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Event
At a meeting in Moscow on December 19th the Collective Security Treaty Organisation (CSTO) announced that it had accepted Uzbekistan's withdrawal from the organisation.
Analysis
The bloc's decision is essentially a formality-Uzbekistan had unilaterally suspended its membership of the organisation in June 2012. However, the announcement ties up loose ends, as Uzbekistan had legally remained a part of the CSTO. The Belarusian president warned that if Uzbekistan decided that it wanted to rejoin the organisation, it would not be given any concessions and would have to fulfil all the requirements of the CSTO again. Uzbekistan previously left the CSTO in 1999, but decided to rejoin in 2006. The authorities' decision appeared to have been motivated by the US response to the Andizhan massacre in 2005.
Uzbekistan's withdrawal from the CSTO will not have a significant impact on relations with Russia. Responding to Uzbekistan's decision, the Russian foreign minister, Sergei Lavrov, said that although Russia regretted Uzbekistan's decision, he believed that it was possible to co-ordinate the CSTO's agenda at a bilateral level, adding that Uzbekistan and Russia already had agreements on military co-operation in place. Mr Lavrov met his Uzbek counterpart, Abdulaziz Kamilov, on December 17th. They discussed the potential ramifications of the US withdrawal from Afghanistan in 2014 on the stability of Central Asia. This will be one of the main challenges for the region in the coming years, and will ensure that ties between Uzbekistan and Russia remain fairly close.
Uzbekistan has been developing closer ties with the US in a bid to counter any negative implications of the withdrawal from Afghanistan. Improved relations will become increasingly important as occasional problems with the Pakistan supply route will increase the importance of Central Asia in the withdrawal. Uzbekistan's exit from the CSTO will allow it much more freedom to pursue negotiations on this matter.
December 20, 2012
Most political parties are pro-government
Uzbekistan's Soviet-style constitution promises wide-ranging political rights that, in reality, are curbed by state practice and legislation. Although stating that all citizens have the right to form trade unions, political parties and any other public associations, subsequent legislation and administrative procedures ensure that only parties approved by the state can operate legally in Uzbekistan. Until 2004 the main political force was the PDP, headed by Abdulhafiz Jalolov. As of the 2004 election, the PDP ceded its dominant position to the LDP, founded in November 2003 by government loyalists, and describing itself as a party for entrepreneurs and businessmen. In addition to these two, three other pro-government parties won parliamentary seats: the Adolat (Justice) Social Democratic Party (not to be confused with the banned Islamic movement Adolat), Fidokorlar (Self-Sacrificers') Party, and Milliy Tiklanish (National Renaissance) Party.
Secular opposition parties struggle to survive
The government allows no genuine opposition movements to operate freely in Uzbekistan, and uses force, exile and legal harassment to prevent credible opposition groups from emerging. Two main secular opposition movements emerged in the late communist era: Birlik (Unity) and Erk (Freedom, which split from Birlik in the early 1990s). The leaders of both groups, Abdurahim Pulatov (Birlik) and Muhammad Solikh (Erk), are living in exile, and years of repression have left the groups with limited popular support. Between mid-2003 and early 2005 the movements were permitted to hold small-scale meetings in Tashkent, but the authorities rejected their attempts to register as political parties in advance of the 2004 election and prevented their candidates from standing as independents.
Two parties attempt to represent the large agricultural population, Ozod Dehqonlar (Free Peasants) and the Agrarian Party, both of which were barred from the 2004 election. Neither has been able to take advantage of the discontent with government policies that exists in rural areas. Another secular opposition movement, Serquyosh Uzbekistonim (My Sunny Uzbekistan), emerged in mid-2005. The group's leader, Sanjar Umarov, was highly critical of the authorities' response to the unrest in Andizhan, and in October 2005 was arrested—ostensibly on charges of embezzlement. He was subsequently sentenced to 14.5 years in prison. Another leader of My Sunny Uzbekistan, Nodira Hidoyatova, received a ten-year sentence, having been convicted of a range of charges, including tax evasion (although she was released from custody in May 2006, with her prison term reduced to a three-year suspended sentence).
| Legislative Chamber election, Dec 26th 2004(a) | ||
| Party | % of vote | No. of deputies |
| Liberal Democratic Party | 34 | 41 |
| People's Democratic Party | 23 | 33 |
| Fidokorlar (Self-Sacrificers') Party | n/a | 18 |
| Milliy Tiklanish (National Renaissance) Party | n/a | 11 |
| Adolat (Justice) Social Democratic Party | n/a | 10 |
| Independent | n/a | 7 |
| Total | 100 | 120 |
| (a) Run-off elections were held in 56 constituencies on January 9th 2005. Official turnout was 85.1% in the first round and 80% in the run-off elections. | ||
| Source: press reports. | ||
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Underground groups win supporters
The suppression of the secular opposition has left virtually no avenues open for dissent, and has increased the attractiveness of underground groups such as Hizb ut-Tahrir (Party of Freedom), a radical Islamist group that seeks to overthrow the Karimov administration and establish an Islamic state. Hizb ut-Tahrir does not advocate the use of violence in Uzbekistan (although it has incited and used violence elsewhere), but the Uzbek authorities have accused it of espousing an ideology that encourages terrorism. They have arrested many of those suspected of membership of the group, and handed down lengthy prison sentences for such offences as possessing banned literature.
