American-Uzbekistan Chamber of Commerce
Business Newsletter

 

Week in Review:


April 6, 2012 - April 13, 2012  

 

In this issue
AUCC in Brief
Uzbekistan presents new incentives to foreign investors
SCO security councils' 7th secretaries meeting held in Beijing
Asian Development Outlook 2012: Confronting rising inequality in Asia
Having a gas: Uzbekistan enjoys booming economy
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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. 

Uzbekistan presents new incentives to foreign investors

http://www.uzdaily.com of 4/11/2012

 

President of Uzbekistan Islam Karimov signed a decree "On additional measures to stimulate attracting foreign direct investments" on April 10, 2012.  It purports to create a favorable investment climate for foreign investors, direct foreign investments to develop high-technologies, strengthen foreign direct investments and modern technologies' development in Uzbekistan's regions and further promote a system of guarantees and preferences for foreign investors and enterprises with foreign investments.

According to this decree, Uzbekistan needs to further attract foreign direct investments so as to upgrade local industries.  To do so, the country needs to abolish the red tape faced by foreign investors and prevent illegal infringement and interference by controlling and state bodies in the activities of enterprises with foreign investments.

The decree says that newly established enterprises with investment volume of at least $5 million reserve the right to pay for 10 years the taxes that were in place at the time of registration. The rule applies to income taxes, property taxes, for the improvement and development of social infrastructure, the single social tax, single tax, as well as mandatory contributions to the Republican Road Fund and Reconstruction Fund, refurbishment and equipping of educational and medical institutions.

In addition, the decree establishes a procedure where investment projects worth more than US$50 million and with a foreign investors share over 50%, the construction of the required engineering and communication networks will be carried out using budget funds and other domestic sources of financing.

The decree banned and said it is illegal to set additional requirements and limitations to the activities of foreign investors and enterprises with foreign capital by ministries and departments, state bodies, law enforcement and other controlling bodies.

The country's prosecutors are to make sure that state and controlling bodies adhere to the laws on protection of rights and guarantees to foreign enterprises and companies with foreign investors.  They are responsible for adopting measures to prevent violations to the decree.

The decree entrusted the State Tender Commission to sell at the request of foreign investors to low liquid objects at zero redemption cost to set up enterprise with foreign investment through signing direct contracts with the investor under concrete investment obligations.

The Ministry of Foreign Affairs and the Ministry of Interior Affairs were assigned the task to provide multiple 12 months visas to employees of enterprises with foreign investments by President Karimov.

The Cabinet of Ministers was instructed to provide access to foreign investors to economic information considered necessary to their investment activities.

SCO security councils' 7th secretaries meeting held in Beijing

http://english.sina.com of 4/12/2012      

   

The seventh secretaries meeting of the Shanghai Cooperation Organization (SCO) security council was held here on Thursday, and participants exchanged views on further security cooperation during the next decade of the SCO's development.

Representatives from Kazakhstan, Kyrgyzstan, Russia, Tajikistan, Uzbekistan and China attended the meeting and all parties signed meeting memos based on the outcome of the meeting.

All sides at meeting commented positively on drug control departments, the efforts by member states to cut off channels for terrorism, separatism and extremism and a joint anti-terrorism drill code-named Tianshan-II (2011). They also applauded the cooperation among member states in fighting terrorism, separatism and extremism and commended the SCO Counter-Terrorism Convention of 2009.

All parties noted that the SCO is facing more difficult tasks in safeguarding regional peace and promoting common development as hot international and regional issues exist and new conflicts and challenges emerge. They agreed to improve the SCO's capacity to react to threats and challenges under the principle of not interfering with each other's internal affairs and respecting the sovereignty, territorial integrity and independence of member states.

All parties discussed how to improve political and diplomatic mechanisms for defeating threats to regional peace, security and stability and how to cooperate on fighting terrorism, separatism and extremism.

They all agreed that regional peace and stability largely lies in the resolution of Afghanistan's problems. The independence, integrity of sovereignty and territory of Afghanistan should be respected and its people's efforts for peaceful construction deserve support.

All parties emphasized the grave threat of drug smuggling in the region and agreed to enhance drug control cooperation and assistance as well as pragmatic cooperation in specific departments so as to better defeat the drug threat.

