Outcomes of the Socio-Economic Development of Uzbekistan in 2015 and the Most Important Priorities of Economic Program for 2016.   The Cabinet of Ministers of the Republic of Uzbekistan convened for an extended meeting on 15 January 2016 to discuss the outcomes of socio-economic development in the country in 2015 and the crucial priorities of economic program for the year 2016. The President of the Republic of Uzbekistan Islam Karimov delivered a keynote speech at the session. In his address the Head of State have underlined that analyzing progressive advancement of the country on path of democratic reforms and sustainable development, Uzbekistan has all grounds to state that last year the country had undertaken decisive steps in implementation of fundamentally important reforms aimed at achieving the main goal – to reach the level of developed democratic countries in the world with a strong social oriented economy, providing a decent standards and quality of life of Uzbek people. In this context, the President had noted the implementation of a well thought-out Program aimed at providing deep structural changes, reliable protection of interests of private entrepreneurship and small business, and what is crucial – ensuring of prioritizing the role of the private property, progressive reduction of state presence in Uzbekistan’s economy in legislative, regulatory and practical terms as it is outlined in the Constitution. Summarizing the outcomes of 2015, the President Islam Karimov claimed that the country had carried a huge scale and depth of work on renewal and reform of country, achieving stability and sustainable growth and macroeconomic balance of economy. Despite the ongoing global financial and economic crisis, last year the GDP grew by 8%, industrial output – by 8%, agricultural production – by almost 7%, construction and installation works – almost by 18%. The annual budget is executed with a surplus of 0.1% of GDP. The inflation rate was at 5.6%, that is, within the forecasted parameters. In spite of the significant slowdown in the world trade and reduction of external demand, world prices decline for major export commodities, Uzbekistan have managed to achieve a positive balance in foreign trade, which allowed for growth of state reserves. Low level of public debt that does not exceed 18.5% of GDP and this demonstrates the results achieved and the macroeconomic stability in the country. In 2015 more than 980 thousand jobs were created, including more than 60% – in rural areas. According to the rating of prominent World Economic Forum, Uzbekistan is among 5 countries with the fastest growing economy in the world in 2014-2015 and forecasts of growth for 2016-2017. Besides, in 2015 Uzbekistan became one of 14 countries that have received awards for achieving of the Millennium Development Goals in food security by Food and Agriculture Organization’s (FAO) Member States. The President had noted that work carried out in the country to improve the business climate is reflected in positive business environment rankings of international economic organizations. Last October the the World Bank published the rating of «Doing Business», with the fact that Uzbekistan in just one year has risen to 16 positions and ranked as 87th. It should be particularly underlined that according to criteria such as «Starting a Business», Uzbekistan is ranked as 42nd, «enforcing of contracts» – 32nd and «Resolving Insolvency» – 75th. According to the indicator «Getting Credit», Uzbekistan for the last three years rose from 154th to 42nd rank improving only over the last year its ranking by 63 positions. As mentioned in the World Bank’s report, Uzbekistan is currently among the top ten countries in the world, which in the last year achieved the best results in improving the business environment. Due to the undertaken measures, the share of small business and private entrepreneurship in gross domestic product had risen from 31% in 2000 to 56.7% at the present, or 1.8 times. This sphere now produces one third of industrial and 98% of agricultural products. It employs more than 77% of the total employed population. The Head of State had underlined that serious attention should be paid to attraction of inward investment in implementation of projects on modernization, technical and technological renewal of industry, structural change in economy. To this end, in 2015 investments from all financing sources in the equivalent of $15.8 billion were drawn and utilized, or increase against 2014 by 9.5%. With more than $3.3 billion, or over 21% of all investments are foreign investments, of which 73% are foreign direct investments. 67.1% of all investments are channeled at industrial construction. This allowed in 2015 to complete the construction and to put into operation of 158 large production facilities with a total value of $7.4 billion. Among facilities put into operation one can mention Ustyurt Gas Chemical Complex at Surgil deposit which had been built jointly with South Korean investors and experts. This complex is worth more than $4 billion and it is one of the most modern high-tech and large industries in the world. Its commissioning will allow to receive annually 83000 tons of polypropylene, which had previously been imported, to increase polyethylene production by 3.1 times, to employ more than one thousands of highly qualified specialists. JSC «GM Uzbekistan» in Khorezm province had launched serial production of mini-trucks «Chevrolet Labo», overall cost of project totals approximately $6 million, and annual capacity is 5000 machines necessary for farmers and entrepreneurs. It should be mentioned that this is the third model produced at the new plant «Khorezm Auto», which had already launched production of cars «Damas» and «Orlando». In the Pap district of Namangan province a solar photovoltaic power plant of 130 kW had been put into operation. So far this pilot project, but by 2020 the country plans to put into operation three more solar power plants