Tag Archives: Uzbekistan

GM sells cars in Uzbek soum

JUNE 2 2017 (The Bulletin) — GM Uzbekistan, a joint-venture between the US’ GM and state- owned Uzavtosanoat, started selling its cars in Uzbek soum for the first time, Reuters reported, rolling back a Karimov-era policy that insisted that the cars were sold in US dollars. Karimov was Uzbek president from 1991 until his death in September 2016. His successor, Shavkat Mirziyoyev, has promised to liberalise Uzbekistan’s economy. Karimov had wanted cars sold in soum in order to bring more foreign currency into the country.

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(News report from Issue No. 331, published on June 5 2017)

ADB lends $500m to Uzbekistan

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JUNE 1 2017 (The Bulletin) — The Asian Development Bank (ADB) approved a $500m loan to Uzbekistan to build 29,000 affordable houses in rural areas. The ADB has said that housing stock in Uzbekistan’s rural areas is particularly poor. Since Shavkat Mirziyoyev took over as president in 2016, institutional development banks have been lining up to lend Uzbekistan money for various projects.

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(News report from Issue No. 331, published on June 5 2017)

Uzbekistan bans violent computer games to protect “civil harmony”

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TASHKENT, MAY 25 2017 (The Bulletin) — Uzbekistan’s government banned 34 computer games because it said that they were too violent and corrupted their users.

Investors and Western analysts will be concerned that the ban betrays an authoritarian streak in Uzbek President Shavkat Mirziyoyev’s administration but gamers in Tashkent suggested that it smacked more of a lack of understanding and incompetence.

The surprise announcement banned violent computer games such as Grand Theft Auto and Call of Duty but also covered less aggressive games such as The Sims which focuses on parenthood.

The Uzbek government press release said that the games were a threat “to the political stability of the country, civil peace, interethnic and interreligious harmony”.

Mr Mirziyoyev has been Uzbek president since September 2016 when the authoritarian Islam Karimov, who banned pool halls, died. Mr Mirziyoyev has made a virtue of appearing less authoritarian than his predecessor, talking up the possibility of currency liberalisation and opening up to foreign investors.

In Tashkent, kiosks selling computer games continued to trade as normal with shopkeepers claiming that they hadn’t even heard of the ban. And there was also a sense in internet cafes that the government didn’t understand gaming culture.

One gamer who wished to remain anonymous said that most people download their games over the internet.

“This ban won’t have any effect,” he said. “Real gamers don’t visit internet cafes as the computers there aren’t powerful enough for the games on the banned list.”

Another gamer said the ban was “feckless” and “stupid”. He said the government had already tried and failed to ban hundreds of films as well as Valentine’s Day, Halloween and Christmas.

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(News report from Issue No. 331, published on June 5 2017)

Uzbekistan’s senate ratifies cotton deal with the European Union

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TASHKENT, MAY 30 2017 (The Bulletin) — Uzbekistan’s Senate ratified a deal with the European Union over textile exports, paving the way for an expected boost in one of the country’s most important revenue earning products.

The senate’s processing of the protocol was routine but it came only a week after an EU delegation visited Uzbekistan to discuss progress it had made on human rights. At the end of last year, the European Parliament voted to renew a 1999 deal to drop tariffs on cotton imports from Uzbekistan.

It had been suspended in 2011 over concerns about Uzbekistan’s use of child labour to pick the cotton.

During its visit the European Parliament’s human rights subcommittee had said that it was impressed with Uzbekistan’s openness.

“Our impression now, after a three-day visit, is of a country where change is in the air, the road to openness and modernisation lies open if the political resolve to choose the path is strong and consistent,” the group said in a statement.

Human rights groups have said that normalising trade deals over Uzbek cotton has come too early but for Uzbekistan it will be a boost.

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(News report from Issue No. 331, published on June 5 2017)

Cerrencies: Kazakhstan’s tenge, Kyrgyzstan’s som

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JUNE 5 2017 (The Bulletin) — In a week of little movement, it fell to the Kazakh tenge to, quite literally, fall – but only slightly. It fell 1.1% to trade at a shade above 314/$1, its lowest since mid-May.

The move was, probably, triggered by a downward shift in Brent oil prices. The price of Brent dropped to just above $50/barrel. This is still within the generally accepted trade corridor and the impact on oil-sensitive currencies around the world was limit. The surprise was that the Azerbaijani manat, already smashed by the near- collapse of its biggest bank, didn’t shift downwards.

Elsewhere, the Uzbek soum continued its slow and controlled depreciation, down 0.6%, and the Kyrgyz som fell 1.1% to 68.1/$1 – its lowest since the end of April.

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(News report from Issue No. 331, published on June 5 2017)

Turkmenistan and Uzbekistan plan to develop oil and gas fields

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MAY 20 2017 (The Conway Bulletin) — In yet another sign of improving Turkmenistan-Uzbekistan relations, the countries’ state-run energy companies pledged to jointly develop Caspian Sea oil and gas fields. It’s unclear if this deal has a practical bent to it or if it is designed simply to be an eye- catching bilateral deal.

