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2011 - Year of Small Business & Private Enterprise

Uzbekistan declares 2011 the year of small businesses and private enterprise

In the 20 years of the Republic of Uzbekistan’s independence, one of the
country’s highest development priorities has been to optimize conditions,
advantages and benefits and to provide comprehensive support to accelerate the
development of small businesses and private enterprise.

Through these efforts Uzbekistan is consistently pursuing the key goal of
creating a property-owning middle class as the basis for a democratic society. That
goal determines much of the essence and content of the reforms being implemented.
Uzbekistan has done a great deal in recent years to create a climate favourable
to business and to stimulate small businesses and private enterprise.
Thus while in 2000 small businesses produced 30 per cent of the country’s
gross domestic product (GDP), the equivalent figure for 2010 was 52.5 per cent, and
that for 2011 was likely to reach 54 per cent.

Small businesses and private enterprise are becoming an important source of
employment and stable income for the people of Uzbekistan, with about 75 per cent
of the country’s working population currently employed in this area.
In 2010, 480,000 new jobs were created as a result of the development of
small businesses and private enterprise, with more than 60 per cent of those new
jobs in rural areas. This is significant: about 50 per cent of the population lives in
such areas.

On the initiative of President Islam Karimov, 2011 has been declared the year
of small businesses and private enterprise in Uzbekistan.

On 7 February 2001, with the goal of implementing a broad range of measures
to create the best possible conditions for the future development of small businesses
and private enterprise, President Karimov approved the Government programme for
the year of small businesses and private enterprise, which emphasizes the following
• Creating the most favourable business environment possible; further
developing legislation to prioritize and provide reliable guarantees for private
ownership; giving greater freedom of entrepreneurship; reducing Government
regulation and licensing; eliminating bureaucratic barriers and obstacles;
introducing market instruments and systems providing small business owners
with wide access to credit and raw material resources and to Government
orders for their products;
• A large-scale reduction of Government and regulatory interference in the
financial and economic activities of enterprises;
• Further simplifying the procedures for creating and registering small
businesses and enterprises; taking concrete steps to resolve problems relating
to setting up and connecting small business owners to utilities and communications, the allocation of commercial premises and necessary plots of
• Creating the most favourable possible conditions, advantages and benefits in
the area of taxes and other payments for small businesses and private
enterprise; improving and unifying accounting systems and methods for
submitting accounts to financial, tax and statistical authorities;
• Further improving access to and volume of credit extended to small businesses
and private enterprise, particularly loans for investment or start-up capital, and
medium- and long-term loans for modernization and technological upgrades
for manufacturing;
• Broad efforts to attract and steer foreign investment to the development of
small businesses, particularly in the form of preferential loans from
international financial institutions and direct investors;
• Expanding the opportunities for developing small businesses and private
enterprise in the industrial and organizational areas of modern high-technology
industries, and promoting the involvement of small businesses and private
enterprise in innovative technologies;
• A major resolution of issues relating to expanding the participation of small
business owners and private entrepreneurs in external economic affairs,
assisting and increasing their export potential and penetration of their exports
into regional and world markets;
• Further development of information systems and consulting assistance to small
business owners and private entrepreneurs, as well as in the areas of staff
training, retraining and qualification enhancement.

In the context of implementing this programme the Government is giving
particular attention to increasing women’s share in this sector.
Starting in 2011, the business tax burden is due to be reduced from 7 to
6 per cent in order to increase development opportunities for small businesses and
private enterprise.

The Presidential Decree of 28 July 2010 on additional measures for involving
graduates of educational institutions in entrepreneurial activity — which makes
provision for graduates of the nation’s professional colleges to be eligible for loans
without collateral guarantees — has taken on special significance. As a result, in
2011 banks intend to continue the practice of extending preferential loans for
graduates starting up businesses. It should also be noted that the last five years have
seen the rapid implementation in Uzbekistan of the “Young entrepreneur as the
backbone of the nation” project. In 2010 alone, thanks to this project, 1,398 young
Uzbek entrepreneurs obtained preferential loans.

In the first quarter of 2011 the Government programme for the year of small
businesses and private enterprise has led to measures designed to bring more small
business owners into the Government procurement system,with a special telephone
hotline organized through the judicial authorities and a significant reduction in the
auditing of entrepreneurial financial and economic activities.
As a result of this, 170 small enterprises have been founded and begun trading;
these include 23 in textiles, 49 in the construction materials industry, 75 in the food industry, 2 in shoes and leather goods and 21 in other areas. The growth of small business output amounted to 117.8 per cent, significantly higher than the industry

Of particular practical significance is the decree of the President of the
Republic of Uzbekistan on additional measures for further reducing audits and
improving methods of monitoring entrepreneurial activity. This has introduced a
ban, from 1 April 2011 to 1 April 2014, on tax audits of the financial and economic
activity of small business owners who make timely tax and other compulsory
payments and run commercially viable operations.

Additional measures have been drawn up regarding expanding small business
owners’ and private entrepreneurs’ access to the Government procurement system,
in accordance with the Decision of the President of the Republic of Uzbekistan on
optimizing the Government procurement system and expanding involvement in it of
small business owners.

Additional measures regarding improvement of procedures and lowering the
cost of Government registration for entrepreneurs appear in the Decision of the
President of the Republic of Uzbekistan of 12 May 2011 on measures for further
improvement of organizational procedures and Government registration for

With the aim of expanding access for small businesses to financial and
material resources, loans made by commercial banks to owners of small businesses
and private enterprises rose to UZS865.9 billion.
Measures to expand access for small businesses and private enterprises to raw
material resources helped increase by 1.5 times the volume of goods sold on the
commodity markets by small businesses. The volume of output sold on the open
market by small businesses increased by 1.8 times. Small businesses’ share of
overall trading turnover amounted to 82 per cent.