of 100 MW each. High-speed passenger train line from Samarkand to Karshi had been opened and it allows to organize the running of high-speed trains «Afrosiyob» from Tashkent to Karshi. As a result the passengers transportation duration from the capital to Kashkadarya province and back reduced twice. The profound structural changes are taking place in agriculture of Uzbekistan. Through hard work and skills of farmers despite the difficult weather conditions Uzbekistan managed to grow and harvest a rich crop of agricultural products – produced more than 7.5 million tons of grain, more than 3.35 million tons of cotton. The average yield of wheat in country reached 55 quintals per hectare and in some areas even reached 60-77 quintals per hectare, which is a great achievement of Uzbek farmers. Besides, the rapidly developing sectors of agriculture such as horticulture, gardening, viticulture and cattle breeding. Last year, 12,59 million tons of vegetables, including potatoes, 1.85 million tonnes of melons, 1.56 million tons of grapes, 2.73 million tons of fruits had been harvested. In 2015 the service sector had provided more than half of gross domestic product. Currently, its share in GDP reached 54.5% compared to 49% in 2010. This area employs more than half of the total employed population. Banking, insurance, leasing, consulting and other kinds of market services contributing to the development of the private sector and small business in country are booming as well. In this sphere there are 80.4 thousand small businesses, accounting for more than 80% of the total number of service industries. In 2015 the banking system was further strengthened by increasing level of capitalization and expansion of investment activity of banks. The total capital of banking system increased in comparison with 2014 year by 23.3% and reached 7.8 trillion soums. Over the last 5 years this figure increased by 2.4 times. The capital adequacy ratio of the banking system is almost 24%, which is 3 times higher than generally accepted international standards, and its liquidity – 2 times higher than the highest indicator estimates.

The outcomes achieved in 2015 sustained high rates of economic growth that created a solid basis for further income growth, improving living standards and quality of Uzbek people’s life. Salaries of employees of budgetary institutions, pensions and stipends increased by 21.9%, and the real aggregate income per capita increased by 9.6%. It should be noted that the share of income from business activity rose to 52% compared to 47.1% in 2010, significantly higher than in the CIS countries. Uzbekistan focuses on reduction of social stratification. The income ratio of  the richest 10% of the population  and 10% least well-off population – the so-called «decile dispersion ratio» moves downward steadily, and in 2015 indicated 7.7, compared to 8.5 in 2010. International indicator of the separation of income – Gini-coefficient in 2015 was 0.280 against 0.390 in 2000 and its level is much lower than in many developed and developing countries. Income growth contributed to increased domestic consumer demand. Retail turnover increased over the year by more than 15%, and paid services – by 10.8%. Qualitative changes have taken place in level and structure of availability of durable goods, most of which are now produced in our country. In particular, provision of families with cars grew 1.5 times in five years, the personal computers – during this period 3.9 times, air-conditioners – 1, 7 times, mobile phones – 1.6 times. According to the World Happiness Report  made in 2015 by a group of independent organizations and international experts under the auspices of United Nations, which features the ability of a country to provide its residents a happy life, out 158 countries worldwide Uzbekistan rated as 44th against 60th position in 2013. Government’s focus over the last year was made on further reforming and improving education. Annual spending on education in Uzbekistan make up about 10-12% of GDP, which is almost 2 times higher than the relevant recommendations of UNESCO (6-7%) on the size of investment in education necessary to ensure country’s sustainable development. As a result of the measures implemented over the past five years, maternal mortality per 100 thousand live births dropped from 23.1 to 19 cases, the child mortality rate up to 5 years – from 14.8 to 13.9 and infant mortality – from 11 to 10.7. According to these indicators, Uzbekistan has fully achieved relevant Millennium Development Goals. Particular attention is paid in Uzbekistan to the development of physical culture and sports, which are an important and effective factor in health promotion. In 2015 the Uzbek athletes at the world championships, Asian and other international tournaments, won more than 860 medals, including 311 gold, 274 silver and 276 bronze. Especially Uzbek athletes successfully perform in sports such as athletics, gymnastics, boxing, wrestling, judo, taekwondo, equestrian sports. Last year the Government also on ensuring full implementation of State program «Year of attention and care for the elder generation». More than 215,000 elderly people last year have passed free medical examination. Needy persons with disabilities have the opportunity to receive more than 11,000 prosthetic and orthopedic products and technical means of rehabilitation of high quality. About 70,000 veterans were covered by the medical examination in hospitals and health recreation and spa facilities. All centenarians of Uzbekistan who have reached the age of 100 years, received special allowance of one minimum wage added to their pensions. Based on deep analysis of trends in global economy and realistic assessment of our resources and capabilities, Uzbekistan had set a target by 2030 to increase GDP of the country by at least 2-fold. Due to drastic structural reforms the country intends to achieve accelerated growth of industry by bringing its share in GDP to 40% against 