Unlike Hizb ut-Tahrir, the Islamic Movement of Uzbekistan (IMU) advocated the use of violence to oust the government. Allied to al-Qaida, the IMU was believed to have been responsible for the February 1999 bomb attacks in Tashkent (see Recent political developments). The movement suffered a significant military defeat at the hands of US-led coalition forces in Afghanistan in November-December 2001, although members of the IMU are now thought to be hiding along the Afghanistan-Pakistan border, and there are reports that some have tried to infiltrate back into Central Asia. An IMU successor group, the Jihad Islamic Group (JIG), is believed to have been responsible for several terrorist attacks in Uzbekistan in March and July 2004.
March 20, 2007
Official name
Republic of Uzbekistan
Legal system
The Soviet republic of Uzbekistan declared its independence on September 1st 1991, after the failure of the Moscow coup. A new constitution was adopted on December 8th 1992, declaring Uzbekistan a multiparty democracy and a presidential republic
National legislature
A bicameral parliament, the Oliy Majlis (Supreme Assembly), was elected in two stages in December 2004 and January 2005, replacing the unicameral 250-member legislature. Following the election in December 2009, the Legislative Chamber, the lower house of the new parliament, comprises 135 members chosen by direct election. The 100-member upper house, the Senate, is made up of 84 senators elected by local governments and 16 senators appointed by the president
Electoral system
Universal suffrage over the age of 18
National elections
December 2009 (parliamentary); December 2007 (presidential). Next parliamentary election due in December 2014; next presidential election scheduled for 2015
Head of state
Islam Karimov, re-elected president with 88% of the vote on December 23rd 2007
National government
Council of Ministers, headed by the prime minister, who is nominated by parliament on the recommendation of the president. In practice, Mr Karimov exercises total control and appoints regional governors, who report directly to him
Main political parties
Adolat (Justice) Social Democratic Party; Fidokorlar (Self-Sacrificers' Party); Liberal Democratic Party (LDP); People's Democratic Party (PDP, former Communist Party); Milliy Tiklanish (National Revival), all pro-government creations; Birlik (Unity) and Erk (Freedom), both banned democratic parties
Council of Ministers
Prime minister: Shavkat Mirziyoyev
Deputy prime ministers: Rustam Azimov
Gulomdzhon Ibragimov
Adham Ikromov
Elmira Basithanova
Ulugbek Roziqulov
Botir Zokirov
Key ministers
Agriculture & water: Zafar Ruziev
Culture: Tursunali Kuziyev
Defence: Kabul Berdiyev
Economy: Galina Saidova
Education: Temir Shirinov
Emergency situations: Tursunxon Xudoyberganov
Finance: Rustam Azimov
Foreign affairs: Abdulaziz Kamilov
Health: Anvar Alimov
Interior: Bakhodir Matlyubov
Justice: Nigmatilla Yoldoshev
Labour & social protection: Aktam Xaitov
Central Bank chairman
Faizulla Mullazhanov
December 14, 2012
Outlook for 2013-17
Review
December 14, 2012
Population growth slows
Data on Uzbekistan's population are unreliable and are only intermittently available. According to the World Bank, the population was 26.2m in 2004; the Economist Intelligence Unit estimates that it had risen to about 27m by January 2007 (based on official figures). Population growth slowed from an annual average of 2.5% in the 1980s to 1.9% in 1990-99, decelerating further to an annual average of just over 1.2% since 2001, owing to a falling birth rate and large-scale emigration by ethnic minorities. Between 1990 and 1999 there was net emigration of 845,000 people, most of them Russian-speakers.
Officially registered unemployment was just 0.4% of the workforce as of mid-2004. However, the UN Development Programme (UNDP) has estimated unemployment at 6%. Moreover, hidden unemployment (workers on compulsory unpaid leave) was as high as an additional 8% in industrial enterprises in 2004. The largest share of unemployment is in rural areas; 73.4% of total unemployment was in these areas in 2004, according to the UNDP. The number of rural unemployed is likely to have risen since then, as restructuring in the agricultural sector has been transforming the shirkat (large agricultural enterprises) into private farms (see Economic sectors: Agriculture).
