Clare Nuttall in Almaty -

In a bid to relaunch a privatisation drive knocked off track by the 2008 crisis, and reverse the consequent effects of fiscal stimulus, the Uzbek government says it is planning to sell almost 500 state owned companies and other assets within the next two years.

State Property Committee Deputy Chairman Saifitdlin Gafarov announced that a total of 497 assets in a range of sectors including the oil and gas, and energy sectors would be put up for sale through a new privatisation programme, according to reports in the Uzbek press.

A presidential resolution dated April 25 approves the State Property Privatisation Programme for 2012-2013. In addition to energy sector assets, the programme includes plans to sell companies in the metals, agriculture, light industry, electronics and pharmaceuticals sectors, Uzreport says.

A further 63 vacant and idle facilities will also be sold off. At a press conference in Tashkent, government officials insisted that the sell off will be conducted transparently via open auction.

The new plan is intended to expand Uzbekistan's private sector and attract foreign investors to revitalise the economy. Since independence, Tashkent has retained many of the assets it held at the end of the Soviet era under government control, although the early years of independence saw two waves of privatisation.

In the first, in 1992-93, Uzbekistan sold off the state housing fund and thousands of small and medium sized companies in the trade, light industrial and other sectors. Larger companies were sold off in the second wave in 1994-96.

However, major companies remain in government hands, and Tashkent has pursued a policy of economic self-reliance in recent years. This is in contrast to neighbouring Kazakhstan, which has sold off many major state owned assets and encouraged foreign investment, contributing to the country's economic boom through much of the last decade.

Tashkent previously considered privatising major state assets back in 2007-08, and hoped to find international strategic investors for companies such as Uzbekistan Airways as interest in frontier markets rode high. However, the sales were put on hold as the international economic crisis hit, and investors backed away from emerging markets.

According to the European Bank for Reconstruction and Development (EBRD), despite earlier privatisations, in recent years the state's role in the economy has increased. "State ownership in the economy remains dominant and has recently increased as the authorities undertook a large fiscal stimulus programme to support economic activity during and after the crisis," the EBRD's 2011 Transition Report says.

Uzbekistan also has a chequered history in its dealings with foreign investors. While the country has substantial natural resources - including large reserves of gas, gold and uranium - and the largest population in the Central Asian region, several investors have been burned in their dealings with the Uzbek government and state owned enterprises.

In 2011, Oxus Gold, one of the longest-standing international investors in the Uzbek mining sector announced that it had effectively been forced out of its joint venture Amantaytau Goldfields by its partners. Oxus' legal representative told bne that the Uzbek government had launched an audit of Amantaytau Goldfields operations that appeared to be intended to force the joint venture into liquidation.