33.5% in 2015, while share of agriculture to decrease from 16.6% to 10.8%, to reduce energy intensity of GDP by 2 times by introducing energy saving technologies nationwide. Deep processing of cotton fiber, fruits and vegetables using modern technologies will allow to increase by 2030 production volumes demanded on domestic and foreign markets environmentally friendly finished textile and light industry products by 5.6 times, fruits and vegetables – by 5.7 fold. In order to achieve qualitative structural changes in agriculture and development of the economy as a whole, the government of Uzbekistan focuses on gradual reduction by 2020 production and state purchases of cotton from 3.35 million tons to 3 million tons. It is worth to claim that by reducing the production of raw cotton by 350 thousand tons about 170.5 thousand hectares of irrigated land are going to be freed. Thus, as a rule, freed land have low yield class where crop does not exceed 12-15 quintals per hectare – with the average yields nationwide 26.1 quintals per hectare. Mostly saline land and land in the foothill areas unsuitable for growing cotton get freed. As a result of optimization of crop areas and introduction of modern agricultural technologies by 2020 Uzbekistan is to bring production of cereal crops up to 8.5 million tons with an increase of 16.4%, increase of potato production by 35%, other vegetables – 30%, fruit and grapes – 21.5%, meat – by 26.2%, milk – by 47.3%, eggs – by 74.5%, fish – by 2.5 times. The reality of the task can be judged based on the following calculations. In order to achieve the growth of GDP 2 times for 2016-2030, it would be enough to provide average annual growth rate of 4.8%, while over the past 11 years the average GDP growth rate in the country amounted to at least 8%. In modern conditions, in the era of the Internet and electronic Uzbekistan attaches prior attention to wide introduction of modern information and communication technologies in the fields of economy, a radical acceleration of the creation of the «Electronic Government». Even today the ICT accounts for about 5.5% of world GDP, and according to prominent international experts estimates by 2020 this figure will exceed 9%. For example, in Republic of Korea share of the ICT sector in the country’s GDP totals more than 11.8%, in Sweden – 7%, in United States of America – 6.8%. Despite the fact that in recent years this sector of Uzbekistan’s economy is developing rapidly. It must be recognized that the country is only at the initial stage and the ICT share accounts for only about 2% of GDP. The President of Uzbekistan had underscored that at the present country has all necessary resources and opportunities for more rapid development of the sector, with a view of growing up professional workforce capacity trained by foreign universities operating in in Tashkent such as South Korean Inha University and education institutions of Uzbekistan. He also informed that 2016 was proclaimed as the Year of Healthy Mother and Child. In order to implement the relevant action programme a lot of need to be done. Special attention of the programme is paid to such issues as further strengthening of protection of family, motherhood and childhood, formation and consolidation of material and technical base, personnel potential perinatal and screening centers, nursing services , increase level and quality of care for young mothers and children, creation of healthy spiritual environment in families, formation of girls’ physical health and intellectual development of compulsory education in academic lyceums and vocational colleges, their regular sport exercises. Information: Embassy of the Republic of Uzbekistan in Brussels http://uzbekistan.be/

While the media report unprecedented arrivals of migrants and politicians keep mentioning how little time there is to reduce the pressure on Europe’s external borders, very few consider the bigger and deeper significance of the ongoing migration and flight to Europe.   By Martin Wyss, Chief of Mission, International Organization for Migration. At the moment, it is increasingly difficult to comment in a meaningful way on migration flows to Europe as opinions, analyses and predictions on the subject are literally a dime a dozen. But while it appears as if anything goes, the universe of discourse is actually limited to a frame which can be summarized as how many will be too many. The views in the media resemble a rotating compass needle unable to find its pole. Almost daily, new announcements are made by different Governments, and these declarations of intent are often cited as new facts in the media before their factuality has been tested against legal, diplomatic or political backgrounds: for instance the exclusion of Greece from Schengen, sky-high numbers of planned returns of rejected asylum seekers from Sweden, thousands of missing children who may have fallen into the hands of traffickers etc. Maybe we are stuck and going in circles because our frame of reference is still too “Eurocentric”, and maybe it is time to reflect upon the recent quote of the German Minister of Finance who referred to the quickly unfolding developments in Germany as a “rendezvous with globalization”. In her historical speech in Karlsruhe, Angela Merkel used Schaeuble’s image twice, and the Minister himself elaborated on its meaning during the WEF in Davos in January. Basically, what he is saying is that Europe is surrounded by a “ring of fire”, meaning neighboring or not very distant regions with serious, unsolved problems, and that if we do not wake up to the problems affecting people in these regions, the people will come to us, to Europe rather than going to Canada or Australia. He thus proposes to build an alliance of the willing in order to put together a new Marshall Plan for these regions with the aim to reduce the pressure on Europe’s external borders. Although the term Marshall Plan has been overused in the past, it is clear that direct, diplomatic, political