Uzbek President Shavkat Mirziyoyev has called a snap presidential election to win a new mandate from the people to continue his reform blitz, after a referendum was held last month that will allow him to serve two more seven-year terms.

The  elections will be held on July 9 and Mirziyoyev is widely expected to be re-elected by a landslide. Since he took over in 2016, Mirziyoyev has introduced sweeping reforms that have seen the economy flourish, putting in the fastest growth in the region and experiencing a full-scale transformation. Mirziyoyev continues to enjoy genuine popular support and has promised to continue delivering on his reform programme.

In less than a decade, Mirziyoyev has managed to liberalise the economy and modernise the political system in Uzbekistan in contrast to his predecessor Islam Karimov, who presided over a repressive state. Uzbekistan has now become a substantially more convenient destination for foreign business and investment, as well as a more appealing tourism destination due to its well-preserved cultural heritage.

Economy flourishing

Part of Mirziyoyev’s planned reforms to make the economy run more efficiently is the privatisation of state-controlled assets. Several dozens of Uzbekistan’s largest companies are included into a privatisation list and consist of a number of banks, Uzbekistan Airways, copper producer Almalyk MMC, oil producer Uzbekneftegaz, natural gas pipeline operator Uztransgaz, steelmaker Uzmetkombinat, Navoi MMC, which operates the giant gold deposit Muruntau, and others.

Selling stakes in these companies will attract foreign investors as well as prompt the development of a local equity market, which is still small (with a total capitalisation of $5bn). It will also boost economic growth and provide budget funds for increased social spending.

Uzbekistan is not an oil exporting country, meaning it relies on exports such as gold, cotton products, copper, uranium, fruits and vegetables, which lead to comparatively less wealth for a nation.  As a result of large-scale reforms under Mirziyoyev, however, Uzbekistan’s gross domestic product (GDP) has been rising at an annual pace of more than 5%, and exceeded $80bn last year, and the country’s exports reached a record high of $19bn as well. Due to the ease of restrictions, Uzbekistan also attracted about $8bn of foreign direct investment (FDI) in 2022.

Mirziyoyev also turned the Uzbek soum into a fully convertible currency. This long hoped-for development brought about the end of the black market, where currencies used to be traded for a rate double that of the official dollar rate. That was a major headache for both citizens and foreign businesses and investors, who couldn’t repatriate their profits from the country.

Most notably, Mirziyoyev has eased bureaucratic barriers for entrepreneurs, reduced the tax burden and liberalised foreign trade. Combined, these measures have allowed Uzbekistan to advance to 69th place in the latest World Bank’s Doing Business ranking versus 146th place in 2013. Mirziyoyev’s focus on opening up to the international financial market allowed Uzbekistan to sell its first dollar-denominated bonds in 2019, paving the way for the country’s companies to sell foreign debt.

Political system

Shortly after his first election, Mirziyoyev surprised the international community by dismissing the once powerful head of the National Security Service, the successor to the Soviet KGB, and by releasing political prisoners, a rare move for many countries of the former Soviet Union. He then went on to restore bilateral relations with neighbouring countries in Central Asia, Kyrgyzstan and Tajikistan, which had been tense during Karimov’s rule. 

In addition, he is fostering ties with the US and Europe, which have political systems that his reforms presumably aim to model. At the same time, Uzbekistan maintains relations with China and Russia. Last year, Mirziyoyev hosted the Shanghai Cooperation Organization (SCO) summit in the city of Samarkand, which displayed Uzbekistan’s growing soft power in the Eurasian region.

A renewed presidential term would still pose new challenges for Mirziyoyev, however, like having to continue the fight against bureaucracy and corruption. Even though it improved its position, Uzbekistan ranks only 126th out of 180 countries in Transparency International’s Corruption Perception Index. To simplify the administrative system, Mirziyoyev told Parliament that he plans to reduce the number of federal ministries and agencies to 28 from the current 61, thereby removing redundant functions. The headcount of government employees will be gradually reduced by a third, making room for budget funds to be directed towards social projects.

In a popular vote in April, the country’s citizens backed a new constitution that proclaimed Uzbekistan a “social state”. This implies higher government spending to ensure high-quality education and medical services, and state support for low-income individuals and seniors, women and children, with the aim of reducing poverty levels.

Environment and society

In the past, Uzbekistan held a negative human rights record, with its recruitment of millions of citizens, including children, each season to harvest cotton, which was heavily crtiticised by human rights groups. One of Mirziyoyev’s most notable reforms has been the outlawing this forced labour, and allowing farmers, who were previously obliged to sell cotton to the government at a fixed price, to sell it to textile producers and create joint value-added chains.

Mirziyoyev also has plans to implement social projects aimed at increasing sustainability, improving the efficiency of the irrigation system and managing environmental phenomena like river inflows, which have been aggravated by climate change and can be damaging to both agriculture and hydropower plants (HPPs). Additionally, Uzbekistan is currently collaborating with China to install solar and wind energy capacity and aims for renewable energy to make up 30% of the country’s electricity capacity by 2030.

According to the Uzbekistan’s development strategy, Uzbekistan has set a target to nearly double its GDP per capita by 2030 to the equivalent of $4,000 and to create the preconditions for becoming an upper middle income country later, in order to raise the standards of living of the society. If Mirziyoyev is re-elected, his new term will end in 2030. The implementation of Mirziyoyev’s ambitious second stage of reforms and the creation of the New Uzbekistan depend on this upcoming election.