The World Bank has published the next issue of the Economic Survey of Europe and Central Asia. The report analyses the economies of 23 countries of the region and provides forecasts of their socio-economic development in 2021 and 2022.
According to forecasts, in 2021, the economy of Uzbekistan will partially recover from the consequences of the crisis caused by the pandemic after a sharp growth slowdown in 2020. Until the economy is fully restored, support for socially vulnerable households and heavily affected enterprises should continue to be provided in order to mitigate the impact of the pandemic on their well-being.
According to bank experts, GDP growth will recover to 4.8% (previously 4.3%) in 2021. However, the rate of growth may be affected by uncertainty related to the pace of recovery of the world economy and the success of the national campaign to vaccinate the population against COVID-19.
The gradual recovery of trade and investment flows, remittances of migrant workers, the rich crops and the vaccination of the population will contribute to economic recovery and encourage the further reduction of unemployment and poverty. In 2022, GDP is projected to grow to 5.5% (previously 4.5%) as the vaccination rate of the population accelerates and the global crisis eases.
It is predicted that the current account deficit of the balance of payments will increase to 5.5% of GDP in 2021 as the volume of imports of machinery, equipment and other industrial goods within the framework of large investment projects recovers. Despite forecasts of a partial recovery in foreign direct investment after its decline in 2020, public and private loans are expected to continue to finance most of the current account deficit.
According to forecasts, the reduction of state budget revenues, the purchase of vaccines, the expansion of social support for the population and the increase in funding for social and economic development programs and state lending to enterprises will increase the budget deficit to 5.4% of GDP in 2021. It will be financed mainly by increasing public debt.