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Uzbekistan’s economy is expected to grow 7% in 2009, Economic and
Social Survey of Asia and the Pacific 2009, the flagship publication of
the United Nations’ regional arm – the Economic and Social Commission
for Asia and the Pacific (UNESCAP), said on Thursday, 26 March.
Growth performance and medium-term prospects
The economy of Uzbekistan was expected to grow at a healthy
pace in 2008. GDP growth in the first nine months of 2008 was 9.4%.
Industrial output and retail trade grew by 12.4% and 15.0%,
respectively, in that period. Gross fixed investment grew more than
20%, and foreign trade turnover benefited from an expansion in exports
in the first nine months of the year. Key commodities such as cotton,
gas and gold received a boost from strong commodity prices.
Uzbekistan has significantly accelerated its economic growth
and strengthened its fiscal position over the past five years. GDP is
expected to grow 7.0% in 2009. Benefiting from sound fiscal and
monetary policies, Uzbekistan is expected to continue its tax and
banking reforms, liberalize its trade and payments systems and adopt a
more flexible exchange rate policy. The country’s 2009 budget is
expansionary, envisaging a further increase in public-sector wages,
benefits, pensions and student grants.
Fiscal policy developments
The Government of Uzbekistan maintained a relatively prudent
fiscal stance to keep the State budget in balance in 2008. Fiscal
performance has improved in recent years, owing to strong economic
growth, high commodity prices and tax reforms. Favourable trends in
export revenue could help the Government meet additional social
spending on public sector wages and pensions.
Monetary policy
Inflation in Uzbekistan was expected to exceed 10% in 2008
due to rising food and fuel prices. To reduce inflationary pressures,
monetary policy was tightened in late 2007. But strong export-related
inflows and large increases in public-sector wages maintained
inflationary pressure in 2008. A moderate nominal appreciation of the
national currency, the som, was expected to control inflation in 2009
and reduce reliance on indirect tools of monetary policy.
Current account and trade performance
The current account of Uzbekistan was expected to have a
surplus of 21.7% of GDP because of a large trade surplus and increased
remittances from citizens working abroad. Rising global prices on the
country’s principal export commodities – gold, gas and cotton – were
expected to increase export revenues by more than 24% in 2008, and
hydrocarbons became a more important source of income than in the past.
Growing remittances were expected to ensure a surplus of current
transfers.
Source: UzDaily.com
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