COVID-19 and Trump’s indifference helped human rights abusers in 2020
Belarusian government sees $2bn of withdrawals, issues $580mn worth of bonds in 2020
Lukashenko: I am no enemy of the people
Storming parliaments: New Europe's greatest hits
One of Russia’s biggest wood product companies, Segezha could be Sistema’s next IPO
The volume of the Russian National Wealth Fund tops $183.93bn as gold overtakes dollar asset for first time
EU to begin certifying Russian Sputnik V vaccine for use in Europe
New Ukrainian VC firm QPDigital aims to invest up to $100 million in digital startups
EBRD investments reach record €11bn in pandemic-struck 2020
FPRI BMB Ukraine: Most Ukrainians are optimistic about 2021 – poll
OUTLOOK 2021 Lithuania
EBRD says loan to Estonia’s controversial Porto Franco project was never disbursed
Estonian premier quits after Tallinn development scandal
Top Centre Party official suspected of corruption in Tallinn real estate scandal
Czech Pirates and Mayors approve final coalition agreement for 2021 elections
OUTLOOK 2021 Czechia
BRICKS & MORTAR: Rosier future beckons for CEE retailers after year of change and disruption
Romanian tech entrepreneurs expand into banking sector
OUTLOOK 2021 Hungary
Hungarian government remains silent after Capitol riots
World Bank expects modest recovery for Europe and Central Asia in 2021
FDI inflows to CEE down 58% in 1H20 but rebound expected
OUTLOOK 2021 Slovakia
Slovakia to invest €1.2bn in digitisation
BALKAN BLOG: The controversial recipe for building up Albania
Heavy flooding causes chaos in parts of Southeast Europe
Vodafone Albania plans €100mn infrastructure investments after AbCom merger
OUTLOOK 2021 Albania
Kyiv accuses Bosnian President Dodik of lying about icon gifted to Russian foreign minister
Bosnia’s real GDP contracts 6.3% y/y in 3Q20
Sofia-based LAUNCHub Ventures holds first close of new fund on €44mn
ING THINK: Growth in the Balkans: from zero to hero again?
OUTLOOK 2020 Bulgaria
Labour demand down 28% y/y in Croatia in 2020
Zagreb Stock Exchange's Crobex10 index at highest level since March 5
OUTLOOK 2021 Kosovo
Arrera Automobili aims to launch Albania’s first supercar
World Bank revises projection for Moldova’s 2020 GDP decline to 7.2%
Moldova’s PM resigns to prepare the ground for early elections
Socialist lawmakers in Moldova scrap settlement on $1bn bank frauds
Montenegro’s new ruling coalition carves up top state jobs
OUTLOOK 2021 Montenegro
Vast tide of floating waste threatens Balkan hydropower plants
North Macedonia's manufacturing confidence indicator down by 8.5 pp y/y in December
OUTLOOK 2021 North Macedonia
Transparency International warns of high corruption risk in CEE defence sectors
Moldova fears flooding from Ukraine's planned Dniester hydropower plants
Romania’s industrial recovery paused in November
OUTLOOK 2021 Serbia
Slovenia’s opposition files no-confidence motion against Jansa cabinet
UK Moneyhub picks Slovenia for post-Brexit European base
Slovenia’s dire COVID-19 situation in 4Q20 caused second economic dip
Slovenia’s Eligma completes €4mn funding round
BEYOND THE BOSPORUS: Let’s tentatively pencil in a date for Turkey’s hot money outflow
Turkish opposition leader lawsuit demands one lira from Erdogan, police probe “bald” interior minister posts
OUTLOOK 2021 Armenia
Armenia’s PM cautions conflict with Azerbaijan “still not settled” after trilateral meeting with Putin
COMMENT: Record high debt levels will slow post-coronavirus recovery, threaten some countries' financial stability, says IIF
Russia, Kazakhstan pushing for oil production increases on the back of coronavirus vaccine-fuelled oil price optimism
OUTLOOK 2021 Georgia
Georgia’s political kingpin Bidzina Ivanishvili quits politics
Modern-day “Robin Hood” inspires Georgians drowning in debt
Iran’s navy conducts missile drill while analyst argues Trump even capable of nuclear strike in final days
TEHRAN BLOG: Who’s more credible? Johnson backing Trump’s Nobel chances or Iran applauding arrest warrant for US president?
STOLYPIN: Scope for limited progress under Biden, so long as the past remains the past
Central Asia vaccination plans underwhelm, but governments look unruffled
Fears of authoritarianism as Kyrgyz populist wins landslide and backing for ‘Khanstitution’
OUTLOOK 2021 Kyrgyzstan
Mongolia's winter dzud set to be one of most extreme on record says Red Cross
Mongolian coal exports to China paralysed as Beijing demands virus testing of truck drivers
Mongolia fears economic damage as country faces up to its first local transmissions of coronavirus
Mongolia in lockdown after suffering first local coronavirus transmissions
OUTLOOK 2021 Tajikistan
China business briefing: Not happy with Kyrgyzstan
OUTLOOK 2021 Turkmenistan
Turkmenistan: How the Grinch stole New Year
Turkmenistan: The dammed united
COMMENT: Uzbekistan is being transformed, but where are the democratic reforms?
