EMBASSY OF UZBEKISTAN TO THE UNITED STATES
PRESS OF UZBEKISTAN
2017
2016
2015

 
PRESS OF UZBEKISTAN
February 28, 2017
PRESENT PACE OF SMALL ECONOMY
Having embarked on the path to independence and adhering to own model of economic development, Uzbekistan for historically short term has achieved great success which cause admiration and never ceases to amaze the world community. It became an integral part of world community and the global financial and economic market, the member of the UN, cooperates successfully with many international institutes and the organizations, it has on its territory of the embassy, diplomatic and other representative offices of many countries. takes necessary measures for improving level and quality of population's life.

Official statistics shows that over the years of independence the population of Uzbekistan has increased by almost 11 million, maternal and child mortality has decreased more than by 3 times, average life expectancy of the population has grown from 68 to 75 years. Such fatal changes as not the statistics, but international experience testifies now, occur or can occur only in those countries where everything is being done to grow economy and for the human benefit, but not vice versa in any way. Uzbekistan, fortunately, is among such countries where interests of people are put in the first place.

Important result of economic reforms and institutional transformations is reinstating and transferring property to its true owners in the order established by the legislation, strengthening of non-state sector, developing the sphere of small business and private entrepreneurship which is called "small" economy today. The main production subjects of this sphere are small enterprises and micro firms. They are considered to be maneuverable, rather manageable, less capital-intensive and reacting quickly to market condition. Showing very productive work, small enterprises and micro firms often and to some extent act as competitors for the large enterprises. It is especially noticeable in such spheres as processing of agricultural production, secondary resources, manufacturing of furniture, various types of construction materials, footwear, clothe and other products.

Another remarkable feature of small enterprises is ability to adapt quickly to local conditions, customs and traditions. This quality allows them to find the wide field of activity in the sphere of goods and services the local population has traditionally got used. These are, for example, such spheres as handicraft, decorative art production, production of knives, stamping products, articles of needlework and embroidery, agricultural and house tools, as well as manufacturing of national food products. Subjects of "small" economy can be created and function on the basis of all existing forms of ownership, such as state, private, collective and other forms, and their founders may be not one, but several legal entities and individuals. They have the right to establish independently volumes and the range of production, to sell it at their discretion, to price goods, works and services, to define forms and size of hired workers salary, profit (income) allocation, etc. The "small" economy forming powerful layer of owners in the country and being the main source of growth of the income and employment of the population, increases the pace year by year. So, the share of small business has increased over the period from 2000 to 2015 in the industry from 12,9 to 40,6%, construction from 38,4 to 66,7, investments from 15,4 to 35,8, export from 10,2 to 27,8%.

Nowdays the enterprises of "small" economy make up to 45% industrial products, 98% of agricultural products and about 57% of the gross domestic product (GDP) of the country. The number of the employees in this sphere has reached about 78% of the general employment in economy. If in the early 90-s of the previous century the share of the income from business activity in structure of the population income made about 10%, nowadays its specific weight has increased up to 52% that considerably exceeds a similar indicator in the CIS countries. Great opportunities for development of business and entrepreneurship are opened by transfer of the state objects at "zero" value to private owners provided they undertake certain investment commitments. In 2015 the state-owned assets invested in the private sector exceeded 3 times assets allocated in 2014. For 570 state-owned assets realized at "zero" redemption value, investors have taken commitments worth 971,5 billion Soums (currency rates of CB RU from 28.02.2017, 1$= 3404.35 soums) and $49,3 million . Thanks to it the production potential of economy has increased to a certain extent, on the basis of the idle facilities advanced hi-tech productions appeared, new jobs were created. This positive process continued to occur in past 2016. Within nine months the private sector has purchased 373 state-owned assets with investment commitments for almost 314 billion Soums. 45 joint-stock companies (JSC) have sold state shares of over 15% of authorized capital of these companies to foreign investors that, among other things, has significantly reduced the number of the joint-stock companies with the state share in authorized capitals. It demonstrates another not less important change which happens in the republic today: the state really seeks to reduce its presence at economy, to develop and bring democratic foundations and the vital principles of society to new level, to joint faster the ranks of high developed countries of the world. The sphere of business and entrepreneurship is supported by many institutes, in particular, commercial banks. So, for example, last year only Ipoteka-bank of the country has allocated the credits worth over 993 billion Soums to small business and private entrepreneurship, and total volume of micro credits made 241,2 billion Soums. The bank has financed projects of 76 enterprises producing construction materials and tools worth 30,1 billion Soums. As a result, the enterprises of "small" economy, besides progress in production of goods and services, their sale, have increased the potential due to creating 17 thousand new jobs. Other banks also grant the similar support to small business. Thus, the "Microcreditbank" Joint stock bank this year intends to allocate the credits worth 1 trillion and 260 billion Soums for development of small business and private entrepreneurship , creation of new jobs, granting the bigger volume of banking services to population , especially to women and college graduates. At the same time the bank assumes to bring the volume of the loan portfolio up to 1 trillion and 370 billion Soums.

The first President of the republic Islam Karimov paid much attention to small business and private entrepreneurship and considered that neither society nor the state could successfully develop without them. One of his books "Strengthening spirit of Business in Society is the Guarantee of Progress" stresses: "We have to consider small business, private entrepreneurship as the factor providing the accelerated economic development of our republic. With the private, non-state sector manufacturing the main part of the production output, we can say safely that the economy became originally free and had found its future". The present country leadership, continuing and improving the chosen economic course, gives to development of "small" economy not less but more attention. The evidence is the Decree of the current President of Uzbekistan Shavkat Mirziyoev of October 5, 2016 "On additional measures to ensure the accelerated development of entrepreneurial activity, comprehensive protection of private property and substantial improvement of business climate". The measures provided in this document open the new horizons for business and entrepreneurship, counteract manifestation of any kind of bureaucracy and obstacles in this sphere, provide various privileges and preferences. It means that the state supports any positive aspirations of the existing and especially beginning businessmen if they don't contradict the current legislation and are aimed not only at the personal benefit, but also wellbeing of a family, society and state.

In conclusion, today, especially the context of the goals set by the President Shavkat Mirziyoev at the enlarged meeting of the government dedicated to the socio-economic development of the country in 2016 and the most important priority directions of the economic program for 2017 requires, first of all, high-quality shifts in economy including in "small" one. For this purpose it is important to enhance a role of local authorities, first of all, the hokimiyat which are responsible for developing economy in regions, including for developing small business and private entrepreneurship. Business has to develop in regions not by the residual principle, but on an equal basis with development of the industry, construction, transport and other branches and industries or in the context of the latter.

Both large manufacturing enterprises and associations which shouldn't become isolated within the departmental or corporate interests have to tell "word" here, and open the wide road to creation of small enterprises, including those in form of branches, subsidiaries and other acceptable structures as it is widely practiced in many developed countries. Undoubtedly, there are other opportunities for our domestic business to gain a civilized basis, to develop and increase the pace successfully. A framework of article doesn't allow to cover and describe all opportunities. But, it would be desirable to tell about one aspect of this important issue which the President at the above meeting of the government has paid special attention to. It is firstly, personal responsibility of leaders of all ranks for the end results of work, secondly, general providing an accurate order and strong discipline and, thirdly eradiation of negative effects in the work. Implementation of these requirements is an important condition not only for increasing potential of "small" business, but also realizing tasks defined for 2017 and the subsequent periods.

(Source: «Business partner.uz» newspaper)


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