American-Uzbekistan Chamber of Commerce
Business Newsletter


Week in Review:

December 16, 2011 - December 23, 2011 


In this issue
AUCC in Brief
Holiday Greetings from AUCC!
Afghanistan opens first ever train route
Uzbekistan to build gas pipeline to China
The Council of heads of EurAsEC countries to consider Kyrgyzstan's proposals
Hydroelectric power in Uzbekistan: solving or causing problems?
AUCC Office: Holiday Schedule
Contact Us
AUCC Members
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AUCC in Brief 

Established in 1993, the American-Uzbekistan Chamber of Commerce (AUCC) is a private, non-profit trade association representing interests of U.S. businesses ranging in size from small private enterprises to large, multinational corporations conducting business in Uzbekistan.

Our Mission: To advocate the views of the business community to ensure that private sector positions are considered during the development of key policies that impact American businesses and the future of U.S.-Uzbekistan relations.

Our Objective: To serve the needs of its members by strengthening commercial relations between the United States and Uzbekistan. 


Season's GreetingsHappy Holidays! 

May 2012 be a year of new beginnings and professional success and accomplishments!

Thank you for your support and interest in the American-Uzbekistan Chamber of Commerce and its activities. of 12/21/2011    


In a rare piece of good news for the war-ravaged country, a train chugged into the newly built station in the northern city of Mazar-i-Sharif for the first time on Wednesday after its inaugural 47-mile journey from the border with Uzbekistan.

Afghanistan has never had a functioning rail network. The 105 million project funded by the Asian Development Bank comes over a century after her ruler deliberately refused to join the rail age fearing any track would be used by invading foreign troops.

The country's industrial development was also victim of manoeuvres of the 19th century Great Game rivalry between Russia and Britain. Soviet occupiers abandoned a few rail projects in the 1980s, and later years of bitter civil war made such construction impossible.

The new railway comes after Pakistan closed off the supply route to Nato troops last month following an air strike on an army outpost killed 24 soldiers on Nov 26.

Nearly half of all cargo bound for Nato-led forces had run through Pakistan. Roughly 140,000 foreign troops, including about 97,000 Americans, rely on supplies from outside Afghanistan for the decade-long war effort.

"It's actually a big deal. It's very significant both practically and symbolically," said Fred Starr, chairman of the Central Asia-Caucasus Institute at Johns Hopkins University in Washington.

A US military spokesman says the new railway will be key to supplying American troops - and possibly also withdrawing non-lethal cargo during the troop drawdown set to begin next year.

"We do not have numbers yet, (but) we anticipate that the rail line will be able to speed the transit of cargo into Afghanistan and out of it," said Cmdr. Bill Speaks of the Office of the Secretary of Defense.

The Uzbekistan link is part of a wider ambitious plan to connect Afghanistan to its neighbours by rail.

Afghan officials are already planning to expand its infant railroad with another proposed line to Turkmenistan to the northwest.

Last month India unveiled plans to build what could be the world's most dangerous railroad from Afghanistan's mineral-rich heartland to an Iranian port on the Arabian Sea in attempt to open a new trade route and reduce Kabul's dependence on Pakistan. of 12/19/2011    


The Commencement Ceremony of Uzbekistan section of Central Asian Gas Pipeline Line C was held at Gazli, 110 kilometers away from Bukhara, on Dec. 15, 2011. This is another milestone deepening energy cooperation between Uzbekistan and China.
Central Asian Gas Pipeline is China's first strategic onshore pipeline for introducing foreign natural gas resources. Line C will be placed in parallel with Line A and Line B that have been built and put into operation, to transport natural gas from Turkmenistan, Uzbekistan and Kazakhstan. It is of significant importance to Uzbekistan for its diversification of natural gas export.  
Line C is 1,840 kilometers long in total, of which 529 kilometers falls within jurisdiction of Uzbekistan, giving it a designed gas transmission capacity of 25 billion cubic meters per year. As Trans-Asia Gas Pipeline Company Limited scheduled, Line C is expected to supply gas from January 2014, by when the entire pipeline will have an annual gas transmission capacity of above 55 billion cubic meters.

The Council of heads of EurAsEC countries to consider Kyrgyzstan's proposals on development of co-operation with Kazakhstan, Uzbekistan, Tajikistan and Azerbaijan of 12/19/2011    


The Council of heads of EurAsEC countries will consider Kyrgyzstan's proposals on development of co-operation with Kazakhstan, Uzbekistan, Tajikistan and Azerbaijan. The respective issue is on agenda of the meeting which is taking place in the Russian capital today.

As news agency managed to know, in case with Azerbaijan the matter is possibility of supply of jet fuel and other oil products to Kyrgyzstan. Kazakhstan will be offered to increase supplies of natural uranium concentrates up to 3 thousand tons through subsidiary production units of Kazatoprom NAK for processing at Kara-Balta ore mining industrial complex in 2012. Besides, issues on opening of coproduction of special products of NK Kazakhstan Engineering JSC with defence industry enterprises and on supply of tractor trailers from Kazakhstan to Kyrgyzstan will be raised.

