AGP Executive Report

Nature4Health: Uzbekistan has launched the Nature4Health scoping phase (Phase II) as a country partner, aiming to strengthen “One Health” links between ecosystem protection and primary pandemic prevention, with a focus on Karakalpakstan and Aral Sea-related environmental pressures. Culture & Creative Economy: President Mirziyoyev signed a decree creating the “Investments in Creativity” state targeted fund with an annual budget of 200 billion soums, plus broad tax incentives for culture and film/TV, and cash prizes to boost international competition participation. Regional Connectivity: Uzbekistan will host the second Termez Dialogue (June 4–6) to expand engagement with Afghanistan and advance transit, trade, and economic cooperation, with business talks involving the Afghanistan Chamber of Commerce and Investment. Film Industry Overhaul: Mirziyoyev also moved to reform Uzbekistan’s film governance by dismantling Soviet-style censorship bodies and shifting script/project review to professional expert groups, targeting 5–10 festival-competitive films annually. Air Links: Shirak Avia launched Yerevan–Tashkent–Yerevan direct flights, restoring connectivity after decades and supporting tourism and business ties.

Uzbekistan-Russia Energy Diplomacy: President Shavkat Mirziyoyev will visit Russia on June 4–5 for SPIEF and bilateral talks, including a planned meeting with Vladimir Putin and participation in the launch of Uzbekistan’s first integrated nuclear power plant construction. Renewables Investment: Uzbekistan’s Energy Minister said Saudi Arabia and the UAE have become key investor-partners in the renewable energy sector, while Chinese firms are shifting from EPC roles to direct project investment. Green Trade & Expo: Eco Expo Central Asia 2026 opened in Samarkand with participation from over 100 countries, and Uzbekistan also launched a biosafety initiative aligned with the Cartagena Protocol, funded by the Global Environment Facility. Financial Market Rules: The Central Bank reported eightfold growth in Islamic financial services via microfinance organizations, and Uzbekistan registered a new central clearing framework to strengthen settlement and reduce counterparty risk. Business & IP Push: The lower house adopted a draft constitutional law on the Tashkent International Financial Centre, and Mirziyoyev announced expanded support for the culture and arts sector plus stronger digital tools to protect intellectual property. Crime Crackdown: Prosecutors uncovered a UZS 35.1bn cashback fraud scheme in Andijan using fictitious invoices and Soliq Mobile. Connectivity & Tourism: Shirak Avia launched Yerevan–Tashkent–Yerevan flights, and Uzbekistan is pursuing deeper tourism cooperation with Hong Kong, including potential new direct air links.

Culture & IP Push: President Shavkat Mirziyoyev unveiled a wide package to revive Uzbekistan’s culture and arts, including expanded tax exemptions for private theatres, film and children’s content producers, and arts education, plus state reimbursement of up to 20% of concert/event costs from July 1 and free vouchers for hundreds of thousands of citizens. He also called for stronger copyright enforcement, with plans to use digital tools and AI to track creative assets and protect authors’ revenues. Anti-Fraud Crackdown: Prosecutors in Andijan say a tax cashback scheme used the Soliq mobile app and nine shell LLCs to generate fake invoices and receipts, allegedly embezzling UZS 35.1bn from the state. Energy Stability Focus: The Ministry of Energy said blackouts remain a priority to eliminate, but stressed that grid reliability also depends on more rational electricity use by households and institutions. Trade & Connectivity: Qatar and Uzbekistan chambers met in Tashkent to activate their Joint Business Council and target sectors like halal, while Uzbekistan will host a second Termez Dialogue on regional connectivity June 4–6. Business Climate Signals: Uzbekistan’s active businesses near 581,000, with trade the largest sector by number of enterprises.

