Uzbekistan’s key priorities for the great improvement of transport corridors in Central Asia

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Over the previous four years, Uzbekistan beneath the management of President Shavkat Mirziyoyev has been finishing up systemic reforms aimed toward liberalizing and modernizing the nationwide economic system, making certain its sustainable improvement and constant integration into world financial relations. Improving the competitiveness of manufactured merchandise and the nation’s export potential are recognized as crucial priorities on this route.

According to official knowledge, on the finish of 2019, Uzbekistan’s international commerce turnover amounted to $42.2 billion. However, amid the pandemic disaster in 2020, this determine decreased by 13.1% (in comparison with 2019) – to $36 billion, At the identical time, in accordance with ADB forecasts, in 2021 GDP progress will quantity to five.8%, as reforms will stimulate progress in agriculture, trade and providers.

The measures being applied in Uzbekistan to modernize the economic system, present complete assist and stimulate exports, and guarantee sustainable progress in its volumes require the event of further measures to create favorable situations for additional diversification of international commerce routes, the formation of other best transit corridors that present the nation’s export merchandise to promising worldwide markets.

According to specialists from the worldwide firm Boston Consulting Group, Uzbekistan occupies a strategic location in Central Asia and has a developed transport infrastructure. In their opinion, within the subsequent ten years, the funding potential of Uzbekistan will quantity to $65 billion, of which as much as $20 billion can be spent on non-resource industries.

In 2020, the quantity of worldwide transportation of products of the Republic of Uzbekistan has already amounted to 47.1 million tons, of which: export – 13.Three million tons (+ 17.2%), import – 24.7 million tons (+3, 1%), transit – 9.1 million tons (+ 15.3%)

In order to extend the transport and logistics potential of the nation, the institutional framework and the regulatory framework for this trade are being strengthened. In explicit, by the decree of the Head of Uzbekistan dated February 1, 2019, the Ministry of Transport was created, which is outlined as a authorities physique for the event and implementation of a unified state coverage within the improvement of street, rail, air, river transport, metro, and street services.

As a part of the implementation of the “Comprehensive program for improving transport infrastructure and diversifying foreign trade routes for the transportation of goods for 2018-2022” systematic work is being carried out to develop new transport and transit corridors and a community of logistics facilities, increase the fleet of automobiles and plane, create situations for environment friendly transportation and dealing with of products in Uzbekistan in neighboring international locations.

In addition, the “Strategy for the development of the transport system of the Republic of Uzbekistan until 2035” is presently being developed, which envisages the creation of situations for the expansion of volumes and high quality of passenger and freight visitors, enchancment of the transport sector administration system, in addition to the introduction of essentially new approaches to coaching, retraining and superior coaching of employees within the transport system.

A decree by the President of the Republic of Uzbekistan – No.UP-5647 – from February 1, 2019 “On measures to radically improve the system of public administration in the field of transport” stipulates the event of a draft Law of the Republic of Uzbekistan “On Transport” transport right into a single transport community and the usage of environment friendly transport and logistics programs.

It can be vital to notice the entry into drive from April this 12 months for Uzbekistan, a particular system of preferences of the European Union for sustainable improvement and good governance (GSP+), the place our republic was accepted as a beneficiary nation. It provides further alternatives to extend commerce between the EU and Uzbekistan, as tariffs on a variety of vital export items equivalent to textiles, clothes and plastic merchandise can be eliminated. In addition, throughout the framework of GSP+, the nation can import greater than 6.2 thousand items with out duties. This will give a robust impetus to draw traders, primarily from the EU international locations, to the implementation of promising initiatives in Uzbekistan, in addition to kind a strong foundation for diversification and accelerated improvement of commerce and financial relations between Uzbekistan and the EU international locations.

In these situations, the event of transport corridors in Central Asia, able to connecting transport corridors passing alongside the North-South and West-East routes, is of explicit significance.

However, the area nonetheless retains elements that negatively have an effect on the event of transport communications. According to the specialists of the worldwide firm Boston Consulting Group, although Central Asia is a area with nice transit potential within the world transport system, the issues noticed within the interplay of the international locations of the area in utilizing current communications hinder the efficient use of those alternatives. Most of the issues come up from the dearth of a standard technique among the many international locations of the area. In addition, such issues because the transport isolation of the area, non-diversified transport routes, in addition to the unstable state of affairs in Afghanistan stay related.

World Bank specialists word that the international locations of Central Asia haven’t but realized the large potential of home and international commerce. This requires an built-in approach to enhance transport connectivity inside and between the international locations of the area, which can contribute to a rise within the GDP of the international locations of the area by 15%.

