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Ministry for Foreign Economic Relations, Investments and Trade of the Republic of Uzbekistan

. INVESTMENT ENVIROMENT IN UZBEKISTAN AND PROSPECTS FOR COOPERATION. Ministry for Foreign Economic Relations, Investments and Trade of the Republic of Uzbekistan. FACTORS OF SUCCESS IN UZBEKISTAN. The leading industrial economy in Central Asia. 1. Political and macroeconomic stability.

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Ministry for Foreign Economic Relations, Investments and Trade of the Republic of Uzbekistan

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  1. . INVESTMENT ENVIROMENT IN UZBEKISTAN AND PROSPECTS FOR COOPERATION Ministry for Foreign Economic Relations, Investments and Trade of the Republic of Uzbekistan

  2. FACTORS OF SUCCESS IN UZBEKISTAN The leading industrial economy in Central Asia 1. Political and macroeconomic stability 2. Rich raw materials base 3. Energy self-sufficiency 4. Advantageous geographical location 5. Diversified industrial base 6.Scientific and intellectual capacity of the country 7. Legal base and system of investment incentives for foreign investors

  3. MAIN MACROECONOMIC PARAMETERS Structure of GDP production (%) GDP growth (% to previous year) 2010 2005 2000 1995 0 20 40 60 80 100

  4. Industry growth rate in Uzbekistan Growth rate of industrial output and share of the industry in GDP

  5. Active foreign trade policy Foreign Trade in 2010: Turnover growth – 103,0% Export growth – 110,8% Trade balance – 4,3 bln. USD - Export promotion and development of infrastructure - Expansion of export loaning, insurance perfection, quality control system and certification of products - Creation of logistic centers for the effective transportation of export cargoes - Unification of customs procedures Export growth (in mln. USD)

  6. MAIN MACROECONOMIC PARAMETERS Inflation rate Effective moderately rigid monetary and fiscal policy has allowed to support inflation rate at rather low level Public external debt of the country does not exceed 10% of GDP

  7. 2. ACCESS TO RICH RAW MATERIALS Uzbekistan possesses unique mineral resources: • Solid raw materials, including ferrous and non-ferrous • Over 2800 of deposits and 100 kinds of mineral resources

  8. 3. ENERGY SELF-SUFFICIENCY Heat energy Energy resources are sufficient to cover demand of the economy at least for 100 years Oil and gas Hydro energy Electric energy

  9. Cost of doing business in Uzbekistan Average prices for: Gas - $50 per 1000 m3 Electricity - $0.35 per kWT/h Water - $0.18 per tn Labor - $350-500

  10. ALTERNATIVE ENERGY SOURCES Alternative energy sources in Uzbekistan: • solar energy • wind energy • biofuel • solid waste recycling • combustible shale 51 bln. ton of oil equivalent

  11. 4. Central GEOGRAPHICAL LOCATION CLOSE TO THE LARGEST MARKETS CA & Afghanistan: 90 mln. people CIS CIS: 300 mln. people Europe Moscow Central Asia Minsk London Berlin Astana East Asia Kiev Brussels Paris Beijing Bishkek Ashgabat Tokyo Ankara Seoul Tehran Baghdad Kabul Jerusalem Shanghai Amman Cairo Doha Riyadh South-East and South Asia Abu Dhabi Muscat Most Favorable Nation Treatment Middle East& Africa Manila Bangkok Phnom Penh with45countries, including EU countries, Japan, China, India, Republic of Korea, US, and others Singapore Jakarta

  12. 5. LEADING INDUSTRIAL BASE IN THE REGION Electrical engineering Electronics Automobile Oil, gas & petrochemical Agricultural machinery Pharmaceuticals Chemical Building materials Textiles Food processing Mining & metallurgy

  13. 6. WELL EDUCATED HUMAN RESOURCES AND HUGE INTELLECTUAL POTENTIAL • 65universities and institutions • 850directions • 300thousand students • affiliates of key foreign universities: • Moscow State University • Westminster International University • Singapore Institute of Management Development • Turin Polytechnic Institute • Oil&Gas Institute named afterGubkin

  14. 7. DEVELOPED LEGAL BASE & BROAD SYSTEM OF PREFERENCES AND BENEFITS FOR FOREIGN INVESTORs Law of the Republic of Uzbekistan on “Guarantees and measures designed to protect rights granted to foreign investors” Stable legislationduring 10 years Foreign investments and other foreign assets are not subject to nationalization Free transfer of money resources in a foreign currency into Uzbekistan and from it without any restrictions

  15. FOREIGN INVESTMENTS IN UZBEKISTAN In 2010: Under Investment Program for 2010 more than 200 projects of large-scaled enterprises has been set in operation Attracted 3,77 bln. USD of total foreign investments including foreign direct investments 2,76 mln. USD Growth rate – 10,6% • Foreign investments (bln. USD) • Share of FDI (%)

