Business Expenses

Cooperation with international financial institutions and development partners

Cooperation with international financial institutions (IFI) and development partners is one of the pillars of the investment policy of Uzbekistan. At present IFIs and bilateral development agencies and financial institutions (BDAFI) actively participate in modernization of industry, development of infrastructure and transport communications, improvement of social infrastructure in Uzbekistan.

IFIs and BDAFIs play an important role in achieving targets of the Millennium Development Goals by supporting the main activities envisaged in Welfare Improvement Strategy for 2013-2015 inUzbekistan.

During the years of cooperation with the World Bank, Asian Development Bank, Islamic Development Bank, Japan International Cooperation Agency, German Development Bank KfW, Eximbank of China, Eximbank of Korea, Arab Funds of the Coordination Group, the European Commission and other IFIs and BDAFIs considerable experience in joint implementation of investment projects was accumulated, mechanism of consistent implementation of projects on the basis of mid-term cooperation programs was established.

Owing to strong relations with IFIs and BDAFIs their investments to the economy of Uzbekistan increasing annually. For the last five years the average growth rate of grant aid and technical assistance attracted to the country stood at 8.2%. This figure is expected to reach more than 186.0 mln. USD (7.5%) by the end of 2013. Growth in attraction rates was possible primarily due to the gradual expansion and systematization of cooperation with IFIs and development partners.

In accordance with the Decree of the Cabinet of Ministers of the Republic of Uzbekistan 90 dated 29.03.2013, issues of attracting grant aid and technical assistance of IFIs and BDAFIs in the amount of 285.6 million USD to finance projects in the areas of education, healthcare, agriculture and water management, institutional development of government agencies, drinking water and sanitation, development of energy efficiency, environment, SME support and other areas, being studied.

Financing of 35 projects worth 271.3 million USD included in the program of financial and technical cooperation for 2013-2017 being studied jointly with the Government of the People's Republic of China. In the framework of ODA of the Government of Japan and the Republic of Korea it is examined the financing of 14 projects worth 57.4 million USD and 9 projects worth 22.5 million USD, respectively. Works to developing a pipeline of projects for the implementation in the framework of technical assistance of the European Commission are underway with emphasis on the development of agriculture and improving rural livelihoods.

Also, the volume of long-term soft loans of IFIs and BDAFIs attracted to the country is increasing. In 2013 23 financial agreements totaling 2.96 billion USD were signed (growth of 214,5%).

Funds of IFIs and development partners are directed to the implementation of priority projects in the areas of healthcare, education, energy, development of road infrastructure, chemical industry, agriculture, irrigation and melioration, public utilities, water supply and sanitation, agriculture, rural housing, etc.

In order to furthering the financial and technical cooperation systematic works being conducted with IFIs to adopt the cooperative programs focused on mid-term prospective. In particular, cooperation program for 2014-2016 was launched with the Asian Development Bank (which consist of 38 projects worth 5.03 billion USD), cooperation program for 2014-2016 is underway with the World Bank (9 projects worth more than 1 billion USD.) and the Islamic Development Bank for the years 2014-2018 (19 projects worth 1.3 billion USD).

Cooperation with BDAFIs shown positive dynamics, too. 10 projects worth 1.23 billion USD being studied by the Eximbank of China, 3 projects worth about 0.5 billion USD by Japan International Cooperation Agency, 10 projects totaling 594,6 million USD by the Economic Development Cooperation Fund (EDCF) of Korea, 15 projects worth 480.9 million USD by Arab Funds of the Coordination Group, 4 projects worth 16 million Euros by the Federal Government of Germany.