Culture & Creative Economy: Uzbekistan is expanding tax incentives for the culture sector, exempting eligible organizations from VAT, profit tax, turnover tax, land and property taxes, and personal income tax, while also making sponsorship funds for literature, culture and the arts non-taxable; from 1 July, the state will reimburse up to 20% of regional concert and cultural event expenses, create regional directorates to manage venues, and issue free vouchers for 500,000 people plus 100,000 low-income families and children with disabilities. Film Industry Overhaul: The government will reform film governance by abolishing several state bodies and changing financing rules from 1 September, including allowing up to 30% of state-ordered budgets for promotion/advertising, ending mandatory expert review of procurement contracts, exempting foreign film companies from taxes, and allocating 50% of screening revenues from state-commissioned films to incentives for producers and creative teams. Trade & Exports: Ferghana region secured Malaysia market access for farm exports, with first air shipments of cherries and new apricots and peaches; separate Japan-focused efforts include deals for IT services worth $5m by end-2027 and expanded retail supply plans for Ferghana fruit to Costco and AEON stores in Japan. Business Climate & Compliance: The Tax Committee clarified how entrepreneurs can use a simplified VAT option (6%) from 1 June 2026, including voluntary choice rules and transition timing. Banking: Ipak Yuli Bank appointed Umidjon Khakimov as new chairman of its management board. Local Governance: Tashkent’s Sergeli district denied claims that the Sergeli car market will be demolished, saying modernization and infrastructure works are underway. Digital Government: Uzbekistan is discussing GovTech, secure data exchange, digital ID, AI in public services, and cybersecurity cooperation with Finland’s HAUS and Estonia’s ESTDEV, alongside telecom talks with Elisa on 5G and AI-driven network automation. Energy & Infrastructure: Uzbekistan’s energy minister said cooperation with Azerbaijan on the Green Energy Corridor is being strengthened, with targets for renewable capacity and clean electricity exports.

State Finances: Uzbekistan’s state debt climbed to $47bn by end-Q1 2026, up $4.4bn year-on-year, with 85% tied to external, mostly budget-deficit-related borrowing. Tax & Compliance: The Tax Committee reviewed 82 entrepreneur appeals over UZS 375.1bn in disputed penalties; it upheld most regional decisions (UZS 342.2bn) but granted partial relief to four businesses (UZS 600m adjusted/cancelled), while seven cases remain under review. Shadow Economy: The unobserved economy reached UZS 102.7tn in Jan–Mar 2026 (22.9% of GDP), split between informal household activity (UZS 69.1tn) and the shadow economy (UZS 33.6tn), with agriculture the biggest hotspot. Regional Trade & Connectivity: Kazakhstan and Uzbekistan signed a roadmap for trade and economic cooperation, covering industry, petrochemicals, logistics, agro, tourism and “green” energy. Aviation Links: FLYONE Asia launched new regular flights between Tashkent–Baku and Tashkent–Ganja, boosting Central Asia–South Caucasus travel and business ties. Environment & Funding: Uzbekistan hosted the GEF Council in Samarkand as the GEF-8 cycle ramps up, with delegates discussing $200m+ in new environmental and climate project funding. Creative Economy Support: Tashkent unveiled Uzbekistan Creative Park with tax and status incentives aimed at turning creative work into scalable businesses.

GEF in Samarkand: Uzbekistan is hosting the Eighth Global Environment Facility Assembly and the 71st GEF Council meeting, with final GEF-8 funding approved and new projects spanning biodiversity, water management and blended finance for renewable power and storage in Uzbekistan. Small business tax relief: A new presidential decree raises the VAT threshold for moving into the general tax regime (from UZS 1bn to 12,000×BCA) and introduces a simplified VAT option (6% flat) for eligible catering, trade and services firms from June 1. Uzbekistan Creative Park: Tashkent unveiled a Creative Park initiative to help creative professionals register as business residents and access infrastructure and support under the Law on the Creative Economy. Uzbekistan–Kazakhstan trade roadmap: Mirziyoyev and Tokayev signed an action plan covering cooperation in automotive, energy, chemicals, logistics, construction materials, housing and agriculture. Regional water pressure: Kyrgyzstan called for compensation mechanisms for shared water and energy resources as glacier melt accelerates across Central Asia. Cross-border agriculture trade: Rosselkhoznadzor clarified it has not imposed bans on Uzbek fresh fruit and vegetables, saying it will negotiate technical terms with Uzbek regulators. Business forum ties: Turkestan and Tashkent regions agreed to expand trade, investment and tourism cooperation and push joint industrial projects.