Population data are skewed by political aims
The size of ethnic minorities and the scale of emigration are sensitive subjects. The government wants to balance its emphasis on Uzbek nationhood with policies that will slow the exodus of non-Uzbeks. The position is complicated by the fact that in the past many people, especially Tajiks, came under official pressure to declare themselves as ethnic Uzbeks. As a result, the number of Tajiks indicated in official statistics is probably under-reported.
| Ethnic composition of the population | ||
| (% of total; year-end) | ||
| 1989 | 1996 | |
| Uzbek | 71.1 | 75.8 |
| Russian | 8.3 | 6.0 |
| Tajik | 4.7 | 4.8 |
| Kazakh | 4.1 | 4.1 |
| Tatar | 3.3 | 1.6 |
| Kyrgyz | 0.9 | 0.9 |
| Jewish | 0.5 | 0.1 |
| German | 0.2 | 0.1 |
| Other | 6.9 | 6.6 |
| Sources: 1989 Soviet census; Uzbek government. | ||
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March 20, 2007
Data and charts: Annual trends charts
December 14, 2012
Uzbekistan: Country outlook
FROM THE ECONOMIST INTELLIGENCE UNIT
POLITICAL STABILITY: The president, Islam Karimov, dominates politics, and there is little prospect of democratisation over the forecast period. Mr Karimov, who was most recently elected for a seven-year term in December 2007, is expected to maintain a firm grip on power. Years of repression have prevented the emergence of an opposition figure capable of challenging him successfully. Most of his opponents are in exile. There seems to be no co-ordinated opposition to his rule from within the political hierarchy--although recent events in the Middle East and North Africa (MENA) have shown how quickly such assumptions can change. The centralisation of power in Mr Karimov makes for an uncertain outlook once he departs politics. Doubts over the 74-year-old's health add to the uncertainty.
ELECTION WATCH: A parliamentary election will be held in 2014, although parliament is at best a rubber-stamp body. The authorities will heavily control the election, and voters will not be given a meaningful choice: genuine opposition parties were impeded from taking part in the parliamentary election in December 2009. A more significant issue is the next presidential election. A new election law was passed in March 2012 and confirms that the next presidential election will be held in 2015. Confusion had arisen following parliament's decision in December 2011 to reduce the president's terms in office from seven to five years. Mr Karimov could stand again in the presidential election, if his health permits, and he would be certain to win. However, in view of his advancing age (he turned 74 in January 2012), he is more likely to attempt an orderly handover of power to a trusted successor, whether in 2015 or earlier.
INTERNATIONAL RELATIONS: Relations with the US and the EU have improved in recent years, driven by anti-terrorist initiatives, the regional security agenda, and the desire of some EU states to look for alternative energy sources in Central Asia in order to reduce their reliance on Russia. The US is becoming a more prominent partner in anti-terrorism measures, following an agreement in 2009 to allow US non-munitions supplies to Afghanistan to cross Uzbek territory. US concerns over the reliability of Pakistan as a transit route to Afghanistan have taken priority over human rights concerns. In August the latest high-level meeting between the Uzbek and US authorities was held in the Uzbek capital, Tashkent. Links are likely to deepen ahead of the US withdrawal from Afghanistan in 2014.
POLICY TRENDS: The government will continue to support growth by expanding public investment into infrastructure and industry--partly financed from the Fund for Reconstruction and Development (FRD)--and by increasing public-sector wages and social payments. The IMF has repeatedly called for greater progress in developing the banking system, liberalising the trade and payments systems, and adopting a more flexible exchange-rate policy. Given the government's record, the Economist Intelligence Unit remains sceptical that rapid progress on these issues will occur.
ECONOMIC GROWTH: Real GDP grew by 8.3% in 2011, according to Mr Karimov, modestly more slowly than in 2010. Nonetheless, official output data are highly suspect and often internally contradictory. We expect that officially reported growth will continue to exaggerate the true rate.
INFLATION: The government has said that inflation did not exceed the target of 7-9% in 2011. However, official figures understate the true level of inflation, which we believe to be 13.3% at end-2011. In 2012 the poor grain harvest in Kazakhstan, owing to a drought, will have a feed-through effect on food prices, as Kazakhstan is one of the main suppliers of grain to Uzbekistan. This has probably lead to an increase in inflationary pressures in late 2012. However, the impact of the regional drought has been partly been offset by robust agricultural performance, according to official data. We estimate annual average inflation of 13.2% in 2012. Throughout the forecast period the authorities will attempt to limit inflation through price controls on basic foodstuffs and energy. However, historically high global commodity prices, combined with a depreciation of the som (which will boost imported inflation) will create inflationary pressures. Robust money supply growth--from rapid growth in export earnings, and as the government increased wages and benefits further--will also push up prices. Large inflows of gas-related foreign exchange and a continuation of loose fiscal policy will prevent more rapid disinflation in 2013-17. From 2013 onwards, slower growth in domestic demand and the money supply will help to curb inflationary pressures. We forecast annual average inflation of 10.8% in 2013-17.
