Estudios Económicos


Population 34.6 million
GDP 2,002 US$
Country risk assessment
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major macro economic indicators

  2020 2021 2022 (e) 2023 (f)
GDP growth (%) 1.6 7.4 5.7 4.8
Inflation (yearly average, %) 12.9 10.8 11.4 10.0
Budget balance (% GDP) -3.3 -4.7 -4.0 -3.5
Current account balance (% GDP) -5.4 -7.0 -1.5 -3.7
Public debt (% GDP) 37.6 35.8 34.2 33.4

(e): Estimate (f): Forecast  *Balance including off-budgeted public expenditures financed by borrowing


  • Abundant natural resources (gas, gold, copper, hydroelectric potential)
  • Economic reforms, public investment and international financial support encouraging FDI
  • Low public debt and substantial foreign exchange reserves
  • Managed floating exchange rate regime
  • Negotiation process to join the World Trade Organization and observer member of the Eurasian Economic Union
  • Enhanced Partnership and Cooperation Agreement with the European Union and various bilateral agreements


  • Dependence on Russia and China
  • Dependence on commodities, weather conditions for agriculture and expatriate remittances
  • Weakly competitive markets and low share of the private sector in the economy
  • High unemployment, low standard of living, large rural population and informal economy
  • Low financial intermediation, high dollarization
  • Tensions between the central power and the population of the western region of Karakalpakstan

Risk Assessment 

Slower growth in 2023

Growth will soften in 2023. Final consumption, the main item of GDP (76% of GDP in 2021) will continue to be weakened by persistent inflation. Real wages may not increase at the same rate as inflation, which will erode household purchasing power. The deteriorating economic situation in the Russian Federation will generate fewer remittances from expatriates settled there (56% of transfers) thereby impacting household consumption and GDP. In 2021, transfers from expatriates represented 13% of GDP. Gross fixed capital formation (35% of GDP in 2021) will positively impact GDP, while the impact of net exports will be negative. Since 2019, more than 40% of fixed asset investments have been made using foreign loans and investments and this trend will remain unchanged in 2023. Nearly half of these investments (48% in 2021) involve the purchase of machinery and equipment. The share of foreign direct investment in GDP (3% in 2021) will remain low. Net exports will contribute negatively to growth, but the degree will depend on Uzbekistan's trade with Russia. The Central Bank of Uzbekistan (CBU) operates a highly controlled floating exchange rate. The policy rate is currently set at 15% which, according to the CBU, is sufficient to maintain moderately tight monetary conditions in the economy. The effectiveness of the country’s monetary policy is restricted by low financialisation.

Current balance dependent on expatriate remittances and intention to trim the budget deficit

The trade balance deficit widened in 2022, mainly resulting from an increase in the price of imports and in particular food inflation. Imports of other major categories (automotive and equipment, energy and petroleum products, and metals) also increased. Easing inflation will have a positive impact on the trade balance due to the lower price of imported goods. In 2022, Uzbekistan's exports were mainly based on gold (more than 25% of exports), the other major categories (food, chemicals, metals and energy and oil) accounted for almost 10%. The rise in gold prices since the end of 2022 should benefit exports from Uzbekistan. Uzbekistan is facing a shortage of natural gas which has pushed it to reduce or restrict its exports and to import gas from other countries. This shortage will have negative implications on the trade balance in 2023. The balance of services will contribute positively to the trade balance, in particular transport and tourism services (respectively 44 and 40% of service exports in 2022). The balance of services will contribute negatively to the trade balance, in particular transport and tourism services as well as the balance of primary incomes, resulting in particular from the repatriation of income from foreign investors. The current account balance for 2023 remains uncertain and will depend very heavily on expatriate remittances from abroad. Over the first three quarters of 2022, transfers doubled in the 2nd and 3rd quarters, allowing the current account balance to be positive for the first time since 2019 (except for the last quarter of 2021). Given Uzbekistan’s strong dependence on transfers from Russia, and the economic recession it is going through, the current account balance is likely to deteriorate.
The government’s 2023 Budget estimates a growth rate of 5.3%, which would bring the budget deficit to 3.5% of GDP. The government introduced major changes to the taxation system in 2023, such as cutting the VAT rate from 15% to 12%, and a setting a flat tax rate of 4%, rather than a floating rate of 4%-25%. From the expenditure point of view, several major items relate to social expenditure, such as education, health or culture. The government is also tacking public debt, and in particular external debt, in particular by limiting the total value of agreements signed to attract external debt in the name and under the guarantee of Uzbekistan to USD 4.5 million. The government wishes to reduce the share of public debt to 32% by 2024. However, this objective may be slowed by the need to finance the state deficit. The state resorts to loans to finance the deficit. However, inflation and high global rates are making conditions more difficult and are increasing the cost of necessary borrowing, all of which is fuelling public debt.

Controversial constitutional reform and a desire to diversify trading partners

After serving for thirteen years as Prime Minister of President Karimov who had led the country since 1991, Shavkat Mirziyoyev was elected President in September 2016 after Karimov’s death. The last presidential elections held on 24 October, 2021 saw incumbent President Mirziyoyev elected (unsurprisingly) to a second term in the face of non-existent opposition. Power remains concentrated in the hands of the President and Parliament is composed of parties supporting him. Cosmetic political reforms contrast with the many economic reforms aimed at attracting investors. This is the case of the reform introduced in mid-2020, creating a panel of judges within the Supreme Court to examine disputes with large investors and provide them with greater legal certainty.

More recently, on 6 March 2023, a final draft was prepared for the reform of the Constitution sought by Mirziyoyev as early as December 2021. A text had already been published in June 2022, but protests in July 2022 in the Republic of Karakalpakstan, an autonomous region of Uzbekistan, put the project on hold. These protests had erupted after the proposal of the President of Uzbekistan to end the autonomous status of the Karakalpakstan region and oppose its sovereignty. The Karakalpakstan region, located in the northwest of Uzbekistan, occupies 40% of its territory, but the Karakalpaks ethnic group represents only 2.2% of the country's population. Since 1993, it has been attached to Uzbekistan, but the ethnicity of its population differs from that of the rest of the country, and the spoken language is closer to Kazakh. The annexation of Karakalpakstan to Uzbekistan was initially planned for a period of 20 years, leading to the possibility of a referendum allowing the region to secede from the country. Putting an end to this status through this referendum means the region would be unable to secede from Uzbekistan. In January 2023, 22 protesters were sentenced to prison and received fines. On 14 March 2023, senators approved the new bill of the Constitution of the country. A referendum on its adoption took place on 30 April, 2023. Some 65% of the text of the current Constitution will be modified. Uzbekistan should thus be declared a “social state”, that is to say that the interests of the population must in theory be prioritised. Measures include providing housing for people in precarious situations and guaranteeing them access to healthcare. From a political point of view, the number of senators must be reduced from 100 to 65. A certain number of political positions cannot be held for more than two consecutive terms, in particular that of President of Uzbekistan, President of the Senate and the Attorney General. In addition to including amendments relating to Karakalpakstan, the duration of the presidential term will be increased to seven years, instead of the current five. This measure has been strongly criticized as it would allow Mirziyoyev to stay in power longer, since the prolonged duration would allow him to serve two new terms of office after his current one which was meant to end in 2026. Hence, despite the introduction of social measures, the Constitutional reform is perceived as a means for the current President to consolidate his own powers.
Regarding foreign relations, Uzbekistan remains highly dependent on Russia, not only in terms of expatriate remittances, but also for trade. Russia is Uzbekistan’s main trading partner, closely followed by China (with respective export revenue shares of 19% and 18% in 2022). However, Uzbekistan does not support its historical partner in the invasion of Ukraine. In March 2022, Uzbekistan recognised Ukraine’s sovereignty and did not recognise the self-proclaimed independence of the republics of Donetsk and Luhansk. Foreign Minister Abdulaziz Komilov called on both parties to find a diplomatic solution. Uzbekistan is not ready to give up its sovereignty. It notably refused to sign an agreement with Russia and Kazakhstan on the creation of a natural gas union proposed last November by Vladimir Putin. Nevertheless, in January 2023, agreements were signed between the Gazprom company and Uzbekistan on the supply of Russian gas to Uzbekistan. By September 2022, deals worth USD 4.6 billion (6% of 2021 GDP) had been signed for industrial, chemical, petrochemical and geological projects. Alongside these agreements, Uzbekistan is seeking to reduce its dependence on its main partner by growing closer to China. Also in September 2022, agreements worth USD 16 billion (23% of GDP) were signed concerning the construction of railway lines from China to Uzbekistan, crossing Kyrgyzstan. Cooperation with other Central Asian countries is also increasing. Last February, the country received 2,000 tons of liquefied gas free of charge from Turkmenistan with the aim of strengthening their partnership. In December 2022, Kazakhstan and Uzbekistan signed several investment agreements and trade contracts worth USD 8 billion. Uzbekistan is also strengthening its ties with the West, in particular with the European Union, with which a partnership and cooperation agreement was signed in July 2022, after three years of negotiations. This agreement includes political, cultural, financial and legal components. Finally, Uzbekistan maintains relations with the United States.


Last updated: September 2023

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