  16. ENTERPRISES WITH FOREIGN INVESTMENTS CNPC 4200 enterprises

  17. Investment cooperation between Uzbekistan and INDIA To 2010 Total investments– 93,15 mln. USD Trade turnover – 150,7 mln. USD Export – 27,2 mln. USD Import – 123,5 mln.USD Export Import

  18. New Prospects for Cooperation 1. MINI-TECHNOLOGIES & EQUIPMENT FOR SMEs 2. Electronics (Consumer electronics, IT products and etc.) 3. Textile Sector (Silk, ready made garments and etc.) 4. Building materials 5.Household chemicals 6.Pharmaceutics 7. Food industry 8. Free Industrial Economic Zone “Navoi” 9. Tourism (Construction and management of hotels and etc.)

  19. MINI-TECHNOLOGIES & EQUIPMENT FOR SMEs Production of equipment for agriculture and food processing, packaging 3-year market capacity is estimated at 3-5 bln. USD Industrial enterprises are stable consumers of new equipment and spare parts

  20. ELECTRonics Central Asia demand in: • Refrigerators and air conditioners – 1 mln. units • Washing machines and vacuum cleaners – 600 thsd. units • Microwaves – 300 thsd. units • Lamps – 500 mln. units

  21. Textile sector Textile companies in Uzbekistan: - Cotton fiber production – 1,2 mln. tons - Domestic processing only 30% of cotton fiber - Yarn production - more than 360 ths. tons - 50% discount from world cotton price - Only CIS textile market is 6,0 bln. USD - FTA within CIS countries

  22. BUILDING MATERIALS Glazed tile Stone tile Sanitary ware Ashlar Parquet Annual domestic needs in ceramic tiles - 10 mln. sq. m sanitary ware - more than 160 thsd. units

  23. HOUSEHOLD CHEMICALS Production of demanded chemical products in Central Asia Annual regional demand for soap – 130 thsd. tons, detergents – 300 thsd. tons

  24. PHARMACEUTICALS Domestic demand for pharmaceuticals: • injections – 300 mln. ampoules • infusions – 50 mln. flasks • biopharmaceuticals – 500 thsd. packs • anticeptics – 100 thsd. flasks • antibiotics – 50 mln. flasks • uncture– 1 bln. packs • suture – 500 thsd. r.m. • syringes – 200 mln. units

  25. FOOD PROCESSING Annual production potential of fruits and vegetables is 10 mln. tn Proposals for cooperation: Storage, freezing, processing, production and packaging of agriculture products, beverages and confectionery.

  26. FIEZ “NAVOI”: CONCEPT OF CREATION • FIEZ “Navoi” was created by the Decree of the President of the Republic of Uzbekistan on December 2, 2008. • Established near Navoi city administrative centre of Navoi region • The concept is based on the synergy of its 4 blocks or hubs: • - industrial • - logistic • - innovation • - touristic, cultural & recreational

  27. FIEZ: INCENTIVES AND PREFERENCES The FIEZ residents are exempted from: • Land tax • Property tax • Profit (income) tax • Unified tax (for SMEs) • Obligatory payments to the Republican Road Fund • Republican Fund of Elementary and Secondary Education Registered enterprises for the whole period of FIEZ functioning to produce export goods are exempted from customs duties for imported: • equipment • raw materials • production components

  28. FIEZ “NAVOI”: CURRENT PROJECTS Set in operation • Automotive fuel equipment (Korea) • Gas metering equipment (Korea) • Pharmaceutical and medical goods (Korea) • Hygienic production (PRC) • LED lams (Singapore) • Polyethylene pipes • Polypropylene pipes • Automobile wires (Korea) • Automobile OEM components (India) • Set-top box digital receivers (Singapore) • Fruit and vegetable production packaging (UAE) • Cosmetic output (Korea) Under preparation • Silicon polycrystals (Korea) • Silicon policrystals (Korea) • Production of medicaments (Poland) • Production of medicaments (Singapore) • Gas metering equipment (USA) Under construction • Automobile alternators (Korea) • LCD monitors (Korea) • Energy saving lamps (Korea)

  29. Tourism Largest tourist potential among the countries of Central Asia Ecological and sports tourism Medical and health tourism Proposals for cooperation • Construction of new world-class hotels • Construction of motels and camping’s recreation units along automobile roads • Establishment of joint travel agencies • Management of existing hotels in Samarqand, Urgench, Tashkent • Tourists exchange

  30. . THANK YOU! www.investuzbekistan.uz www.fiez.uz www.exporter.uz

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