At the identical time, within the absence of direct entry of the international locations of the area to seaports, in accordance with specialists, greater than 90% of freight visitors in intercontinental commerce between Asia and Europe is carried out by sea. This imposes an extra price on the beginning worth of the exported and imported items.

According to UN Secretary-General Antonio Guterres, the merchandise of nations removed from the ocean are virtually not represented on worldwide commerce markets. These international locations account for lower than 1% of world exports. According to UNCTAD, for Central Asian international locations, transport prices in lots of circumstances reach 60% of the worth of imported items.

According to the estimates of the Institute of Central Asia and the Caucasus at John’s Hopkins University, transport isolation significantly hinders the financial progress of the Central Asian international locations. This contributes to the event lag behind the maritime states by 20%. At the identical time, the quantity of GDP when it comes to buying energy parity is decreased to 57%. The important losses are incurred by Uzbekistan, which should overcome the territory of the 2 states to enter world markets. 

At the identical time, greater than 23 million containers are transported yearly to China, Southeast Asia and Europe. However, only one% of them are transported by rail, 99% by sea.

All this requires the consolidation of efforts on this route with the participation of the international locations of the area and worldwide organizations. It is vital to emphasise {that a} sturdy assure of sustainable improvement and prosperity in Central Asia is the will for cooperation and the duty of all international locations within the area for a standard future. Practical affirmation of that is the concrete political and diplomatic steps taken by Uzbekistan over the previous four years in key areas of cooperation, primarily within the transport and communication sphere.

Today in Central Asia, strengthening cooperation within the transport sector acts as an vital software for the event of social and financial relations, contributes to the free motion of products and providers, in addition to bettering the situations and high quality of lifetime of the inhabitants.

Currently, transport initiatives, that are the motive force of financial prosperity for the whole area, are being efficiently applied in a trusting and pleasant environment.

As you realize, the President of Uzbekistan recognized the primary priorities of Uzbekistan within the improvement of transport corridors in Central Asia. First, the implementation of transport and communication initiatives that enable connecting Central Asia with the most important seaports and world markets; secondly, the formation of a trans-Afghan hall with entry to South Asia, in addition to the development of the China-Kyrgyzstan-Uzbekistan railway line; third, additional improvement of transit potential and improve within the transport part within the nationwide economic system.

Already in the present day, Uzbekistan has managed to take sensible measures to reach agreements with neighboring international locations on the implementation of latest infrastructure initiatives. In explicit, in recent times, street, aviation and rail hyperlinks with Afghanistan, Kazakhstan, Kyrgyzstan, Tajikistan and Turkmenistan have been actively growing.

Uzbekistan and Tajikistan resumed air visitors, restored the Galaba-Amuzang-Khoshady railway. The operation of eight car and one railway checkpoints has been restored. The commissioning of the restored part of the Uzbek-Tajik interstate railway line Amuzang-Khoshady can play an vital position within the improvement of transit visitors, in addition to create further alternatives for Tajikistan to enter Turkmenistan and Afghanistan.

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Uzbekistan has upgraded integral components of its freeway community to assist create a regional transport hall in Central Asia. FLICKR

Uzbekistan and Turkmenistan have constructed the Turkmenabad-Farab railway and street bridges, that are vital corridors of the Uzbekistan-Turkmenistan-Iran-Oman transport and transit route. This transport hall has expanded as a result of becoming a member of of Kazakhstan and India, giving the international locations of the area entry to the Indian Ocean. The hall is designed to attach Central Asia with Iranian ports within the Persian and Oman Gulfs.

Uzbekistan and Kazakhstan have launched bus routes, high-speed rail hyperlinks.

At the identical time, greater than 23 million containers are transported yearly to China, Southeast Asia and Europe. However, only one% of them are transported by rail, 99% by sea.

All this requires the consolidation of efforts on this route with the participation of the international locations of the area and worldwide organizations. It is vital to emphasise {that a} sturdy assure of sustainable improvement and prosperity in Central Asia is the will for cooperation and the duty of all international locations within the area for a standard future. Practical affirmation of that is the concrete political and diplomatic steps taken by Uzbekistan over the previous four years in key areas of cooperation, primarily within the transport and communication sphere.

Today in Central Asia, strengthening cooperation within the transport sector acts as an vital software for the event of social and financial relations, contributes to the free motion of products and providers, in addition to bettering the situations and high quality of lifetime of the inhabitants.

Currently, transport initiatives, that are the motive force of financial prosperity for the whole area, are being efficiently applied in a trusting and pleasant environment.

The implementation of the outlined precedence duties in these strategic paperwork sooner or later will present important help in bettering the regulatory framework for cooperation within the discipline of transport, growing the effectivity of implementing the transit potential of the Commonwealth of Independent States (CIS), growing worldwide transport corridors within the CIS area, growing the effectivity of the agreed tariff coverage within the discipline of worldwide railway transportation and the implementation of a coordinated coverage within the discipline of transport safety, in addition to fixing problematic points on this space.

Important initiatives of Uzbekistan are additionally being raised throughout the framework of the Shanghai Cooperation Organization (SCO). Uzbekistan views the SCO as a promising platform for increase cooperation within the discipline of transport and logistics. More than 13 million km of highways (about 20% of all world highways) and about 250 thousand km of railways have already been laid within the SCO area, which contributes to the event of regional transport connectivity.

The big transit potential of Central Asia is evidenced by the truth that in 2019 China imported items price greater than $2 trillion {dollars}, and from the SCO international locations – solely $100 billion. At the identical time, Chinese President Xi Jinping says that in 15 years China will import $30 trillion. It must be famous that the gap of transportation of products from China to Europe via Central Asia is 2 instances shorter than by sea, and a couple of.5 instances shorter than alongside the transport hall via Russia.

It must be famous that in the present day there are 61 railway routes within the Europe – China route, and 84 routes from China to Europe. More than 85% of transit containers go via Kazakhstan, whereas visitors volumes via Russia and Mongolia are declining. Another rising route of transit is from China via the Kazakh Saryagash to the international locations of Central Asia and Afghanistan. In the context of the coronavirus pandemic, within the first 9 months of 2020, container shipments alongside the China-Europe route amounted to 388 thousand models (a rise of 61% in comparison with the identical interval in 2019).

To increase mutually helpful commerce between the SCO member states, create new and enhance current transport and logistics infrastructures within the title of the widespread pursuits of the SCO member states, President Mirziyoyev, in his speeches on the conferences of the Council of Heads of SCO member states, put ahead a variety of initiatives aimed toward consolidation of efforts of the SCO members within the transport sector.

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An Uzbekistan Airways 767-33P(ER) parked at Tashkent Internation Airport after delivering medical provides from Beijing to Uzbekistan. FLICKR

At a gathering of the Council of Heads of SCO Member States (Qingdao, China, on June 10, 2018), it was proposed to think about the opportunity of establishing an International Transport and Logistics Association of the SCO. In addition, the Qingdao Declaration of the Council of Heads of SCO Member States (June 10, 2018) supported the holding of the primary assembly of the heads of railway administrations of the SCO member states in Uzbekistan. At a gathering of the Council of Heads of SCO Member States in Bishkek (June 2019), the President of Uzbekistan proposed to develop an SCO cooperation technique to develop interconnectedness, efficient financial and transport corridors.

The initiatives and proposals of the Head of Uzbekistan discover vast assist among the many SCO member states. A putting instance is the approval, throughout a gathering of the Council of Heads of Government of the SCO states, in Tashkent in November 2019, of the idea of interplay between railway administrations of the SCO Member States, developed on the initiative of President Mirziyoyev.

It can be vital to notice that Uzbekistan considers cooperation with the Caspian states as one of many precedence instructions of its international coverage technique and is thinking about giving new dynamics to multilateral relations. Using the transit potential of the Baku-Tbilisi-Kars railway will enable the Central Asian international locations to diversify transport instructions. This mission will play a key position in establishing common transportation of products from Turkey and Europe to the international locations of Central Asia and China.

In common, the formation of an intensive transport and communication system in Central Asia will totally understand the transport and transit potential of the area and could have a multiplier impact for the sustainable improvement of Central Asia.

In this regard, the sensible implementation of the initiatives of President Mirziyoyev, put ahead at world and regional boards, particularly throughout the framework of the UN, SCO, and CIS is buying particular relevance. The initiatives of the federal government of Uzbekistan voiced on the worldwide convention “Central Asia in the system of international transport corridors: strategic prospects and unrealized opportunities” in Tashkent in 2018 are additionally in demand. In explicit, on the event of a technique for the event of regional transport corridors in Central Asia, the adoption on its foundation the regional Program for the sustainable improvement of the transport system of Central Asia and the formation of a regional council for transport communications of the international locations of Central Asia, which can grow to be a coordinating construction in fixing the issues of the transport and logistics sector.

The sensible and systematic implementation of those initiatives will make an excellent contribution to the formation of a standard transport area in Central Asia, in addition to improve the competitiveness of worldwide transport corridors passing via the territories of the states of the area.

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