and financial engagement with regions affected by crises will be inevitable, albeit difficult. If we accept that there is really no alternative to Schaeuble’s proposal, then we have to differentiate types of aid and interventions that such a Marshall Plan would cover, and to consider their potential for success. Humanitarian Aid: The need to support those countries which host the highest numbers of refugees is overdue. It is now acknowledged by all that significant reductions in funding for the refugees in Turkey, Lebanon and Jordan in the recent past was an unexplainable mistake. The three billions for Turkey have now been pledged and ten billion have been raised for Syria in one day in London. Development Aid: In spite of many decades of exporting Western models for economic growth and prosperity development aid has not worked very well. In order to achieve sustainable development (together with democracy, human rights, “good governance” etc.), it was assumed, that all that was needed was more money, but this does not seem to be the case. The good news is that economic growth and reduction in poverty have taken place around the globe, but where it did take place it cannot be ascribed to money flows from Western development aid. Economic development requires functional governance which can lead to more investments and growth, but imposing functional governance from outside simply does not work, – too much good money has been thrown after bad already. Military Aid: The Pax Romana had its limits and so did the Pax Americana, something President Obama would agree with. Compare the enthusiasm after Kosovars returned to their country in 2000, and the hope for some after the falls of Saddam, Ghaddafi or the Taliban with the unsolved problems after the short celebrations. What could be the solution for Syria, a humanitarian disaster as a result of innumerable, diametrically opposing interests and actors so at odds with each other that fundraising to protect Syrian civilians coincides with dropping bombs which force many more to flee to Turkey. Many countries on different continents have undergone moments of great steps forward towards Western values which were held as universal, but in many cases the achieved progress was reversed. It is thus time to reflect on our repeated and maybe too naïve discourse on development, democratization, human rights and good governance, and it is time to reckon with the limits of our supposedly universal messages, our failed interventions and the lack of success the West had in exporting values, norms and rights. We are daily made aware of the reality of Globalization, distances for information and goods have shrunken dramatically and continue to shrink, but we wrongly assumed that global interconnectivity would lead to a natural development towards global, i.e. Western values which we believed to be universal. To be fair some values are supposed to be universal, e.g. the declaration of universal human rights, but is there agreement on how to apply it? On democracy there is clearly no consensus, and even less so when we consider what type of democracy works best for the governed people. Is it possible that the lack of success of Western interventions in exporting stability, peace and models for economic development may be linked to an almost utopian (some call it religious) belief that the Global Village must and will be governed by Universal Values? If indeed, as Schaeuble’s image suggests, the part of the world with countless unsolved and unaddressed problems is coming closer to the more prosperous part, then it is time to understand that the few islands of prosperity can no longer be kept separate, apart or at arm’s length from a very different and for many of its inhabitants harrowing world. It is a pity that by far the highest number of articles and pictures related to the arrival of migrants in Europe focused on the perilous journeys they undertook. Although it is understandable in view of the tragic loss of human life, the unimaginable suffering of the survivors and the many heroic rescue interventions, but I regret that the media did not pay more attention to the real root causes: from running for your life from snipers and barrel bombs to being without a job in Kosovo or Tunisia. I firmly believe that more attention will have to be paid to the real causes for the root causes when discussing refugees and migrants. We understood what provoked the beginning of the “Arab spring” in Tunisia, do we understand how terrorism can kill off tourism and job opportunities? Have we thought about the harsh consequences of lower oil prices for certain countries? And have we thought enough about the consequences of replacing authoritarian regimes? In the main European destination countries such as the Netherlands, refugees invited as speakers in conferences and panels, regularly remind the audiences that nobody leaves happily, nobody loves to separate from his or her family, house, village, city, his or her belongings etc. In other words, they came because staying was no longer an option, and because they were forced to run for their lives or because they had to give up any hope for a future in the villages, towns and lands they called their own. When speaking up in favor of welcoming refugees, it is therefore only logical and just to simultaneously address the root causes (rather than refer to them as if they were a God given inevitability), and to denounce the many ills, injustices and atrocities that forced them to flee. When human beings are forced to run away from other human beings, we can no longer act as if the causes were forces majeures such as erupting volcanoes, earthquakes or typhoons. We live in a Global Village without universal values and with very little global governance, but much better global governance could be achieved if we insisted less on universal values, and if we invested more in evidence based Realpolitik. Information: International Organization for Migration http://www.iom.int/