EXCHANGE RATES: The authorities will continue to target a regular pace of nominal depreciation to support export competitiveness. By end-2011 the som had depreciated by around 26% in nominal terms since end-September 2008. We expect the official exchange rate to be around Som2,604:US$1 by end-2017, compared with Som1,795:US$1 at end-2011, a fall of about 31%.
EXTERNAL SECTOR: We estimate that the current-account surplus rose in 2011 as a consequence of a rise in export prices. Based on historical data from the IMF and the World Bank, we estimate the current-account surplus at US$3.4bn (7.4% of GDP) in 2011. Automotive exports will continue to rise. However, the current-account surplus will fall from 2012 onwards, to around 3.2% of GDP by 2017, as global gold and cotton prices remain high by historical levels. Although a fall in global food prices over the longer term will reduce import costs, demand will rise for consumer goods and imported inputs into state-funded infrastructure development. Our forecast assumes that gas export prices will remain higher than in the historical period. Although gas supplies to Russia declined in 2011, gas exports to China, which were launched in 2012, will help to support exports.
December 12, 2012
Outlook for 2013-17: Forecast summary
| Forecast summary | ||||||
| (% unless otherwise indicated) | ||||||
| 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | |
| Real GDP growth | 7.4 | 6.7 | 6.5 | 6.3 | 6.0 | 5.8 |
| Consumer price inflation
(av) | 13.2 | 12.6 | 10.2 | 10.6 | 10.5 | 10.1 |
| Consumer price inflation
(end-period) | 14.3 | 10.1 | 10.6 | 10.5 | 10.5 | 10.1 |
| Government balance (% of GDP) | -0.2 | -0.2 | -0.1 | 0.1 | 0.3 | 0.4 |
| Exports of goods fob (US$ m) | 12,438 | 12,325 | 12,684 | 12,825 | 12,861 | 13,088 |
| Imports of goods fob (US$ m) | -8,640 | -8,910 | -9,450 | -9,890 | -10,340 | -10,830 |
| Current-account balance (US$ m) | 3,266 | 3,289 | 3,287 | 3,154 | 2,899 | 2,640 |
| Current-account balance (% of GDP) | 6.5 | 5.9 | 5.4 | 4.6 | 3.9 | 3.2 |
| External debt (year-end; US$ bn) | 9.5 | 11.4 | 13.3 | 15.2 | 17.0 | 19.0 |
| Exchange rate Som:US$ (av) | 1,889 | 2,046 | 2,174 | 2,309 | 2,452 | 2,604 |
| Exchange rate Som:US$ (end-period) | 1,973 | 2,104 | 2,234 | 2,373 | 2,520 | 2,676 |
| Exchange rate Som:€ (av) | 2,411 | 2,583 | 2,723 | 2,857 | 3,089 | 3,282 |
| Exchange rate Som:€ (end-period) | 2,525 | 2,640 | 2,759 | 2,978 | 3,176 | 3,370 |
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December 14, 2012
Land area
447,400 sq km, of which 9% is arable
Population
27.6m (January 2009)
Main towns
Population in '000, July 1999
Tashkent (capital): 2,400
Samarkand: 392
Namangan: 378
Climate
Continental desert
Languages
Uzbek is the state language; Russian is widely spoken; Tajik is spoken in Samarkand and Bukhara; Karakalpak is used in the autonomous republic of Karakalpakstan
Weights and measures
Metric system
Currency
The som-coupon was introduced on November 29th 1993 as the successor to the rouble. It was replaced by the som on July 1st 1994, at a rate of Som7:US$1. A multiple exchange-rate system was introduced in 1997, and the main reference rate was subsequently repeatedly devalued in order to keep pace with the rapid depreciation of the currency on the black market. The exchange rate was unified on October 15th 2003 at a rate of Som975:US$1
Time
Six hours ahead of GMT
Public holidays
January 1st (New Year); March 8th (International Women's Day); March 21st (Nowruz; Persian New Year); May 9th (Day of Memory and Respect); September 1st (Independence Day); October 1st (Day of Teachers and Instructors); October 26th(Feast of the Sacrifice); December 8th (Constitution Day)
March 26, 2012