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NEWS AND EVENTS
January 29, 2015
REGIONS: THE REPUBLIC OF KARAKALPAKSTAN
The present day Karakalpakstan ranks among Uzbekistan’s fastest growing regions. Today, it is hundreds of new industrial enterprises, comfortable houses and highways that are surprisingly well for many European countries. They are the outcomes of huge efforts that have been made in the years since independence. Delivering a keynote speech at a cabinet meeting on the outcomes of 2014 and prospects for 2015, the President of Uzbekistan Islam Karimov mentioned the region’s progress and achievements, as well as key initiatives that have been implemented.

Development vector

The economy of Karakalpakstan showed excellent dynamics last year.

For instance, the national program the ‘Year of the Healthy Child’ alone drew more than 254 billion soums (currency rates of CB RU from 29.01.2015 1$= 2436.16 soums). The authorities have done much to improve the living conditions of young families, support small businesses, private enterprises and women. A range of intensive measures helped to strengthen the logistical capacity of medical institutions, advance skills of workers, build and reconstruct children’s sports facilities. The construction of a new bridge and a ring road at the entrance to the city of Nukus has entered its final stage. Fifty apartment homes of standard design will be built along the Doslyk Channel, and another 56 houses will spring up on the central streets of the capital. A Youth Center will be commissioned near the Tashkent Hotel. The construction of a water park, musical fountains, and sports grounds is under way. Ajiniyaz Park and a Children’s Park are in designing stages.

The year 2015 promises to be as eventful. The budget of Karakalpakstan is projected to exceed 1.2 trillion soums. A total of 1.1 trillion soums, the larger part of the budget, will be allocated for the social sector and support of the population. Significant funds will be invested in the establishment of advanced technological industries, the number of which was seriously replenished last year. The establishment of spinning manufacture on the basis of the Mangit enterprise ranks among examples of effective development. After reaching full production capacity, it will be capable of producing up to 5,000 tons of goods annually. Islam Karimov highlighted this successful initiative in his speech at the cabinet meeting.

As noted by the head of state, the programs on integrated development should drastically change the looks of many cities across the country. The most advanced fiber-optic communication lines have been laid even in the most remote areas of Karakalpakstan - Kungrad and Muinak Districts. All the efforts are aimed at improving people’s welfare and quality of life. “The goals and objectives we set for 2015 and subsequent years in order to continue and enhance the reforms and transformations, to ensure sustainable economic development, successive and continuous improvement of the quality of life of our people are fairly feasible and meet the interests of everybody, who lives in our holy and blessed land,” the President said. He also addressed these words basically to the population of Karakalpakstan, who have felt the support of the state in the years of independence through deeds. Most importantly, the initiatives are going to be implemented on a larger scale.

We remember how, within a generation, a humanitarian catastrophe pulled the plug on the growth of a land, destroying economic and industrial infrastructure, the agricultural sector and, most importantly, people’s fates. Dozens of industrial enterprises had to close down and the famous Muynak Cannery morphed into a defunct and desolate building, while thousands of people lost their jobs and livelihoods. Towns and villages resembled pictures of the post-apocalyptic movies. Abandoned by people and all but consumed by sands, they became the epitome of the irrepressible desire of the authorities to subdue nature at any cost.

With this burden, Karakalpakstan entered into a new life in 1991. Today, 24 years later, this region can hardly be recognized. There are new enterprises, a developing agricultural sector, growing towns and cities, and social infrastructure. Most importantly, the mentality of the local people has changed.

At the turn of the ‘90s of the past century, hardly anyone who would believe that some two decades later the devastation and desolation would give way to bustling life. The people do not just see and feel the transformations, but are actively involved in them. A group of Uzbekistan Today reporters has visited Karakalpakstan and saw the growing manufactures, schools and medical facilities, and other evidence of ongoing change. Meanwhile, the new hope in the people’s eyes, which they lost 50 years ago, is perhaps the main factor of the successfully chosen development path.

However, it is too early to say that the region has turned into a developed industrial, cultural and tourist hub. There is still much to be done, as President Islam Karimov emphasized addressing the participants of an international conference on the Aral Sea disaster. Setting priorities is vital. Karakalpakstan has several key advantages, and a strong focus on the development of these advantages may yield fruits in the near future. Seen as a kind of a key to the region’s wealth, the transport infrastructure ranks among the key factors of development.

