Uzbekistan: Selected Trade and Economic Issues

12-09-2013

Uzbekistan is the Central Asia Republic that suffered the less from the collapse of Soviet Union. GDP was restored to pre-independence levels as early as 2002, and the country has since enjoyed a protracted phase of sustained economic growth. Uzbekistan is currently a medium-low income country, and living conditions in the country have significantly improved, though mainly in urban areas. Regional and social disparities are high. Rather than liberalise its economy and adopt the economic reforms suggested by international financial institutions, Uzbekistan has preferred to set-up a system based on import substitution under strict state control. This has had the merit of protecting the country from external shocks but has also led to a relatively inefficient system where state interference in the economy is the rule rather than the exception. The external trade sector is largely dominated by gas, gold and cotton exports, and exchanges with the European Union are very limited. The EU signed a Partnership and Cooperation Agreement with Uzbekistan in 1999. The European Parliament opposed to the ratification of a protocol extending PCA provisions to the textile sector, initialled in 2010, because of persistent and serious exploitation of child labour in the Uzbek cotton sector.

Uzbekistan is the Central Asia Republic that suffered the less from the collapse of Soviet Union. GDP was restored to pre-independence levels as early as 2002, and the country has since enjoyed a protracted phase of sustained economic growth. Uzbekistan is currently a medium-low income country, and living conditions in the country have significantly improved, though mainly in urban areas. Regional and social disparities are high. Rather than liberalise its economy and adopt the economic reforms suggested by international financial institutions, Uzbekistan has preferred to set-up a system based on import substitution under strict state control. This has had the merit of protecting the country from external shocks but has also led to a relatively inefficient system where state interference in the economy is the rule rather than the exception. The external trade sector is largely dominated by gas, gold and cotton exports, and exchanges with the European Union are very limited. The EU signed a Partnership and Cooperation Agreement with Uzbekistan in 1999. The European Parliament opposed to the ratification of a protocol extending PCA provisions to the textile sector, initialled in 2010, because of persistent and serious exploitation of child labour in the Uzbek cotton sector.