Page 15 - Uzbekistan rising bne IntelliNews special report

bne December 2021 Special Report: Uzbekistan Rising I 15
Uzbekistan’s economy bouncing back strongly, World Bank ups 2021 GDP forecast to 6.2%
Ben Aris in Berlin
A
economy is bouncing back from last year’s coronacrisis crisis strongly. The World Bank has upped its GDP forecast to 6.2% this year from 4.1% previously, and to 5.8% in 2022.
The country was hurt like everyone
else as so much of the global economy shut down for months during the
worst of the coronavirus (COVID-19) pandemic. With a young population and a diversifying economy, Uzbekistan has been flourishing in recent years since Uzbek President Shavkat Mirziyoyev started to open up to the rest of the world and lift restrictions on private business imposed by his predecessor Islam Karimov, who died in 2016.
Most of the main macroeconomic indicators are doing well. After slowing to 1.7% last year, Uzbekistan's GDP
rose to 6.2% in the first half of this
year. Economic growth was fuelled
by increased household incomes and domestic investment, anti-crisis measures and tax breaks, the World Bank says.
Inflation, a problem for all countries this year, has also been taken in hand and fell from 14.7% in June last year to 11% in June this year. The indicator remained double-digit due to the outstripping growth in food prices, the World Bank said in its report.
In a country with a large and very young population unemployment is a major concern for the government, but its decisive action and government subsidies have kept it in check. The unemployment rate fell from 13.2% in the first half of 2020 and 10.5% at the end of 2020 to 10.2% in the first half of 2021. However, unemployment remains at elevated levels and has not yet reached the level of the period before the start of the pandemic (about 9%).
Retail sector booming
The Uzbek retail market is becoming increasingly attractive and the supermarket sector in particular
has been singled out as “ready to boom” following its peers, where the introduction of organised retail has led to a rapid development of the sector.
The sector has attracted tens of millions of dollars in foreign investment, according to the Financial Times. The European Bank of Reconstruction and Development (EBRD) has also invested some $40mn to take a stake in Korzinka, one of the biggest supermarket chains, while big French grocer Carrefour became the first international retailer
to enter the Uzbek market last year, intending to invest $100m.
Uzbekistan GDP growth y/y
s one of the only two major economies in the world to avoid
recession last year, the Uzbek
Korzinka, which accounts for half of all supermarket turnover in the country, anticipates expanding its chain from
68 to 150 stores by 2025. Carrefour has opened three stores, and a further four to six are planned for this year alone. The biggest expansion is expected from Makro, Uzbekistan’s current leader by the number of stores, with 109 mainly supermarkets and express shops. Makro plans to have between 800 and 1,000 stores in the next five years, according to its chief executive, Roman Sayfulin.
The latest addition to the increasingly hot Uzbek retail sector, Ukraine and Moldova's largest online retailer Rozetka, has arrived on the Uzbek market, launching the website rozetka.uz in September. The site offers household
Source: Uzbekistan state statistics agency
Uzbekistan ILO unemployment
Source: Rosstat
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