fiez, with the exception of acts regulating the taxation of excisable goods.
Special Customs Regime
Enterprises, registered in the Navoi Fiez, are exempted from customs payments for imported equipment, as well as for raw materials, materials and component parts for the production of exportable goods for the entire period of operation of the free industrial economic zone.
Equipment, raw materials, materials and component parts for the production of exportable goods, being imported into the territory of Navoi Fiez by the residents of the free industrial economic zone, regardless of the country of origin shall be registered in the customs regime of free customs zone.
In addition, customs payments (excluding customs clearance duties) and measures of economic policy shall not apply to the goods imported for production needs.
Special Currency Regime
Business entities registered in the Navoi Fiez are permitted to exercise payments in foreign currencies within the Fiez in accordance with the agreements and contracts concluded between them, as well as to pay in hard currency for the supply of goods, works and services, performed by other business entities – residents of the republic of Uzbekistan.
Visa regime. Individuals involved into the business and members of their families, foreign citizens and stateless persons, recruited for work within the Navoi Fiez, shall enjoy the simplified regime of entrance, departure, stay and employment. The issuance and extension of validity of visa documents, temporary registration in the Republic of Uzbekistan, as well as permission to recruit foreign workforce and work permit to the participants of the Navoi Fiez shall be undertaken without any state duties and other payments. Entrance visas for foreign citizens, recruited for work within the Navoi Fiez, are issued based on the written request of the Directorate of the Navoi Fiez to be submitted to the Ministry of Foreign affairs of the republic of Uzbekistan and to be considered during the established period, but not more than two business days from the date of its submission. If the republic of Uzbekistan provides different, more favorable regime of visas execution for citizens of certain countries, than the one stipulated by these regulations, the more favorable regime shall be applied.
Infrastructure and Business Services
Offices. Offices meet today’s requirements, with a wide working space and high level of convenience. Offices pre-fitted with all utilities such as water, electricity, air – conditioning, telecommunications and the internet. According to demands of customers the possibility of flexible planning is also foreseen.
Land. In compliance with client’s request, ready infrastructure plots are granted for rent. These are completed sites with all necessary infrastructures of various sizes where manufacturing facilities, warehouses and offices can be constructed. Residence. Employees of the companies operating in the Navoi Fiez have an opportunity to live in a special residential complex hanjin Navoi (www hjnavoicomplex.com). The close proximity and all the necessary facilities, including a business and fitness center, swimming pool, sauna, restaurant and bar provide the perfect accommodation for you and your employees.
Also, your employees can benefit from the hotels in the immediate vicinity of the Fiez Navoi:
One stop services. Navoi Fiez offer all the services necessary to establish and conduct a business in Navoi Fiez, thus saving time, effort and cost, and enabling you to focus primarily on the business.
All the conditions have been created to operate a business without going outside Navoi Fiez. They are:
On-going Projects
Significant benefits and preferences granted to foreign investors in the Fiez, such as tax exemptions, special customs and currency regime, as well as a simplified procedure of foreign staff residence have attracted investors from many large companies of the republic of Korea, China, India, the United Arab emirates and Singapore.
Over the short period of time about 12 projects have been launched in Navoi Fiez, among them:
In the course of implementation of above stated investment projects 466 work places have been created. In 2011, the enterprises registered in Navoi Fiez produced goods at the amount of UzS 36.8 billion. Planned activities.
At the same time building and assembly works are being conducted on additional 5 projects planned for launching during 2012, in particular organization of production of:
Besides on the two operating enterprises it is planned to organize new production of equipment for automobiles using compressed natural gas (“Uzerae alternator” JV) and accumulator wires (“Uzerae Cable” JV).
Also the preparatory work is being conducted on 25 project planned for implementation in near future in Navoi Fiez with participation of potential partners from USa, Germany, Italy, Korea, China, india and other countries.
Navoi International Intermodal Logistics Center
Developed multimodal network is considered as important competitive advantage that allows significantly shorten the time and costs of delivery of goods from Uzbekistan and transit through territory of the country, and international transport hub established at “Navoi” airport plays the important role in this regard.
Placed in the center of the country and on the crossroads of international land and air transport corridors “North-South” and “east-West”, the “Navoi” airport represents an ideal regional center for international freight flows management.
Based on agreement with “Korean air” company, the first phase of modernization of “Navoi” airport has been accomplished, including creation of international intermodal logistic center (iilC) and construction of cargo terminal with capacity of cargo handling 300 ton in 24 hours. In the future it is planned to increase capacities of the terminal up to 1000 tons subject to increase of freight flows.
The cargo terminal has 6 work stations for cargo handling works, 20-tons and 5-tons balances, refrigerator and freezer, warming room, storage facilities for dangerous goods, perishable foodstuffs and animals. Its administrative building features necessary services such as customs clearance, sanitary control, declaring, freight service and etc. the launch of the terminal allowed to bring the iilC to the maximum capacity, increase the volume of services, improve the productivity and profitability, as well as to ensure that the quality of logistics services meets the highest international standards. Today iilC functions as full-fledged system for land distribution of cargo arriving through the Navoi airport all over the region and for redistribution of air freight flows to directions North-South and West-east.
