EBRD to open new office in Uzbekistan on November 8

By bne IntelliNews November 7, 2017

The European Bank for Reconstruction and Development (EBRD) is to open a new office in Uzbekistan’s capital, Tashkent, on 8 November, the EBRD said in a statement on November 6.

The EBRD recently approved financing for two projects in Uzbekistan, marking the return of the development bank’s financing operations to the country since it halted work there in 2007. Since taking over from the late autocrat Islam Karimov in late 2016, Uzbek reformist President Shavkat Mirziyoyev has introduced economic and human rights reforms in an effort at attracting back foreign investors and breathing new life into the economy. In early September, currency controls were lifted in an effort aimed at securing an investment renaissance.

“The EBRD’s near-term objectives in Uzbekistan are to support domestic small and medium-sized enterprises and promote trade finance and cross-border cooperation, as well as to facilitate foreign direct investment and support the government’s reform efforts, including those aimed at improving the investment climate,” the statement said.

The EBRD board of directors is expected to announce a new country strategy for Uzbekistan in 2018 to set the bank’s “longer-term strategic priorities”.

Suma Chakrabarti, president of the EBRD, pledged to restart the multilateral lender’s activities in the country during a visit in mid-March.

The EBRD froze its links with Uzbekistan for 10 years because of Karimov’s poor human rights record, a split highlighted at a public stand-off between the dictator and human rights groups in 2003 at an event organised by then finance minister Rustam Azimov and the EBRD to attract foreign investment into Uzbekistan. The bank afterwards unsuccessfully attempted to pressure Karimov into addressing the country’s human rights issues and steadily wound down its investments until it closed its representative office in 2007.

The EBRD is sensitive to charges that it often turns a blind eye to dictators, so it is certain to proceed with caution. Nevertheless, the rise of Mirziyoyev has created the possibility of rekindling cooperation between the bank and the country.

The EBRD invested €894mn in Uzbekistan in 54 projects between 1992 and 2010.

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