UZBEKISTAN
Uzbekistan, the heart of the Silk Road

Introduction - Investment climate - Financial development - Energy - Mining - Trade and industry -
Agriculture - Telecommunication - Transportation - Tourism - Conclusion


Uzbekistan
the heart of the Silk Road

Independence Day

Names like Alexander the Great, Amir Temur, Genghis Khan and Marco Polo have left their footprints in the sand of this ancient land - the land of the Uzbek people. They are the descendants of nomadic Mongol tribes who inhabited Central Asian during the 13th century, were ruled by khanates in the 17th century and were taken over by Russia at the beginning of the 19th century. It has been almost 10 years since Uzbekistan totally embraced the window of opportunity for national independence offered by the collapse of the Soviet Union in 1991. This country, a rather unknown republic of the Soviet Union which used to be famous simply for its cotton production, has travelled a long road of independence, a road of social reform, economic independence, and ultimately freedom.

President Islam Karimov, the only president the people of Uzbekistan have ever known, has skilfully taken the character of the people, the features of the economy and the customs of the past and woven them into policies that ideally suit the land and its people. At the outset of independence, he insisted that social and economic reform should be a gradual but steady step-by-step process, creating a favourable investment climate for both local and foreign companies continuously improving legislation for foreign investment protection and guarantees. Privatisation is presently top priority, and the influence of the private sector on the economy is significantly growing. Concurrently, he has implemented a very open foreign economic policy, always emphatically stating that the government has given preferential status to foreign economic activity, encouraging mutually beneficial relations particularly between the newly independent states. After being re-elected in January 2000 for the third time, Karimov continues to lead this country with an eclectic population of 24 million: 72% Uzbek, 8% Russian, 7% Tajik, 4% Kazakh and other ethnic groups such as Korean.

This ex-Soviet republic has not entirely cut its ties with Russia and the newly independent states. It still relies heavily on these countries in many aspects, especially trade. This co-operation has proved to be mutually beneficial, providing Uzbekistan with geographically easy trading partners. Given this, the president is still looking to Europe and the US as potential trading partners. Moreover, Uzbekistan although not referred to it centuries ago, has always enjoyed its geostrategic location. As in the past on the famous Great Silk Road, it will always serve as the hub for trade and transport throughout Central and Southeast Asia and the CIS, particularly Russia. It is comfortably located in the heart of a network of routes linking east and west, north and south. Its rich mineral resources, skilled workforce and industrial infrastructure serve as an adequate foundation attracting potential foreign business activity to the country. The destiny of this ancient land has always been to serve as an oasis for passing travellers.
The people of Uzbekistan have a rich heritage of hospitality and they are proud of the gems their country has to offer. The dynamic tourist trade presently operating in this country is an evidence of this heritage. Under the auspices of UNESCO, many historically significant monuments have been restored especially in the ancient Silk Road cities of Samarkand, Bukhara and Khiva. The many hotels and tourist agencies in the major tourist centres of Uzbekistan annually host tourists from all over the world, especially Europe and Japan. Representatives from the Uzbek tourist industry frequently take part in international tourist fairs and conferences to promote Uzbekistan as a new, unexplored destination for those interested in culture, history, archaeology and even extreme sports. Recently, this newly independent state portrayed itself to the world in Hannover WorldExpo in autumn 2000.

The Silk Road City Samarkand

It is generally thought that Uzbekistan is developing slower than any other newly independent republic, but on the contrary, Uzbekistan is one of the only country which has steadily maintained its general infrastructure. Although it needs overall improvement, social services such as utilities, education, health and transportation have been available since the independence, and are generously subsidised by the state. Furthermore, as opposed to some of its neighbouring countries, Uzbekistan has proved its capacity to sustain the political stability; the base for any other development and progress.

It should be understood that growth is a gradual process requiring patience and flexibility. As any other country in a similar position, Uzbekistan has had to show great fortitude during the past decade. Since the first steps into the independent and sovereign world, political, social and economic stability have been the goals of the government, and successfully the highest of all newly independent republics. Maintaining the status quo requires strong leadership on the part of the government, giving the people a positive sense of stability, but at the same time, satisfactory progress. Looking from the inside out, there is a world of potential traders able to supply the country which has been preserved from the rest of the world for most of the last century. Looking from the outside in, here is a country with enormous untapped potential.

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© World INvestment NEws, 2001.
This is the electronic edition of the special country report on Uzbekistan published in Forbes Global Magazine.
August 6th, 2001 Issue.
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