Navoi airport is operating around the clock. It features a 4 km runway, capable of handling all types of aircrafts, modern air-traffic-control system that meets the requirements of the international civil aviation Organization, iCaO. Istanbul, Doha, Dubai, Hanoi, Moscow, Bishkek, Seoul, Milan, Brussels, Shanghai, Paris, Zaragoza, Vienna and Basel are made from the Navoi airport.
The use of air corridors and landing in Uzbekistan provides considerable saving of time and shipping costs. For instance, the distance from South east asia to Europe via the Navoi airport is 1 thousand km shorter than via Dubai, including saving of 1.5 hours per flight and 15 tons of fuel per aircraft.
A tir-park for heavy vehicles is functioning near the airport. This park is capable of receiving simultaneously more than 20 freight vehicle.
Angren Special Industrial Zone
On December 13, 2012 in accordance with Decree of the president of the republic of Uzbekistan the angren Special industrial zone (aSiz) has been established in the Tashkent region. Offering foreign and local investors favorable conditions and wide range of opportunities for doing business, the angren Siz provides all the necessary conditions for establishment of modern high-tech and competitive production facilities. The proximity of angren Siz from the capital of Uzbekistan – Tashkent, makes it very attractive destination for investors. The body, which coordinates and regulates the activity of the angren Siz, is the administrative Board. Operative management of the angren Siz is carried out by the Directorate, incorporated as the State Unitary enterprise. The area of the angern Siz is 187.5 hectares. Operation period of the angern Siz is 30 years, but the term can be extended in future. Throughout the Siz operation period a wide range of benefits and preferences is provided. Special tax regime and customs preferences apply within Siz territory
Siz residents exempted from:
Abovementioned preferences are provided from 3 to 7 years, based on the volume of investments, including its equivalent:
The main criteria for the selection of business entities to provide them with the residence status of angren Siz include the following:
Although this new industrial zone has been established quite recently, some agreements to set up large industries have already been made here. For instance, 1000 daily tons capacity sugar plant is planned to be built here. Singapore companies “Welton international enterprises pte. ltd.”, “Kito investment pte. ltd.” and the Austrian company “Seid Nandelsgesellschaft m.b.h.” will become the partners of Uzbek side in the implementation of the project. The total project cost exceeds 108.45 million US dollars. Another project within the zone is aimed to create a modern production of base engine oils with a complete technological cycle of collection and recycling of waste industrial oils with the participation of Bulgarian investors. It is planned that investors will invest 15 million US dollars to conduct design and construction works, delivery and installation of modern technological equipment, which will process up to 43 thousand tons of waste industrial oil per year and produce base oils.
Angren International Logistics Center
Angren international logistic Centre (angren ilC) was founded in 2009 at ablyk railway station in angren and currently is one of the largest transshipment centers in Uzbekistan. its founders with equal shares of 16.66% are “Uzavtosanoat” JSC, “Uzbekistan railways” SJSrC, “Uzbekneftegaz” NhC, “Uzkimesanoat” SJSC, “Uzstroymateriali” JSC and the association of Food and oil industry. Angren ilC is located in transport network node with a large cargo turnover, having hundred hectares of area, at the place where several transport types paths are intersected. Here are located storages, combined terminal, access roads and maneuvering areas, road transport fleet, expertise and financial institutions (banks and insurance companies), post office, hotels and security structures. Very wide range of services can be provided to companies in logistic park. For foreign economic activity participants built customs post “angren-Fea”. transit-cargo terminal covers area of 8.6 Hectares and has railway track for loading and unloading. Simultaneous served volume is 22 containers with 60 containers storage and up to 1,500 tons processing at storage spaces.
In early 2009, angren ilC started to offer freight forwarding, cargo handling and cargo storage services, for one quarter of the year has been transported and processed more than 707 thousand tons of cargo. To stimulate traffic through new logistics center “Uzbekistan railways” SJSrC has reduced by 50% of intrarepublic goods delivery tariff from all over the country to ablyk station.
In 2010, 4.2 million tons of cargos were transported through the center, including automobile spares and “GM Uzbekistan” JV automobile plant finished products and Fergana oil refinery oil products. For angren ilC’s fleet development in 2010 was acquired 250 haulers of 36.5 million U.S. dollar value made at “MaN auto-Uzbekistan” JV. Logistics center expansion project approved by Uzbekistan government. Capacity expansion concerned with increase in spares supply for “GM Uzbekistan” automobile plant.
“angren” logistic center allows faster and more efficient process of goods turnover, to improve processing quality and reduce shipping component cost in their price.
Jizzakh Special Industrial Zone
According to the Decree of the president of the republic of Uzbekistan No. 4516 dated March 18, 2013, the Jizzakh Special industrial zone (Siz) has been established. Jizzakh Siz is a practical step within the framework of the memorandum of mutual understanding on implementing of project aimed to establish of the Uzbek-Chinese industrial park in order to form favorable environment for both foreign and local investments, to launch up-to-date high-end industries, which promote manufacture of high value-added competitive products.
Establishment of new industrial zone with the branch in Sirdarya district of Sirdarya region is also aimed at complex and efficient use of productive and resource capacity of Jizzakh and Sirdarya regions, as well as creation of new jobs and increase of people’s income. The main objectives and work areas of Jizzakh Siz are followings:
Jizzakh Siz residents exempted from:
Abovementioned preferences are provided from 3 to 7 years, based on the volume of investments, including its equivalent:
