Page 24 - bne_March2019_20190306 magazine

24 I Cover story bne March 2019
Uzbek car output up by 38.8% y/y in January 2019
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Uzbekistan produced over 17,460 passenger vehicles in January 2019, up by 38.8% compared to January 2018, according to the latest figures from the State Statistics Committee of Uzbekistan.
The rise in output is in line with the Uzbek government’s plans to ramp up exports of vehicles and car parts to $118.6mn in 2019, up from $25.5mn
in 2019. The country’s main car producer GM Uzbekistan, which became 100%-state-owned in December 2018, produced 220,667 vehicles in 2018; that figure stood at 82,000 units in 2017, according previous media reports.
Production of car engines in Uzbekistan surged by 78.1% y/y to 16,430 units in January 2019, the figures showed.
The Central Asian nation’s production of trucks and buses grew 2.1-fold to 367 units and 1.9-fold to 74, respectively.
GM held a 25% stake in the Uzbek automaker before state-run Uzavtosanoat bought two-fifths of that stake in June 2018, bringing its stake to 85%. In late December, Uzavtosanoat bought out GM’s remaining shares, making GM Uzbekistan 100% state-run.
One of GM Uzbekistan’s main export destinations is Russia. Uzbekistan’s car exports have often stood as a barometer of trade flows between the two countries. However, not a single Ravon model car - a model intended for export - was sold on the Russian market throughout the July-December period of last year.
It appears there were “financial troubles” at the company, Russia news website Newstes reported last month. The report added that the sales would resume this year, citing company representative Umidjan Salimov, who noted that a new batch of Ravon cars was due to arrive in Russia.
The sudden collapse in car sales started in April 2018 when Uzbekistan sold 33% fewer cars than in April 2017. The plunge in sales also appeared to coincide with news from June that the Uzbek government was in the process of buying out GM’s stake in GM Uzbekistan.
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in to developing the sector and offered extremely generous investment incen- tives to any firm that is willing to come and build the hotels during a recent investment forum in Berlin that are largely missing from the country now.
Local media report that Kuwait-head- quartered Alshaya Group is interested the possibility of privatising Uzbek hotels, including the iconic Soviet-era “Uzbekistan” hotel in the heart of Tashkent, as well as constructing
new hotels in the ex-Soviet country.
The Central Asian nation currently has 910 hotel and accommodation facili- ties – the authorities hope to expand the number of hotels to 3,000 by 2025 due to an increasing inflow of tourists following the introduction of visa free regimes to multiple countries. The number of tourists visiting Uzbekistan in 2018 rose to 5.3mn, up from the 2.7mn recorded in 2017.
Among other potential foreign invest- ment projects, Russia’s MetProm is set to construct a 286mn Tashkent Metallurgi- cal Plant (TMZ) by December 2019. Its construction is partially funded by Rosex- imbank. A number of Russian companies, including Uralkran, Energoavangard, Veza, Promtreydimpeks, South Ural Plant and Permglavsnab, signed contracts to supply equipment for the new plant, the press service of TMZ said in a statement recently. After reaching full capacity,
the plant will annually produce 500,000 tonnes of cold-rolled metal.
“The project is financed by a foreign investor, the Fund for Reconstruction and Development of Uzbekistan, and the loan funds of Roseximbank. Credit lines pass through Asaka and Uzpromstroy- bank. These funds are allocated under the insurance coverage of the Russian Agency for Insurance EXIAR," the techni- cal director of MetProm, Valery Osin, was quoted as saying in local media.
The number of foreign investment projects in Uzbekistan are likely to keep expanding as the country continues
its reform-drive, including plans
to privatise its flagship gold producer Navoi Mining and Metallurgical Company (NMMC).