Uzbekistan — Buyuk kelajak bo'lgan Davlat!

This blog is dedicated to providing rigorous analysis of current events in Uzbekistan. Debate and criticism are welcome, please inform me if you would like to offer a correction.


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Partial Privatization Scheme Fails to Spur Investment

In an effort to attract additional investment in the Uzbekistani economy, President Shavkat Mirziyoyev introduced an initiative in October 2016 to convert a number of leading firms into joint stock companies, with shares being sold to private investors to generate the capital needed for investment and necessary upgrades. The proposal made good sense, as large sectors of the economy in Uzbekistan remain state-owned and depend entirely on their own revenues or loans from state-owned banks and monetary funds to invest in improvements and modernization. This access to capital, however, is often limited. Although the government gives state-owned business preferential access to loans and, until recently, currency reserves, these enterprises still compete with each other, public works projects, and local and provincial government for a limited amount of available capital. By empowering state-owned companies to sell stocks, it was hoped that they could gain access to sources of private capital and investment, thus making them less reliant on state-owned banks and freeing up the government’s financial resources for greater investment in infrastructure, healthcare, education, and other social welfare projects.
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A New MXX Chief for a New Uzbekistan

The modern Republic of Uzbekistan emerged from the chaos of the early 1990s, and its particular character was formed in that crucible of prolonged and concurrent crises. From when Islom Karimov was pushed to power to appease nationalist protesters in June 1989, to the mid-1990s, Uzbekistan teetered on the precipice of societal collapse. Strikes had immobilized the economy, looting and hoarding of basic goods were common, local bureaucrats and mobsters had created petty fiefdoms in Buxoro and elsewhere, and the country still seethed with resentment at the Soviet government. By 1992, Tajikistan had collapsed into a civil war featuring insurgents from Afghanistan, and it looked like the Islamist movement there might hop the unguarded border and transform the simmering insurgency in the Farg’ona Valley into outright war. It was in this environment that the priorities of Islom Karimov and his old guard were molded. This world, thankfully, is gone, and Uzbekistan is now one of the safest countries on Earth. The behaviors and habits of this founding generation no longer fit the conditions of Uzbekistan, and they — like President Karimov himself — are now replaced by new men befitting a new age.
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Islamic Extremism and the Uzbeks

Uzbekistan has both a long and uncomfortable relationship with political Islam, recognizing to some degree the importance and political value of Islam in the creation of an Uzbek state separate from Russia, yet avowedly resisting Islamist strains of thought in contemporary politics. Most resistance to Russian conquest, beginning in the 1850s, was at least partially Islamist in nature: almost all groups fighting Russian influence justified their use of violence at least partially through Islamic jihadincorporated Islamic symbolism and motif into their rhetoric and propaganda, and depended on religious orders — most famously the Naqshbandi brotherhood — for logistics, support, and new recruits. These forms of semi-nationalist, semi-religious conflict — continuing throughout the period of Russian colonialism until the power of Sufi brotherhoods and rural landed elites was finally broken by the Toshkent Soviet and the radical reorganization of rural life — bear little resemblance to the modern internationalist forms of Islamic radicalism. The Islamic State of Iraq and the Levant (ISIS), Al-Qaeda, and others follow variations of an ideology broadly understood as takfiri Islam, which focuses on the responsibility of the faithful to convert or kill heretics and the sinful, referred to broadly as kuffar; this approach justifies the extreme violence of these groups towards those they view as kuffar. This form of Islamic radicalism, compared to that common during the 19th Century, is avowedly anti-nationalist and actively encourages the displacement of the borders and traditional government institutions which more traditionalist extremist groups might try to preserve or restore.

I write about Uzbek jihadists now, not out of idle interest, but because increasing numbers of Uzbeks are traveling to Iraq and Syria to join other misguided youths in jihad. Some international observers and media pundits have claimed that this demonstrates a failure on the part of the Uzbekistani government to prevent its youth from being radicalized, and in particular blamed the tight control of Islamic practice by the State Committee on Religious Issues for the surprising numbers of Uzbeks joining ISIS and Al-Qaeda. These statements are utterly misplaced and constitute a fundamental misunderstanding of the demographics of Uzbek radicalization. Almost all Uzbeks are radicalized while living abroad, and those who travel to engage in jihad almost always move through third countries to do so. If anything, Russia and the West should be looking towards Uzbekistan for inspiration about how to deter their own jihadis.
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Death and Dismissal in Newest Row over Economic Policy

