Page 11 - Uzbek Outlook 2024

GDP in 2024 and 3% in 2025. This will rebuild fiscal buffers to respond to potential shocks and help reduce inflation, which particularly benefits the poor.
The consolidation is to be achieved by better targeting of social benefits, cutting policy lending and reducing untargeted energy subsidies while protecting the vulnerable by introducing a social consumption norm. Removal of tax exemptions and efforts to reduce the shadow economy will complement the expenditure measures.
Improving budget planning will facilitate better outcomes with fewer resources and minimise deviations from fiscal targets. This includes strictly adhering to the budget calendar, unifying the investment budget irrespective of the financing source and preparing it together with the recurrent budget, and limiting the frequency of within-year changes, as frequent changes complicate budget execution and are unlikely to improve budget outcomes. Continued efforts to improve the measurement and management of fiscal risks, especially from SOEs and PPPs, are needed to ensure that the planned fiscal consolidation is realised.
5.0 Real Economy
5.1 Retail
A middle class is emerging in Uzbekistan as incomes rise and the first thing
they are buying is household appliances.
“Incomes are going up and one of the first things people will spend their money on is the appliances that help to make household chores a little easier. That means buying a hoover,” Bektemir Murodov, the CFO of Artel, Central Asia’s biggest maker of white goods, told bne IntelliNews in an exclusive interview.
Central Asia is coming of age and Uzbekistan, as by far the most populous country in the region, is going through a dramatic transformation since President Shavkat Mirziyoyev opened the country up to the rest of the world in 2016. It has been putting in 6% growth a year and it is rapidly embracing its role as the natural production centre for the region; Uzbekistan is by far the largest of the five ‘Stans, by virtue of its young and fast-growing population, and is the only one of the five countries in the region to have borders with all the others.
Consumer electronic sales are mushrooming in the large domestic market of 38mn consumers, the third-largest consumer market in the CIS, which provides a solid base for the growing manufacturing base. With an average age of only 29 years, Uzbekistan’s population is due to double to 70mn by 2050, according to the UN. Leading companies like Artel and the national car maker UzAvto have also started to export to their neighbours, with Kazakhstan as the richest country in the region, thanks to its oil, being the most popular destination.
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