All parties noted disruptive activities launched by terrorist, separatist and extremist forces via the Internet and the activities' threats to the security and stability of member states, agreeing to further promote cooperation in safeguarding international information security.

They also listened to reports delivered by the executive commissioners of regional anti-terrorism organizations.

Chinese State Councilor Meng Jianzhu presided over the meeting as China is the rotating chair of the SCO.

He said the meeting has laid a solid foundation for this year's SCO summit as well as the organization's further efforts in safeguarding regional peace, security and stability.

Meng pointed out that the SCO has achieved fruitful results, gained greater international status over recent years and played an important role in safeguarding regional stability and development, building friendly, equal and mutual relations among member states.

The overall regional security situation of the SCO remains stable. However, it is affected by the uncertain international financial situation, the turbulence in west Asia and north Africa, the uncertainty of Afghanistan's security situation, the threat of terrorism, separatism and extremism, drug problems, cross-border organized crime and Internet crime, Meng said.

The SCO must enhance security cooperation with specific goals and build a more effective preventive and attack mechanism, he said.

SCO members agreed to improve the SCO's security cooperation and emergency response mechanism, enhance member states' capacity to react and take action quickly and strengthen cooperation between their law enforcement and security agencies to ensure multilateral cooperation projects.

Asian Development Outlook 2012: Confronting Rising Inequality in Asia

http://www.adb.org/countries/uzbekistan of 4/11/2012      

  

The annual Asian Development Outlook provides a comprehensive analysis of economic performance for the past year and offers forecasts for the next 2 years for the 45 economies in Asia and the Pacific that make up developing Asia.

Despite weak global demand, Asian Development Outlook 2012 expects that developing Asia will largely maintain its growth momentum in the next couple of years, in an environment of easing inflation for most regional economies, although policy makers must be alert to further oil-price spikes arising from threats of oil supply disruptions.

The report sees that the greatest risk to the outlook is the uncertainty surrounding the resolution of sovereign debt problems in the eurozone. Still, in the absence of any sudden shocks, developing Asia can manage the effects on its trade flows and financial markets.

The theme chapter looks at widening inequality: in spite of developing Asia's great success in raising living standards and reducing poverty, swelling income disparities threaten to undermine the pace of progress. Regional policy makers need to ensure that the benefits of growth are widely shared.  Full report can be accessed here.   

Having a gas: Uzbekistan enjoys booming economy

http://www.euronews.com of 4/7/2012      

  

According to the International Monetary Fund Uzbekistan has coped well with the financial crisis, maintaining a budget surplus and low public debt. Even during the crisis, economic growth in the republic has stood at around eight per cent over the last five years.

Growth has continued unabated despite international concerns over human rights and democracy in the country. Prosperity in Uzbekistan has been fuelled by its natural resources, primarily gas, of which BP has estimated the country has in excess of 1.58 trillion cubic meters. Once processed, 40% is exported.

This year business representatives from more than 30 countries gathered in the Uzbek capital, for the fifth Tashkent International Investment and Finance Forum.

In attendance was Husan Khasanov, a representative of the Ministry of Foreign Economic Relations, Investments and Trade of Uzbekistan. He spoke of why Uzbekistan is so appealing for foreign investors:

"More than 60% of foreign investments are for the oil and gas industries. They hope to increase the transit capacity of gas in the Republic of Uzbekistan.

"As well as joint ventures in the oil and gas industry, investors are also interested in the petrochemical industry, particularly in the production of fertilizers.

Funded by the state owned Development Bank of China, holding company Uzbekneftegaz, together with the Chinese company CNBC is starting a project to vastly increase gas exports to China."

Most Uzbek gas exports have traditionally gone to Russia, but this is quickly changing with priority now switching east, to China.

Despite this thirst of industrialising nations, official figures from Uzbekistan show that only about 25% of the country's total hydrocarbon resources have been extracted so far.

Exports of natural gas are a vital for Uzbekistan's economy, accounting for much of its gross domestic product, but building on this the country is hoping next to exploit its large coal reserves, the second largest in Central Asia.

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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]
www.aucconline.com  

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