Afrosiab St. 4B, Office 201, Tashkent, Uzbekistan 100031
Monthly Meeting on January 30, 2020

January AmCham Meeting Hosts Mr. Bekenov, director of the State Assets Management Agency
More than 50 percent of the Uzbek gross domestic product (GDP) is produced by state enterprises. In some sectors, such as the energy sector and railroads, state participation can reach up to 70 to 100 percent. At the same time, these enterprises only employ 18 percent of the Uzbek workforce. As a result, excessive involvement from state institutions into the operations of state enterprises, along with lack of strategic planning, analysis, risk management, and corporate governance has made these state enterprises poorly efficient and of low interest for potential investors.
Results of this can be seen in how Uzbekistan is currently ranked in several different business categories. For example, despite general improvement and moving from 76th place to 69th place in the category of “Doing Business,” Uzbekistan overall has dropped from 92nd place in 2018 in “Resolving Insolvency” to 100th place in 2019.
In response to this, a Presidential Decree was issued to create the State Assets Management Agency in January 2019. The agency has been tasked to increase efficiency of state enterprises by implementing corporate governance, creating transparent mechanisms for privatization of state assets, and creating an integrated database of state asset. The agency will also oversee the efficient use of state assets, the regulation of bankruptcy and insolvency, and the regulation of valuation activity.
The agency’s plan for 2020 includes:
• Development of a new strategy for management of state assets (March 2020)
• Creation of new laws on privatization and insolvency (May 2020)
• Creation of unified valuation standards close to international standards (August 2020)
In 2020 the agency will also restructure the following:
• Navoi State Metallurgical Combine
• Telecommunications sector
• Transportation sector, including railroad
• Cotton processing industry
• Crops processing sector
Eight working groups have been created to inventory state assets in the following sectors:
• IT and communications
• Utilities, construction, and services
• Heavy industry – geology, metallurgy, and financial sector
• Light industry – machinery and electronics
• Social sphere – tourism and pharmaceutical sectors
• Oil and gas, chemical and energy sectors
• Agricultural and food sectors
• Industrial zones
From this inventory and analysis, the decision was made for the sale, partial sale, transfer to a public-private partnership, liquidation, IPO, or transfer to a branch or other state enterprise of 2,965 state enterprises.