Economy and Trade / SME

As of August 1, 2004 about 270 thousand SMEs have been incorporated in Uzbekistan. Small and Medium Business (SME) sector employs more than 55% of the labor force and accounts for 35% of the nation GDP.

There are three principal national laws which create legal framework for SME's activity. They are "On Private Enterprise", "On Entrepreneurship" and "On Guarantees and Freedoms for Entrepreneurial Activity". In accordance with Uzbek legislation SMEs have been defined as follows:

Individual Entrepreneurs
Micro Firms (0-10 employees)
Small Enterprises (10-40 employees)
Medium Enterprises (40-100 employees).

The Government of Uzbekistan (GOU) pays a great attention for the development of SME. In late 2002 simplified incorporation system- "one stop shop"- was introduced and later on simplified taxation mechanism- single tax. The GOU supports entrepreneurs by allocating venture capital to newly incorporated entities for start up of their business.

SMEs are exempted from surrender of parts of foreign exchange revenue, import duties on import of know-how and technological equipment and they are allowed to receive foreign exchange cash as a mean of payment for the export.

A Presidential Decree "On Creation of Chamber of Commerce of Uzbekistan" adopted in July,2004. Due to this Decree the Chamber will be responsible for promotion of SMEs' interest and protection their rights. Within the framework of the National Personnel Training Program a creation 155 specialized colleges to train professional for SME sector is underway.

To provide information support Marokand Information Center was created. The Center provides marketing analysis on foreign markets, current price conjuncture on different commodities, information on business and investment opportunities, funds from International Financial Institutions (IFI).

So far the cumulative value of credits allocated by IFIs for the development of Uzbek SMEs exceeds $400 mln, including $180 mln from EBRD, $100 mln from ADB and $50 mln Credit Facility from US. Ex-Im Bank.

To get access for local SMEs to cutting- edge technologies and equipment a special exhibitions has been held in all regions of Uzbekistan since 2000. During this exhibition called Minitech the latest world mini-technologies and equipment from world known manufacturers were displayed. This gives an opportunity to local SMEs to meet their demand in needed equipment to produce high quality products in accordance with international standards.