Given the need to ensure the targets of State Programs for industrial development and improving infrastructure and transport communications for 2011-2015, as well as the Welfare Improvement Strategy of the Republic of Uzbekistan for 2013-2015, fulfilling of the following priorities jointly with the IFIs and development partners in the mid-term will be of special importance:

- raising competitiveness of Uzbekistan's economy by creating new high-tech industries, accelerating modernization, technical and technological renovation of existing facilities, as well as a significant improvement in the investment climate and business environment;

- continuation of accelerated modernization and development of transport infrastructure, including the construction and reconstruction of roads and railways, renewal of train and aviation fleets, infrastructure of electricity, gas and water supply and sanitation;

- ensuring advanced development of small business and services, especially, in rural areas, increase in employment and income, improvement of the life quality of the population;

- improvement of energy efficiency of the production, widespread introduction of energy-saving technologies and energy development based on renewable energy sources;

- wide introduction and rapid development of information and communication technologies and enhancing their role in the economy;

- continuation of reforms in healthcare and education sectors;

- enhancing activity in the sphere of ecology and environment protection, including in the Aral Sea and other regions with complex environmental conditions, development and implementation of green economy technology.

Given these priorities collaboration with IFIs and development partners to implement the following key activities on the base of mid-term cooperation programs will continue in 2014 and 2015:

First, work to coordinate projects in priority sectors of the economy sent for review of development partners, including Japan, the People's Republic of China, the Republic of Korea, Federal Republic of Germany, France and the Arab countries, will continue;

Secondly, activities on commencement of projects included in mid-term cooperation programs with IFIs and development partners will be undertaken jointly with concerned ministries and departments of Uzbekistan;

Thirdly, study will be carried out with a potential development partners and international organizations in attracting foreign loans and grants to develop mid-term cooperation programs, as well as their timely implementation;

Fourthly, along with the traditional partners in financial and technical cooperation, it is planned to establish closer cooperation with potential development partners, including France, Austria, Hungary, Poland, India, Brazil and others, by:

- studying their activities and determine their specialization in strategic areas;

- establishing cooperation with them and concluding protocols of intentions, memorandums, agreements and other documents, as well as ensuring their efficient implementation;

Fifthly, improving the efficiency of interaction with the investment divisions of the ministries and departments - the initiators of the projects established by the Decree of the Cabinet of Ministers of the Republic of Uzbekistan 84 dated 23.03.2011, in order to ensure a systematic and timely implementation of measures and solving procedural issues of preparation priority projects for implementation. It is planned to build such principle of interaction by continuously monitoring the effectiveness of the organization of the investment departments of ministries and departments on the basis of the evaluation criteria to identify issues and timely development of specific proposals to solve them;

Sixthly, conducting of works to attract funds from IFIs and development partners to finance priority technical assistance projects in 2014 according to the Decree of the Cabinet of Ministers of the Republic of Uzbekistan 90 dated 29.03.2013, as well as grant aid projects aimed at supply of materials and machinery to:

- universities in the country in accordance with the Resolution of the President of the Republic of Uzbekistan 1533 dated 20.05.2011 On measures to strengthen the material and technical base of higher educational institutions and radically improvement of the quality of education of highly skilled specialist ;

- healthcare institutions in accordance with the Resolution of the President of the Republic of Uzbekistan 1652 dated 28.11.2011 On measures to further deepening the reform of the healthcare system;

- customs authorities of the country in accordance with the Resolution of the President of the Republic of Uzbekistan 1595 dated 10.08.2011 On measures to further improving and increasing the effectiveness of activities of the State Customs Service.

Seventhly, studying of the issue of attracting grants and technical assistance to finance activities aimed at the implementation of the Year of healthy child and support the activities of the Executive Committee of the International Fund for Saving the Aral Sea during the presidency of Uzbekistan.

Eighthly, improvement of coordination of activity of the international financial and economic institutions (IDB, GEF) and bilateral development agencies and financial organizations (KfW, GIZ, SECO, AFD, Eximbank of Korea, Eximbank of China, CDB) in Uzbekistan in the framework of implementation of joint projects financed by attracting soft loans and technical assistance;

Ninthly, ensuring timely and effective implementation of projects financed by IFIs and BDAFIs;

Tenthly, further improvement of legal base of cooperation with IFIs and development partners.

MFERITMEDEF InternationalInternational Business CenterGov.uzPress ServiceOliy MajlisUzASARIO