Economist Behzod Khoshimov names reasons for low investment inflows to Uzbekistan

"For a large country like Uzbekistan with low investments and funds, an annual investment of $1.36 billion (the volume of direct foreign investments in the first nine months of 2023 – ed.) is a very small figure. Countries like Georgia and Kazakhstan have attracted dozens of times more foreign investment per capita. Uzbekistan's experience in attracting foreign investments hasn't been good, but there are many opportunities. It would be good if tens of billions of dollars in investments came in, and we should strive for that," he said.

Khoshimov expressed concern about the low inflow of foreign investments.

"What worries me is the slow rate of investment inflow. Previously, investments were low because Uzbekistan was closed, but they have increased in recent years due to its opening up, though not at the same pace as in Kazakhstan and Georgia," he said.

According to Khoshimov, foreign investors invest to increase their money and make a profit by setting up services or production. They pay taxes to Uzbekistan and create new jobs, bringing a number of benefits to the country.

"When money comes into the budget, there will be more funds for those working in budget organizations, such as teachers, doctors, and security personnel. Additional value is also created, which enriches investors and becomes a value added to Uzbekistan's economy, enriching Uzbekistan," he added.

The economist also shared other thoughts about direct foreign investments on his Telegram channel.

"We are 'thirstier' for investments during this period and could derive more benefits. Our demographics show that we need money right now, as our population is aging, meaning they can create value while they are still able to work. If we don't attract enough investments now, we will continue to grow slowly in the future, just as in the past. Catching up with Kazakhstan could take not just 60-70 years, but even longer.

Direct foreign investments are also crucial for the country's growth as they bring not only capital but also technology and expertise, which are essential for us," he noted.

According to Behzod Khoshimov, the reason we have not been able to appear attractive for investments is that when "investment attraction measures" are mentioned, we usually only think of incentives, not "the rules of the game."

"It is the lack of reforms in crucial areas like ensuring the implementation of contracts, the independence and competence of the courts, that has been the main reason for the lack of investments," the economist writes.

For reference, in 2023, the volume of direct investments in Uzbekistan decreased. According to the Central Bank, the financial inflow to Uzbekistan in 2023 amounted to $6.6 billion. Of this, the net inflow of direct investments was $2.2 billion, which is 16% or $425 million less compared to 2022.