About 1,000 members of Uzbekistan’s business community assembled late last week at a Tashkent conference hall to parley with the Interior Ministry, tax officials and the General Prosecutor’s Office about how to protect themselves from the threat of corruption.
News of the event, which took place on October 27, was broadcast on the state evening news and several internet sites and newspapers.
The spur for dialogue came in the form of a decree signed by acting President Shavkat Mirziyoyev earlier in the month intended to ensure “the rapid development of business, protection of private property and the qualitative improvement of the business climate.” Improving life for private enterprise appears to be one of the many promises of reset being dangled before Uzbeks since the death of the late President Islam Karimov.
While television and state newspaper reports about the conference were skimpy on the details, online outlets delved a little further. For example, Gazeta.uz cited the chairman of the State Tax Committee, Botir Parpiyev, as admitting to the proliferation of unauthorized inspections on companies and that these were harming the prospects of business development in the country. A starling admission by anybody’s standards.
“According to [State Tax Committee] data, an average of about 4,000 unscheduled inspections were carried out in Uzbekistan [NB: no timeframe provided],” Gazeta.uz reported, citing Parpiyev. “More than 1,500 case files were sent for investigation.”
Parpiyev carried on to say that 200 companies are closing yearly as a result of these unannounced inspections, causing damages worth several million dollars in total.
“This has created major inconveniences and halted the operations of companies and the delay of salary payment to employees,” Parpiyev said.
Uzbekistan’s acting president Shavkat Mirziyoyev has ratified the International Labour Organization’s Convention No. 87, formally recognizing freedoms of association and the protection of the right to organize.
Tashkent’s prior resistance to adopting the convention has been linked to repressive practices in the country’s cotton industry, which involves the forcible annual mobilization of state workers for weeks of grueling labor in the fields during harvest season.
On the face of it, Uzbekistan adoption of this international standard fits into Tashkent’s ongoing charm offensive following the death of President Islam Karimov in September. The government has been working hard in recent years to persuade the international community that it is attempting to address some of its more unsavory practices.
Still, the significance of a largely bureaucratic move should not be overstated before results are seen and Karimov’s passing was likely only incidental to the development. Uzbekistan’s adoption of Convention No. 87 has been a few years in arriving. Tashkent signed a memorandum of understanding with the ILO in April 2014 committing it in principle to ratification this year.
In July, even prior to Karimov’s death, Mirziyoyev told a government meeting that during this year’s cotton harvest campaign, no school or university students were to be sent out into the fields. The remarks were intended in part to salve the concerns of the ILO, which is now implementing a inspection regime designed to detect abuses. But there is strong evidence to suggest that despite those exhortations, many students were press-ganged into cotton-picking all the same.
Uzbekistan’s currency has taken a severe battering on the black market over the past week.
Back on October 22, unofficial currency traders in the capital, Tashkent, were buying dollars at around 6,400 sum. The rate as of the start of the week was just shy of 7,000 sum — although as a testament to the volatility of the currency, rates have been regaining their positions toward the end of each working day. By the close of business on October 25, the rate was 6,600 sum.
“Because of the spike in dollar rates, people have stopped selling their foreign currency and almost nobody buys it,” one black market trader called Bahrom told EurasiaNet.org. Bahrom said the sudden downward pressure on the sum was the result of the price increase for automobile gas announced by the authorities over the weekend.
Transactions in the gasoline market are largely carried out in dollars. State energy company Uzbekbeftegaz buys large amounts of fuel in Kazakhstan and Russia and pays for it in dollars. Private owners of gas stations in Uzbekistan also use the US currency to purchase their supplies.
The official exchange rate has also been registered some fluctuations, albeit only minute ones since the government is typically reluctant to admit to weaknesses in the economy. The rate last week was 3,065 sum to the dollar, but that has gone up to 3,084 sum.
Black market currency trader Rasul told EurasiaNet.org that he believes the street value of the sum could possibly break through the 7,000 psychological barrier by the end of the year, which would result in a fresh round of price increases for groceries. Other traders remain confident the sum could stay around the 6,700 figure, however.
A delegation of senior officials from Uzbekistan has paid a visit to neighboring Kyrgyzstan, reciprocating a trip earlier this month that presaged a possible thaw in relations between the two nations.
The 47-person delegation that traveled to Krygyzstan’s Osh region on October 26 was led by Uzbek deputy Prime Minister Adham Ikramov and also comprised the heads of the Andijan, Namangan and Ferghana regions, representatives of several government agencies, including the National Security Service, and members of the Kyrgyz diaspora.
As happened during the visit to Uzbekistan in early October, the officials passed through the Dustlik (“Friendship”) border crossing, which sits adjacent to Osh and has lain unused for many years.
So far, these encounters have focused primarily on pleasantries. The Kyrgyz hosts laid on a series of cultural events under the gaze of the giant statue of Vladimir Lenin in the center of Osh.
"During the visit, the delegation visited Osh State University, where they learned about the activities of the medicine faculty. Addressing the students, Adham Ikramov spoke of the inviolability of friendship and good neighborliness between the two countries. He stressed that good neighborly relations between Uzbekistan and Kyrgyzstan should become a cornerstone for the further development of joint cooperation,” Uzbek news website gazeta.uz reported.
Uzbekistan’s national energy company has announced a sharp increase in prices for car gasoline while offering assurances it will camp down on the speculation that has made the real cost of buying fuel even greater.
In what it cast as a response to public dissatisfaction over the situation with gasoline, Uzbekneftegaz on October 22 announced that as of this week the cost of most basic and popular type of gas — AI-80 — has been set at 2,800 sum ($0.90) per liter, up from 2,075 sum.
The price for higher grade AI-91/92/93 fuels has been set at around 3,000 sum and the highest available grade, AI-95, will sell at 3,300 sum per liter.
Those prices are only a fantasy for many Uzbek motorists gouged by middlemen, many of whom obtain fuel from the capital, Tashkent, and sell it in the provinces at between 3,000 and 5,000 sum per liter. Uzbekneftegaz said it is ensuring all gas stations stick to the officially decreed prices.
Even before the price rise was announced, Tashkent had already recorded notable shortages in fuel at gas stations. The sight of large numbers of motorists lining up a fuel retailers in the hope of getting some gas is recurrent feature of this time of year. Gas stations sell fuel until around 11 o’clock in the morning and then close their doors until the next day.
Fuel shortages typically occur in Uzbekistan around the start of December, but the deficits are being seen earlier this year. Uzbekneftegaz is allocated money annually by the government to import fuel, but the amount purchased is never enough to get through to the end of the year.
Under the late President Islam Karimov, the government in Uzbekistan boasted unconvincingly about its record on job creation. And that was despite the million of people forced to leave the country to find work elsewhere.
In an acknowledgement that not all is well on the labor front, Tashkent is now angling for a $100 million loan from the World Bank for a five-year program to create 500,000 new jobs.
The proposed line of credit is seen as part of the World Bank’s new Country Partnership Framework for Uzbekistan for 2016-2020, which was the focus of discussion last week during a visit to the country from the lender’s recently appointed director for Central Asia, Lilia Burunciuc.
The official unemployment rate in Uzbekistan in the first half of 2016 was 5.2 percent of the active population, or around 720,000 people. Government data in Uzbekistan is notoriously unreliable, but the figure may indeed be relatively contained due to migration. Around three to four million Uzbeks currently live and work abroad, mainly in Russia, because of a lack of jobs inside the country. Karimov’s unemployment-busting strategies typically focused on reliance on internal resources, and they have returned disappointing results.
Still, the would-be jobs to be created with the hoped-for World Bank support are not yet defined and the $100 million sum looks far too small to realistically generate that level of economic activity.
An official delegation headed by Kyrgyzstan’s deputy prime minister visited Uzbekistan’s Andijan region on October 1 for a visit that observers of the region hope could break a pattern of frosty relations.
News website Gazeta.uz reported that Muhammetkaly Abulgaziev led a delegation of around 130 government officials, “cultural representatives” and youth groups. State officials included representatives from the regions bordering Uzbekistan — Osh, Batken and Jalal-Abad — and the mayor of Osh city, Aitmamat Kadyrbayev.
The large group of guests was ceremonially greeted by deputy Uzbek prime minister Adham Ikramov at the Dustlik (“Friendship”) border crossing in Uzbekistan’s Khodjaobad district, which sits adjacent to Osh and has lain unused for many years.
During the one-day tour, the visiting delegation was taken to see a museum devoted to celebrated medieval poet and son of Andijan, Zahiriddin Muhammad Babur, a local university, the premises of a freshly built train station and the General Motors Uzbekistan manufacturing plant.
