What Role Do Economic Conferences Play in Uzbekistan’s Development?
Back in November, I travelled to Samarkand to attend the Uzbekistan Economic Forum. I had been to the ancient city nearly a dozen times, but this was my first professional event there. The Uzbekistan Economic Forum did not suddenly convince everyone that Uzbekistan is a special country. But it did show that Uzbekistan was becoming a more normal one.
Not everyone in Uzbekistan was happy with the conference. Some journalists and bloggers questioned why Uzbekistan’s government needed to convene yet another major and costly event. Others wondered if the return on investment would be worth it. Concerningly, the costs of the forum were not disclosed. Clearly, the organisers could have done a better job in publicly communicating the rationale for such a large event and why such conferences matter. To me, there are three reasons why they do.
First, Uzbekistan needs to foster regular dialogue with businesses partners, investors, and lenders who are independent from the government. Such actors are accountable to their shareholders, are subject to intense international media scrutiny, and must follow varied regulations around governance and sustainibility. Therefore, they can audit Uzbekistan’s achievements and shortcomings more honestly, generating important information for local media and civil society.
A country whose debt burden is equal to 40 percent of its economic output must be open to scrutiny of its economic policies and institutions. The forum’s thoughtful programme presented the opportunity for such scrutiny, with topics ranging from political reforms to economic inclusivity. The organizers brought in people who could ask tough questions (including former CNN and Bloomberg journalists) as chairpersons for the panel discussions. Senior representatives from the IMF, IFC, World Bank, European Bank for Reconstruction and Development (EBRD), Asian Development Bank, Asian Infrastructure and Investments Bank, regional central bankers, financiers, investors, and many consultants featured on these panels.
There was a time when frankness came at a cost. In May 2003, panelists from the EBRD, which was leading Uzbekistan through its protracted post-communist transition, spoke truthfully about the country’s economic and political shortcomings at the Annual Meeting in Tashkent. By 2005, EBRD war hardly making any loans in Uzbekistan and by 2007 it had exited the country altogether, unable to operate in an environment in which the authorities demanded deference. It was not until a decade later that EBRD returned to Uzbekistan. Today, the bank has 65 active projects with over EUR 2 billion in total portfolio value. With that much at stake, it is reasonable to expect that the EBRD and peer institutions will continue to speak up, especially as its activists continue to push the bank to live-up to its pro-democracy mandate.
Second, Uzbekistan needs a platform to prove its bureaucratic capacity, as it seeks to stay the course of increasingly difficult structural reforms. In contrast to heavily protocolled political events with predetermined outcomes such as the Shanghai Cooperation Organization or Inter-Parliamentary Assembly, participants of economic forums in Uzbekistan are more demanding, represent diverse stakeholders, and care about performance dynamics. The newly formed Ministry of Economy and Finance, the Ministry of Labor and Poverty Reduction, and the Ministry of Justice—which oversee social policy—face new challenges every day. The nominally independent Central Bank and the judiciary are undergoing significant changes with unclear outcomes. They will all need to prove that they can uphold Uzbekistan’s domestic and international commitments and pay the bills.
At the same time, reform-minded public administrators themselves need businesses, civil society groups, and international professionals to get their president's attention in the highly centralized system. In Uzbekistan, the presidential administration can be reactive, prioritizing issues in response to media coverage, expert commentary, formal reports, and face-to-face meetings. It is no secret that certain business leaders may enjoy better access to the president that many ministers do not have. So, it is good when investors are both long-term thinkers and legally bound to seek clean deals. These investors and reform-minded public administrators can form coalitions as part of two-level game through which domestic reformers in transition economies find the means with which to amplify their voices.
Alongside many countries “stuck in transition,” the Uzbek government continues to face challenges outlined by the IMF in its 2014 review marking 25 years after the end of communism in Europe. Uzbekistan needs to reign in its exorbitant public expenditures, improve the business climate, enable market competition, enforce state divestment, and ensure rule of law. It was reassuring that almost all keynote speakers in Samarkand said the same. By the end of the first day (most discussions can be watched freely online), it was clear that there was broad consensus about what needs to happen to enable prosperity.
The Uzbek ministers and senior officials speaking at the conference shared this consensus and acknowledged problems. Some even joked, earning sincere laughter from the diverse audience. Importantly, the conference was held in Uzbek and English — this was more than political symbolism. Russia’s war on Ukraine has had varied effects on the Uzbek economy. These have been mostly negative (e.g. reduced financial inflows and increased social policy burden), though there have been a few silver linings (e.g. capital relocation, higher commodity prices, and parallel exports). After independence, Uzbekistan, like other post-Soviet states, pursued legislative and regulatory harmonisation with Moscow. But the country’s bureaucracy is starting to look beyond Russia. The use of the Uzbek language helps the central government connect to a wider swath of society. The use of English, meanwhile, represents a search for a wider cooperation with foreign countries.
Finally, these conferences help set expectations—and there are many expectations being set. That Uzbekistan will privatise the promised 1,000 more state-owned enterprises. That utility and energy prices will be liberalized. That the economic growth will be increasingly supported by foreign direct investment rather than direct borrowing. That more will be done to empower and separate the judiciary from the executive branches. That the Oliy Majlis, Uzbekistan’s legislature, will pass new competition law and that it will be signed. That Uzbek GDP will rise to USD 100 billion by 2026 and USD 160 billion by 2030. That the country embraces a free market economy, trusting that its people can achieve more with less state intervention. Whether Uzbekistan meets these high expectations is something that can be assessed when it is time to gather for another forum.
Uzbekistan is seeking a dialogue with the world. We can quibble about the optics of such conferences, but they do serve to build trust and generate credibility. There was a time when economic conferences in Uzbekistan had long titles, glorified the present, and discussed the future in only abstract terms. Back then, the desired outcome was applause—those conferences played no role in the country’s economic development. In Samarkand, a different kind of conference took place.
Photo: Uzbekistan Economic Forum