Government support in the area of small businesses and private enterprise is
primarily designed to expand the property-owning middle class, which is a basic
pillar of Uzbek society, its well-being and the country’s current and future
development. It should also be emphasized that the Government programme being
implemented for the year of small businesses and private enterprise is in full accord
with and provides for the country’s comprehensive achievement of the United
Nations Millennium Development Goals.



Best entrepreneurs of Uzbekistan awarded

01.04.2011, Jahon News

The final stage of the republican contest Tashabbus 2011 for the prize of the President of Uzbekistan was held at the Turkiston palace in Tashkent.

The traditional contest among entrepreneurs, farmers and craftsmen was organized by the Commerce and Industry Chamber in collaboration with the Farms Association and the Hunarmand craftsmen association.

An exhibition of Tashabbus winners’ products was also organized within the event.

The process of selection of the contest winners has shown that entrepreneurs are effectively acquiring modern management methods, and the small business is actively developing in the country.

The current year has been proclaimed the Year of small business and private entrepreneurship, and a package of measures aimed at providing additional opportunities for entrepreneurs has been developed.

The share of the small and private business in the GDP and its role in economic development has been increasing from year to year.

If in 2000, the share of sector accounted for about 31% of GDP, in 2010 the figure made up 52.5%. Over 77% of the total employed population of the country currently works in the small business and private entrepreneurship sector.

According to chairman of the Commerce and Industry Chamber Alisher Shaykhov, over 6,400 entrepreneurs, farmers and craftsmen participated in this year’s contest. 41 winners of the regional stages competed at the final stage in the capital.

The best entrepreneur” title went to Bakhtiyor Umarov, head of Zamin Turkiston LLC, Namangan region. Nosir Turakulov of Surkhandarya region became “The best farmer”. Potter Sharif Azimov from Samarkand region was named “The best craftsman”.

The three first prize winners were awarded with gold medals and prizes of the President – Chevrolet Spark cars.

Second place winners received silver medals and UZS 6 million each, while third place winners got bronze medals and UZS 4 million.

Small business contributes to economic development


In the years of independence, small business and private entrepreneurship have really become the basis of the economy of Uzbekistan.

Wide opportunities of private ownership are reflected in the establishment of industrial production in rural areas, development of enterprises, filling domestic market with quality and competitive products, improvement of the service sector, and increasing employment and welfare.

The announcement of 2011 as the Year of small business and entrepreneurship by the President of Uzbekistan has opened opportunities for further expansion of activities in this direction.

Today, over 74% of Uzbekistan’s population are employed by small and private businesses.

The state is focusing its atention on the development of private sector, and providing benefits and incentives for its free activity.

The entrepreneurs of the country are making a worthy contribution to the improvement of the look of Uzbek towns and villages, and the welfare of the people.



Dear compatriots!
Ladies and Gentlemen!

These days the nation solemnly marks the 18th anniversary of adoption of the Main Law – the Constitution of the Republic of Uzbekistan.

Celebrating this truly historical date in the life of our state and our people, we give due to the everlasting role and significance, which the Constitution of the country has played in formation of the modern Uzbekistan, in achievement of the goal, which we have set before us from the early years of independence, i.e. to build a democratic law-governed state with socially oriented economy and establish the civil society, where the human being, his interests, his rights and freedoms are the most supreme value.

Today, objectively assessing and summarizing the outcomes of independent development of Uzbekistan, it is of no doubt that all the achieved goals and results recognized by the world community, which our country secured for over the past years, - both stably functioning economy, its sustainable growth rates, the year-to-year growth well-being of the population and strengthening authority in the world community, - all of these, first of all, are the result of implementation of the deeply thought-out objectives, principles and norms enshrined in the Constitution.

Shortly speaking, the life itself compellingly confirms the correctness of the country’s development model, which was chosen by us and enshrined in our Constitution that has gained the name of the “Uzbek model”.

As far we are moving away from the obsolete totalitarian, centralized, command, planning and distributive system as more we are getting convinced to what extent the principles and norms, on which our model is built, were right.

This is, first of all, full deideologization of our life, rejection of communist dogmas, rule of Law for all, maintaining by the state of the role of a main reformer, the choice of not a revolutionary, but evolutionary path, i.e. phased and gradual nature of reforms being carried out in line with the principle “do not destroy the old house until you build a new one”, as well as a strong social policy.

Guided by these principles, for over the past period in fact we have achieved a lot and can rightly be proud of this.

In my view, we have achieved the main thing, i.e. the process of reforming and democratization of the country acquired an irreversible and progressive nature.

The people, their social consciousness and their attitude towards life are changing. Their political maturity and civic responsibility for what is taking place in the country and the world are growing.

And all of this serves now as powerful moving force, which ensures onwards progression of the country along the path of progress and prosperity.

Along with this, while giving due to what was accomplished, we don’t have the right to forget that the life is always on the move.

Objectively and self-critically assessing the traversed path and the place of our country in the radical changes taking place in the world, we must not flatter ourselves with what was achieved and must not succumb to the feeling of euphoria and complacency.

In the century of globalization and increasing competition, in which we live now, only as a result of persistent and determined progression ahead on the way of cardinal reforms and modernization we can achieve the perspective goal, which we have set before ourselves, i.e. to join the ranks of developed democratic and flourishing states, provide our people worthy living standards.

It is these particular tasks which are set in the “Concept of further deepening the democratic reforms and establishing the civil society in the country”, enunciated at the joint session of chambers of our Parliament on November 12 this year.

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