RFE/RL’s Uzbek service, Ozodlik, reported that the trip concluded with the obligatory sealing of a memorandum of mutual cooperation that was signed by neighboring regions of both countries. A concert then followed.
Uzbek youth movement Kamolot uploaded video footage of an address by the visiting Kyrgyz onto its website entitled “Hello Uzbekistan!” In the video, one woman in her sixties, spoke in Kyrgyz to say that this was the first ever such high-ranking delegation to visit Andijan region.
Uzbekistan’s acting president Shavkat Mirziyoyev has been busily touring the regions and vowing to improve people’s lives as he tries to bolster his legitimacy ahead of December 4 elections.
In concrete terms, Mirziyoyev is pledging to build homes, improve provision of household electricity and gas, and create a more efficient transportation system. Although his victory in the December 4 presidential election is not in any doubt, Mirziyoyev is energetically trying to raise his public profile and have it associated with major, life-enhancing infrastructure.
On October 1, while he was in the Syrdarya region, around 100 kilometers outside Tashkent, the acting leader visited a power station that serves as the largest provider of electricity for central Uzbekistan.
He then traveled to the regional capital, Gulistan, and dropped in on the building site of a multistory residential complex intended for hard-off families. A state television report showed Mirziyoyev stressing that the apartments were being provided to buyers on preferential loan terms and that they should be distributed fairly to those in need.
All the way in the far western edge of Uzbekistan, in the officially autonomous Republic of Karakalpakstan, Mirziyoyev demanded that works be speeded up to modernize the Takhiatash thermal power station.
“Without completion of this project, the development of industry in Karakalpakstan and Khorezm will not be possible — it is necessary to speed us this project, which is important for the region,” he said.
When Uzbekistan’s acting president Shavkat Mirziyoyev addressed a joint session of parliament earlier this month, he made a point of saying that his foreign policy priority was to boost relations with regional neighbors.
"We always remain committed to adopting an open, friendly and pragmatic position toward our immediate neighbors — Turkmenistan, Kazakhstan, Kyrgyzstan, Tajikistan," Mirziyoyev said.
Since even before the collapse of the Soviet Union, leaders in Central Asia have been paying lip service to the notion of fostering fraternal ties in the region, but Mirziyoyev has tentatively lived up to his word in small if meaningful ways so far.
In an apparent start at trying to mend fences, Uzbek Foreign Minister Abdulaziz Komilov on September 29 visited Tajikistan, where he met with President Emomali Rahmon.
Discussions were confined to what might sound like meaningless generalities anywhere else. For these two countries, however, talk of positive trends in relations, increased trade, revitalized dialogue on trade and economic cooperation and “the importance of maintaining regular political consultations and dialogue at the highest levels” are more than noteworthy.
Rahmon and Karimov’s relationship was fraught by personal enmity, making reaching state-level agreement on a number of thorny sticking points — of which there are many — all the more difficult.
The biggest source of bilateral unease lies in Dushanbe’s determination to build the giant Roghun hydropower plant, which Tashkent has loudly complained will pose a potentially existential risk to its agricultural sector by stemming the flow of a major river.
There is no area of public life in Uzbekistan that can remain untouched by cotton.
With the end of September approaching, the harvesting season is in full swing and all available hands are being enlisted to the cause: teachers, students, doctors, scientists and conscripts.
And on Friday, imams all across the country used prayer day sermons to urge parishioners to go out into the fields as well. The imam at a mosque in the Kashakadarya region, Bobohon Abdurahimov, said the Muslim Board of Uzbekistan distributed specific instructions on appeals to get the faithful to participate in the gathering of raw cotton.
“We explain to the faithful … that the gathering of cotton is a major state-level concern. Cotton is our national pride, that is why need an all-nation khashar (voluntary collective works drive) — a joint effort for the good of society. Muslims will please God if they help the state and farmers,” Abdurahimov told EurasiaNet.org.
At the largest mosques in Tashkent, worshippers can contribute to the harvest by providing donations, which are then used to provide for some of the cotton-pickers’ needs.
Asked if the sermons have any impact, Abdurahimov said that different people respond in different ways. Some limit themselves to making financial donations to help the cause, while others send one of their relatives to the fields. And then there are some very passive Muslims who take no heed whatsoever, he said.
According to Uzbekistan’s constitution, religious institutions are separate from the state, but in reality, the activities of faith organizations are strictly monitored and directed by security organs.