The Transport Effect

Any logistics expert would say for sure that no industrial production or attractive tourist brand can be created without an appropriate transport infrastructure. It’s not just about building a network of road, railway and air communication, but their effective interaction that makes all means of transportation complement each other, offering a broad range of services to businessmen or travelers, depending on their preferences and paying capacity. The issue is especially relevant for Karakalpakstan due to its vast territory, making up 37.1% of the country’s total area, and harsh natural conditions. The most populated areas are surrounded by Kyzylkum, Aralkum and Karakum deserts. Under such conditions, the accessibility becomes a vital factor in the region’s development, as well as a convenient geographical location. Since ancient times, this area was situated on the crossroads of trade routes connecting Europe, Asia and the Middle East. For many centuries they promoted the development of a unique culture, which still fascinates tourists.

Road transportation proves key in cargo hauling in Karakalpakstan. The developed road network allows industrial companies to deliver their products to other regions of Uzbekistan and neighboring countries. It is envisaged to invest more than 50 billion soums in the construction and reconstruction of sections of the major throughway A-380 Guzar-Bukhara-Nukus-Beynau this year alone. Another 15 billion soums will be allocated for the expansion of the transit capacity of the roads, that is, shifting from 10-ton axle load to 13 tons. The expert community is also discussing the capacity of international transport corridor North-South, which would connect trade spaces of the Baltic States, Russia, Central and South Asia, Iran, Pakistan and India.

Partnership in the Name of the Future

Uzbekistan has invested considerably in the development of all means of communication. Experts anticipate their expansion owing to the rapid development of public and private partnerships. Representatives of domestic business and foreign investors have been increasingly drawing their attention to the northern bastion of Uzbekistan through establishing advanced manufactures there. This is quite reasonable in the light of benefits and preferences provided by the government. For example, the businesses that operate in the food, silk, electrical, light and chemical industries, pharmaceutics and building materials industries, are exempt from paying taxes on income, wealth, social infrastructure and landscaping, single tax for micro and small enterprises, as well as mandatory contributions to the Republican Road Fund. However, the benefits are not a gift, but a motivation, since investors receive them under certain terms, including, for example, investment in the further extension of the production by means of the funds released under benefit-based terms.

The authorities realize that installation of up-to-date equipment at enterprises is insufficient for their active development, so they do their best to pay due regard to new industrial facilities when working out communication projects. There is a respective regulation which envisages state budget funding for the construction of external and off-site engineering and communication networks in regard to the investment projects worth more than $50 million with the foreign investment share not less than 50%. It is vividly exemplified by the synergies on the construction of a unique Ustyurt Gas Chemical Complex.

Natural resources of the region are another driving force for the industrial development. In addition to the diversity of raw materials for the production of a wide range of construction materials, the region, according to experts, is endowed with hydrocarbon reserves. It stands to reason that Ustyurt plateau is being explored by the world’s leading oil and gas concerns like Lukoil (Russia), CNPC (China), PVEP (Vietnam), as well as the Uzbekneftegaz National Holding Company.

Industry and communication rank among the key development areas in Karakalpakstan. Meanwhile, some experts view tourism as an equally important direction. The reason is quite simple: the annual flow of hundreds of thousands of tourists to the region would create several times more jobs than most advanced industrial facilities. They would engage women and young people, the most vulnerable segments of the population in terms of job security. On the other hand, impressed by trips to Karakalpakstan, thousands of travelers are an excellent PR tool, they are human emotions shared with other foreigners, thus promoting the domestic brand in international markets.

This means that the region is likely to get some additional investment.

There is much to show – rich customs and traditions of the Karakalpak people, well-known handicrafts made of wood and leather, weaving and embroidery. To boot, Karakalpakstan is an open-air archeological reserve. Destiny has created a unique tourist product, a synthesis of ancient culture, which is represented by over 300 buildings and fortresses, as well as the ecological disaster created by a boundless human will, a ship graveyard and a famous statue of a fisherman. These awe-inspiring ‘attractions’ draw as many tourists as do their famous counterparts in Samarkand, Bukhara, and Khiva.

... A thousand and one opportunities of Karakalpakstan are backed by fates of thousands of people living in tough conditions. Most importantly, there is a light of hope in their eyes, the hope which was instilled by the independent development of the republic.

(Source: «Uzbekistan Today» newspaper)


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