Within a period of a week, Uzbekistan has lost two of its leading lights in the world of economics: Fayzulla Mullajonov and Rustam Azimov. The small amount of time elapsed between the death of the long-time Director of the Central Bank and the dismissal of Deputy Prime Minister Azimov is no coincidence; it is the result of a turbulent fight over the future economic policy of the Republic. Mr. Azimov was the head of a faction of Uzbekistan’s top economic leadership who sought to restructure Uzbekistani economic policy around Keynesian principles, a project which he hoped the reformist President Mirziyoyev would support.  Instead, just as under the Karimov administration, Mr. Azimov found his ambitions stymied by a conservative faction who wish to preserve the risk-adverse economic model designed by President Karimov. This conservative faction was headed by Dr. Mullajonov, who had run the Central Bank of Uzbekistan since its establishment in 1991 and had been a major engineer of the ‘Uzbek model of development’, and Mr. Azimov sought to take advantage of his death to advance his own economic agenda. Convinced of the rightness of the traditionally risk-averse economic policy, a point he believed he had made clear earlier that year during a rare public criticism of Mr. Azimov’s proposed budget, President Mirziyoyev dismissed Mr. Azimov for pursuing these projects instead of concentrating on his assigned duties. While tensions over budgets and economic policy have existed for years, Rustam Azimov — the former Minister of Finance and Deputy Prime Minister — is certainly the most high-profile casualty of the conflict.
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Uzbekistan and Russia Struggle for Leverage in Gas for Investment Deal

On 5 April, President Shavkat Mirziyoyev and President Vladimir Putin both emerged from the Kremlin declaring the complete success of Mr. Mirziyoyev’s first trip to Russia, the crowning jewels of which are a series of trade and investment agreements totaling $15.8 billion and a framework for the joint development of Uzbekistani gas and oil reserves. It is likely, however, that when the two smiling leaders left the Kremlin they rejoiced with two very different understandings of the arrangement that these documents created. The statements made by President Putin on 5 April make it clear that he understood most of the investment promised to be focused on the profitable oil and gas sectors, with Uzbekistan receiving investment so that the quasi-private clique of bureaucrats and businessmen who control energy markets in Eurasia can make fortunes by opening Uzbekistani oil and gas fields up to the world market. President Mirziyoyev, on the other hand, has emphasized elements of the agreement focusing on development projects and Russian investment in unprofitable areas of the economy, like agriculture, basic infrastructure, and manufacturing. How this investment money is spent will set the tone for Uzbekistani development during the Mirziyoyev administration, as it will test the resolve of Uzbekistani government to prioritize long-term development planning over the parochial interests of domestic elites and against Russian pressure. While petrochemicals still make up the core of the deal, as well as recent Uzbekistani agreements with Beijing, how the billions of rubles remaining are spent comes down to the commitment of the Mirziyoyev government to guide Uzbekistan on its own path.
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Gas Shortages in Toshkent City

Lines stretching around city blocks; angry shouts as station after station is forced to closed prematurely; gas prices doubling or tripling as desperate citizens shell out everything to get home: this is not the gas crises of the 1970s, but a reality of life in metropolitan Toshkent. Even without an OPEC embargo, gas shortages are an unfortunately regular occurrence in Uzbekistan. The most recent panic in Toshkent City in the week of 20 October highlights another unfortunate side effect of the byzantine administrative division between the capital territory of Toshkent City and the rest of the country. Despite being total self-sufficient in oil production and refinement, and expected to remain so for at least another 30 years at current levels at petroleum production, Uzbekistan consistently faces issues of temporary oil and gas shortages in Toshkent City. This consistent issue is not so much an issue of inadequate petroleum production, although infrastructure in that process does tend to be outdated and wasteful, but a combination of the difficulties inherent in accommodating market forces in a planned economic model, the administrative complexity of importing fuel into Toshkent City, and widespread hoarding by Toshkentchi eager to secure their own daily commutes.
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Border Controls Liberalized in Farg’ona Valley

The utterly lack of obvious natural barriers from one end of the Farg’ona Valley to the other belies a fiendishly complex system of territory division that carve up the flat expanse in defiance of geography, infrastructure, migration patterns, and logic. A mere 25 years ago, the Farg’ona Valley was traversable from Xujand to Jalal-Abat without obstructions of any kind, a situation enabled by the free movement allowed within the constituent republics of the USSR and reflected in the crumbling infrastructure of the modern republics. Even since the deteriorating security situation in Tajikistan and the Kyrgyz Republic raised the prospect of armed groups operating across the still porous borders — a danger highlighted by high profile kidnappings in Batken in 1999 — Uzbekistan has been the primary force in constructing and enforcing borders in the Farg’ona Valley, setting up arduous requirements for entry and trade, and even resorting to extreme measures such as land mines to prevent illegal crossings in high altitude areas. As pointed out by the Center for Preventive Action in their visit to the Valley, the intense securitization of the borders has caused numerous hardships to befall the already disadvantaged communities of the Farg’ona Valley, particularly those living in the border towns of Osh and Xujand. Under the temporary administration of Shavkat Mirziyoyev, the norm of strict border control that has lasted for nearly two decades appears to be eroding as the caretaker government has taken tentative steps towards normalizing border relations between Uzbekistan and the Kyrgyz Republic.
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