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(News report from Issue No. 330, published on May 28 2017)

Uzbekistan agrees groundbreaking transit deal

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MAY 23 2017 (The Conway Bulletin) — In a deal described as groundbreaking, Uzbek officials agreed to allow the country’s electricity infrastructure to be used to export power produced in Turkmenistan to Kazakhstan and Kyrgyzstan. Analysts said that the deal, unveiled around yet another trip to Turkmenistan by Uzbek president Shavkat Mirziyoyev, showed that cooperation across the region had improved with the death last year of Uzbekistan’s Islam Karimov. Under the terms of the deal, Turkmenistan will send power to the Uzbek grid in exchange for the cancellation of its debt to Uzbekenergo.

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(News report from Issue No. 330, published on May 28 2017)

Uzbekistan’s long-serving Central Bank chief dies

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MAY 28 2017 (The Conway Bulletin) — Uzbekistan’s Central Bank chief, Fayzulla Mullajanov, died on May 24. He was 67-years-old and was perhaps the world’s longest serving Central Bank chief, officially holding the position since independence from the Soviet Union in 1991.

According to media reports, Mullajanov had been suffering from a kidney disease for sometime. In 2013 Ferghana News even reported that Mullajanov had fallen into a coma. This was denied but it is doubtful that Mullajanov has exerted much influence over Uzbekistan’s monetary policy in the last few years — either because he hasn’t been well enough or he simply hasn’t been empowered.

Appointed by Islam Karimov to head the Central Bank, Mullajanov was your archetypal Soviet-style official, prepared to put on a brave face and carry through decisions made by others.

He didn’t make monetary policy but he was expected to sell it.

This was clear from a US embassy report from May 2009 published, later, by Wikileaks.

In the cable, the US ambassador to Uzbekistan at the time, Richard Norland, recounted a series of meetings he had with senior Uzbek officials during a trip to Tashkent by deputy assistant US trade representative Claudio Lilienfeld. Mullajanov featured in the dispatch but only towards the bottom.

“After listening to a half hour recitation of Uzbekistan’s economic success and successes in the banking sector, Lilienfeld remarked that a major disincentive for US businesses to invest in Uzbekistan is the difficulty with capital convertibility,” Norland wrote.

“Expressing surprise that convertibility could be an issue, Mullajanov responded that conversion is done by the commercial banks. He assured us that he would personally look into any convertibility problems if they are brought to his attention in writing.”

Nothing more was said of Mullajanov in the memo, but Norland’s exasperation towards the Uzbek Central Banker was tangible. Mullajanov had been rolled out to sell Uzbekistan as a serious economy to the visiting US delegation. The reality was, as everybody knew, Karimov called the shots.

Uzbekistan’s monetary policy is dominated by its currency and this is set by central government. Mullajanov, who had only ever worked at the Uzbek Central Bank, was the face of this policy but not the architect.

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(News report from Issue No. 330, published on May 28 2017)

Uzbek banks to support cottage industries

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MAY 27 2017 (The Conway Bulletin) — Uzbekistan’s Shavkat Mirziyoyev ordered his government to set up a consortium of banks designed to support home-based businesses, media reported. The finance could be important in Uzbekistan where many businesses are based at home.

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(News report from Issue No. 330, published on May 28 2017)

Russia’s Shokoladnitsa to open coffee shops in Uzbekistan

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TASHKENT, MAY 26 2017 (The Conway Bulletin) — Highlighting an increase in coffee consumption across Central Asia and the South Caucasus, Russian coffee shop brand Shokoladnitsa said that it was working on a deal to open its first cafes in Uzbekistan and Georgia.

For Uzbekistan in particular, the opening of Shokoladnitsa branded coffee shops would herald a new era and open up opportunities for other companies looking to invest in Central Asia’s most populous country. There are currently no high street coffee shop chains in Uzbekistan. Uzbeks are also renowned for their love of sipping light green tea out of piala, a small handleless bowl, rather than drinking mugs of black coffee.

In an interview with the Russian-language Rambler website, Maxim Trubnikov, director of regional development and franchising at Shokoladnitsa, said he expected to open five shops in Uzbekistan and eight new shops in Kazakhstan.

“Currently, we are working with Georgia, Uzbekistan, negotiations are underway for the opening of the brand in Kazakhstan,” he said.

“I expect that we conclude the contracts in the coming months.”

Shokoladnitsa also owns the Coffee House and Wabi Sabi brands. It was one of the original coffee shop brands to expand across Russian, serving americanos and cappuccinos since 2000.

It already has franchises in Astana, Almaty, Yerevan and Baku. The coffee scene has become increasingly developed in Kazakhstan with the emergence of several coffee shop chains over the past few years, including Starbucks.

In Uzbekistan, a Bulletin correspondent said a coffee culture was slowly spreading through independent cafes in Tashkent but that tea was predominant.

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(News report from Issue No. 330, published on May 28 2017)