In case with Russia, Kyrgyzstan will suggest signing intergovernmental agreement on development of cooperation in the sphere of electrical energy industry. In particular, the matter is construction of Kambarata-1 hydropower plant and four power plants of Upper-Naryn cascade. It will be offered to intensify cooperation in the military-industrial complex as well.

In case with Uzbekistan, Kyrgyzstan suggests raising an issue on not using restrictions over transit of products significant for Kyrgyz economy (oil products, raw material resources for needs of Mailuu-Suu electric-bulb plant and Kadamzhai stibial industrial complex).

As for all countries, Kyrgyzstan sees possibility of expansion of production of construction materials for the account of field development, opening joint ventures over processing fruits and vegetables, agriculture products and ventures on the basis of Worsted-Woolen Industrial Complex.

Hydroelectric power in Uzbekistan: solving or causing problems?  of 12/18/2011      


The growth of electricity production in Uzbekistan in the medium term will increase the load on hydrocarbon resources: today 77% of electricity at thermal power plants is generated by burning natural gas, 7% by burning black oil, and 3.5% by burning coal. The remaining 12% of electricity is produced at HPPs. Therefore, to address this imbalance Tashkent authorities thought of the energy generated by water.

Uzbekenergo and Uzvodenergo, the two suppliers of hydropower in Uzbekistan, are now planning to build and upgrade hydroelectric plants.

The Uzbekenergo State Power Company, by 2021, will build seven hydroelectric power plants (HPPs), worth more than US $1 billion, in Uzbekistan.

Uzvodenergo has less ambitious plans: during 2011-2015 the company will increase the generating capacity of small hydropower stations in the country by 219 megawatts through upgrades, at an estimated value of $260 million.

They plan to construct the seven new HPPs and reconstruct two existing small HPPs in the Tashkent and Surkhandarya regions. This will increase the generating capacity from 394 megawatts in 2010 to 613 megawatts by the end of 2015. They will increase the generation of electricity at small HPPs from 1.115 billion kilowatt hours to 2.19 billion kilowatt hours for the period indicated.

Despite the low share of hydropower in electricity production -- about 12% (7 billion kilowatt hours) -- Uzbekistan has considerable potential to develop small hydropower plants. According to experts, Uzbekistan has dozens of reservoirs, irrigation canals and rivers, which could be used to generate hydropower. They will be able to generate a total capacity of 1,180 megawatts with annual power generation of 4.6 billion kilowatt hours.

"Due to the fact that hydroelectric power plants will be built on a natural flow, it will be able to avoid significant flooding of land. Moreover, the construction of medium and small HPPs is more rational from the ecological and economic perspectives," said analyst Anvar Jumayev.

According to experts, the increase in power production at these HPPs will make more than 2.5 billion kilowatt hours, which will save 866 million cubic meters of natural gas per year.

However, there is opposition to the construction of these hydroelectric plants.

"The construction of hydroelectric power stations, especially on mountainous rivers, brooks no interruptions. If the object is suspended until the "better times", and after some time its construction will continue, the total cost of HPPs will increase substantially," said Ilkhat Tushev, the analyst at Central Asia Investments. "Under these conditions, chasing for fake saving and fake price begins," agrees an expert Dilmurad Kholmatov. "As a result, the contractor does not fit into the estimate, loses money and misses the deadline."

Moreover, according to experts, the use of small and medium-sized HPPs can be effective only if they are built for the needs of a particular user, such as a large company. "The construction of hydroelectric power plants is mostly scheduled for the central part of the country," said an expert Vasily Lanskoy, "whereas, the eastern and southern regions of the country have power shortage." Thus, the power grid infrastructure will require the costs that reduce the effect of cheap electricity coming from hydroelectric power plants.

However, the main problem is that the possibilities for the construction of HPPs in Uzbekistan are limited due to exhausted hydro potential. The deficit of irrigation water and the increased low water seasons in the past three-four years have already made changes to the program for the construction of small HPPs.

In particular, in 2006 Uzvodenergo had to abandon the construction of the second generating unit of the Tupolan HPP worth $40 million in the Surkhandarya region, as it turned out that the constructed reservoir at the HPP is not filled in the planned amount of 500 million cubic meters a year. With the water level of 120 million cubic meters, the reservoir will be able to provide water only for the first unit of the HPP with the capacity of 30 megawatts.

Moreover, experts believe that Uzbekistan's hydropower industry currently has a number of problems with technical, organizational and regulatory developments. "Today, the country has poor equipment repair facilities," believes Lanskoy. "And a massive construction of hydropower facilities is possible only with the mass production of equipment."              

AUCC Office: Holiday Schedule 


The AUCC office will be closed on Monday, December 26, 2011 and Monday, January 2, 2012.     

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Contact Information


The American-Uzbekistan Chamber of Commerce
1300 I Street, N.W., Suite 720W
Washington, DC 20005
phone: 202.509.3744
[email protected]  






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