OUTLOOK 2021 Uzbekistan
Uzbekistan’s Makro positions itself for growth in a more competitive market
Download the pdf version
The Uzbek government has been proactive in avoiding having any Covid-19 cases in the country thus far and the silver lining to its early stage financial development has made its equity market a golden hedge.
While in late January the government was already conducting temperature checks at international borders and airports, in February Uzbekistan Airways cancelled direct air travel between Uzbekistan and China and Uzbekistan and South Korea. Then the country banned the export of face masks to ensure ample domestic supply, while sending emergency medical supplies to China.
In late February Covid-19 cases were reported throughout the Middle East, namely in Iran, and after one case was reported in Afghanistan the Uzbek government has considered closing its border with the country to prevent any spread of the disease.
The government’s actions have thus far prevented any panic in the country aside from parents buying facemasks for their children, while grocery store shelves and the bazaars are fully stocked and functioning normally.
The Golden Hedge
Amid the global selloff in financial markets due to the Covid-19 virus, Uzbekistan’s economy and financial markets have been well insulated from the fallout due to it having a low correlation with the global economy, which we regard as one of Uzbekistan’s “golden hedges.”
This is because the country only opened in late 2016 and hasn’t had the time to thoroughly integrate with the global economy, though this will undoubtedly occur over the coming decade, just as happened in other Asian frontier markets such as Vietnam and Bangladesh.
In its early stage of growth, with the largest manufacturing and agro-industrial base in Central Asia, Uzbekistan is largely self-sufficient in many industries and is in fact a key exporter of value-added products to the region, including nuts, apples, cherries, textiles, fertilizers and etc. Therefore, the country can take its time integrating with the regional and global economy, while maintaining high growth in the process.
As the pace of exports accelerates from approximately $14bn in 2019, Uzbekistan’s foreign exchange reserves are likely to swell beyond their current $30bn and GDP per capita ($1,588 as of 2019) will be propelled higher, turbocharging the young domestic consumption story.
Uzbekistan’s second “golden hedge” is quite literally gold and its conservative fiscal policies. Being the world’s 9th largest gold producer, in February Uzbekistan reported that $16.59bn of its $29.9bn of foreign exchange reserves were in gold.
With high debt levels in developed and emerging markets and the Covid-19 virus giving Central Banks an incentive to explore ever more extreme forms of monetary policy, such as helicopter monetary policy, which is being implemented in places like Hong Kong (where on 26th February 2020 the Hong Kong government announced it would be giving HKD10,000, or $1,300 equivalent, to every permanent resident over the age of 18 in order to “stimulate” the economy), gold appears to be an increasingly valuable currency.
Uzbekistan has a remarkably strong balance sheet. With GDP of $53.8bn and an external debt to GDP ratio of only 40%, the country’s gold reserves at end of February stand at 33% of GDP, one of the highest such ratios in the world.
As Uzbekistan continues to privatize and liberalize its economy, perhaps in time the Tashkent Stock Exchange will evolve into a safe haven of attractive asset values and high growth and dividend yields for foreign investors, something quite plausible when considering how far Uzbekistan has come from its hard-line Soviet-style of rule experienced under former President Islam Karimov until 2016 when he passed away. Uzbekistan having transformed so greatly over the past three years, the coming three years will hopefully be as, if not more, transformative.
In related news the mining giant Navoi Mining says it will expand its gold production. Government owned Navoi Mining is targeting an increase in annual gold production to 94 tons by 2026 with an investment of $4bn.
The investment will be comprised of 40 projects, which will include the development of a new gold district. With proven gold reserves of 3,700 tons, and likely much more in inferred and undiscovered resource, this investment program aligns well with the government’s plan to conduct an international IPO sometime in the 2020’s.
here to continue reading this article
and 5 more for free or purchase
12 months full website access including
the bne Magazine for just $250/year.
Register to read the bne monthly magazine for
Password could contain only
and have 8-20 symbols length.
Please complete your registration by confirming your
A confirmation email has been sent to the email
address you provided.
can't be empty.
No user with
this email address.
Access recovery request has expired, or you are using
the wrong recovery token. Please, try again.
Access recover request has expired.
Please, try again.
To continue viewing our content you need to complete
the registration process.
Please look for an email that was sent to
with the subject line
"Confirmation bne IntelliNews access". This email will have
instructions on how to complete registration
process. Please check in your "Junk" folder in
case this communication was misdirected in your
If you have any questions please contact us at email@example.com
Sorry, but you have used all your free articles fro
this month for bne IntelliNews. Subscribe
to continue reading for only $119 per year.
Your subscription includes:
For the meantime we are also offering a free
digital weekly newspaper to subscribers to
the online package.
Click here for more subscription options,
including to the print version of our
flagship monthly magazine:
Take a trial to our premium daily news
service aimed at professional investors that
covers the 30 countries of emerging
For any other enquiries about our
products or corporate discounts please
contact us at
If you no longer wish to receive
Magazine annual print
Website & Archive
Combined package: web
access & magazine print
Take a trial to our premium daily news service
aimed at professional investors that
covers the 30 countries of emerging Europe: