Republic of Uzbekistan: Staff Report for the 2021 Article IV Consultation— Informational Annex

Uzbekistan embarked on an ambitious reform path in 2017, starting to liberalize its economy after years of state control. Incomes are still relatively low compared to other emerging economies. Uzbekistan entered the COVID-19 crisis with relatively strong macro-economic fundamentals.

Abstract

Uzbekistan embarked on an ambitious reform path in 2017, starting to liberalize its economy after years of state control. Incomes are still relatively low compared to other emerging economies. Uzbekistan entered the COVID-19 crisis with relatively strong macro-economic fundamentals.

Title Page

REPUBLIC OF UZBEKISTAN

STAFF REPORT FOR THE 2021 ARTICLE IV CONSULTATION— INFORMATIONAL ANNEX

April 6, 2021

Prepared By

The Middle East and Central Asia Department (In consultation with other departments)

Contents

  • FUND RELATIONS

  • RELATIONS WITH OTHER INTERNATIONAL FINANCIAL INSTITUTIONS

  • STATISTICAL ISSUES

Fund Relations

As of March 31, 2021

Membership Status

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General Resources Account

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SDR Department

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Outstanding Purchases and Loans:

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Latest Financial Commitments

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Projected Obligations and Projected Payments to the Fund:

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Implementation of HIPC Initiative: Not Applicable

Implementation of Multilateral Debt Relief Initiative (MDRI): Not Applicable

Implementation of the Catastrophe Containment and Relief (CCR): Not Applicable

Exchange Rate Arrangements

Uzbekistan accepted the obligations of Article VIII Sections 2(a), 3, and 4 of the Fund’s Articles of Agreement with effect on October 15, 2003 and maintains an exchange system free of restrictions on the making of payments and transfers for current international transactions. With the exchange rate unification in September 2017, as well as the adoption and implementation of regulations liberalizing the FX regime in Uzbekistan, two exchange restrictions and one MCP that had been maintained inconsistently with Article VIII obligations were eliminated. Since then, Uzbekistan maintains an exchange system free from restrictions on the making of payments and transfers for current international transactions. FX is generally freely available for payments and transfers for current international transactions without undue delay.

According to the authorities, the de jure exchange rate arrangement is floating. The exchange rate is determined daily based on the supply and demand for foreign currency established on Uzbekistan’s currency exchange. The Central Bank of Uzbekistan (CBU) is a direct buyer of monetary gold produced in Uzbekistan, acting as a supplier in the foreign exchange market in amounts equivalent to the volume of gold purchased from producers. The CBU also intervenes in the foreign exchange market to smooth out undue short-term volatility. Foreign exchange sales by the CBU in the FX market are not directed at affecting the fundamental trend of the exchange rate and are driven exclusively by the aim of sterilizing additional liquidity from CBU purchases of monetary gold. The de facto exchange rate arrangement is classified as crawl-like.

Article IV Consultation

The Republic of Uzbekistan is on the standard 12-month Article IV consultation cycle. The previous Article IV consultation was concluded on May 9, 2019.

Safeguards Assessment

The CBU has not undergo ne a safeguard assessment, which is expected to be initiated in FY22.

Resident Representative

A resident representative for Uzbekistan was appointed in December 2020. A resident representative office was previously open in Tashkent from September 1993 to April 2011.

Technical Assistance Missions

May 2019 to March 2021

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Relations with other International Financial Institutions

As of March 31, 2021

Asian Development Bank:

European Bank for Reconstruction and Development:

World Bank Group:

Statistical Issues

As of March 31, 2021

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Table of Common Indicators Required for Surveillance

As of March 31, 2021

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The date for the latest observation and the date received reflect when data was transmitted to the area department.

Daily (D); Weekly (W); Monthly (M); Quarterly (Q); Annually (A); Irregular (I); Not Available (NA).

Any reserve assets that are pledged or otherwise encumbered should be specified separately. Also, data should comprise short-term liabilities linked to a foreign currency but settled by other means as well as the notional values of financial derivatives to pay and to receive foreign currency, including those linked to a foreign currency but settled by other means.

Foreign & domestic bank and domestic nonbank financing.

Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds.

The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.

Currency and maturity composition are not reported regularly.