SME Tax Relief: Uzbekistan’s new presidential decree boosts small-business growth with a higher VAT entry threshold from June 1 (12,000× the Base Calculating Amount) and a simplified 6% VAT option for eligible catering, trade and services firms until 2030, easing reporting and corporate income tax. Energy Storage Push: Uzbekistan’s BESS capacity reached 1,545 MW, covering over 13.5% of evening peak demand, as the country expands renewables and storage to stabilize the grid. Trade Roadmap with Kazakhstan: Mirziyoyev and Tokayev signed a practical roadmap in Astana covering cooperation across autos, energy, chemicals, metallurgy, pharma, logistics, construction materials, housing and agriculture. Russia Fruit/Vegetable Import Rules: Rosselkhoznadzor says it has not imposed bans on Uzbek fresh produce, but it is clarifying technical talks after earlier confusion about temporary restrictions on 10 exporters. LPG Supply Shift: Uzbekistan sharply increased LPG imports from Russia to 231,000 tons in Jan–Apr 2026 (3.5×), aligning with rising regional energy demand. Corruption Crackdowns: Authorities detained suspects in bribery cases in Jizzakh and Ferghana, including alleged payments tied to land allocation and loan approvals. Pharma Enforcement: Large illegal medicine shipments were seized in Ferghana and Namangan, with authorities citing improper storage and unlawful circulation. Regional Connectivity: Uzbekistan will host the second Termez Dialogue on June 4–6 in Tashkent, focusing on peace, connectivity and climate adaptation for shared prosperity. Japan Partnerships: Ferghana region agreed partnership cooperation with Japan’s Tochigi Prefecture, while TEXNOPARK discussed potential escalator production expansion with Shanghai Mitsubishi.

EAEU Integration Push: Uzbekistan’s President Shavkat Mirziyoyev used the Supreme Eurasian Economic Council meeting in Astana to back closer EAEU ties, proposing a unified digital space for barrier-free trade and new steps on digital trade, industrial cooperation, transport connectivity and organized labor mobility. Small Business Tax Relief: Uzbekistan’s presidential administration says a new decree raises the VAT registration threshold from 1 billion to 5 billion soums, aiming to cut red tape and ease the tax burden on family businesses, cafés, retail and services. Russia Tightens Fruit/Vegetable Imports: Rosselkhoznadzor will temporarily restrict imports from 10 Uzbek exporters starting May 30, citing repeated phytosanitary violations and quarantine pest detections. WTO Milestone with India: Uzbekistan and India signed a protocol closing bilateral market access talks, a key step toward Uzbekistan securing full WTO membership before end-2026. Uzbekistan–Kazakhstan Trade Roadmap: A practical action plan was signed in Astana to implement investment and trade agreements, covering sectors from automotive and energy to logistics and agriculture.

Joint Venture Industry: JAC officially opened a joint-venture vehicle plant in Tashkent’s Yangi Avlod Industrial Park, displaying models from M3/M4 to JS8 and T9 as the automaker pushes deeper into Central Asia. SME Tax Relief: Saida Mirziyoyeva backed a decree raising the VAT registration threshold from 1 billion to 5 billion soums, aiming to cut inspections and reporting burdens and stop firms from splitting just to stay under the old limit. EAEU Integration Push: President Mirziyoyev, in Astana, outlined new initiatives for Uzbekistan–EAEU cooperation, including a single digital space for barrier-free trade and plans for closer work with the Eurasian Economic Commission. Trade Friction in Agriculture: Russia’s Rosselkhoznadzor imposed temporary fruit and vegetable import restrictions on 10 Uzbek exporters from May 30, citing quarantine pest violations and gaps in phytosanitary controls. Uzbek–Kazakh Investment Roadmap: Uzbekistan and Kazakhstan signed a practical action plan in Astana covering joint projects across autos, energy, chemicals, pharma, logistics, construction materials, agriculture and housing. WTO Milestone: Uzbekistan and India signed a protocol closing bilateral market access talks, with Tashkent aiming to secure full WTO membership before end-2026. Aviation & Tourism Links: Uzbekistan is in talks with China’s Spring Airlines about potential direct routes and joint marketing to boost Chinese tourist flows. Tech Adoption Snapshot: Microsoft data puts Uzbekistan’s generative AI usage at 7.2% of working-age people in Q1 2026, below the global average but rising. Energy Trade Watch: Uzbekistan increased LPG imports from Russia in Jan–Apr 2026, with deliveries to Uzbekistan up 3.5x year-on-year.

Small Business Tax Overhaul: President Mirziyoyev signed a decree easing the tax burden for SMEs, including a higher threshold for switching to general taxation and a simplified VAT regime from June 1 (6% VAT on turnover for eligible catering, trade and services firms, plus fewer audits). EAEU Diplomacy: Mirziyoyev arrived in Astana for a working visit and is set to take part in the Supreme Eurasian Economic Council meeting as an observer state, underscoring Uzbekistan’s push for deeper regional trade links. Trade & WTO Progress: Uzbekistan concluded WTO accession market-access talks with India, signing a protocol to complete negotiations and move the file toward WTO Secretariat submission. Infrastructure Push: A Chinese firm won a tender for a $2.185bn Tashkent–Samarkand toll highway, with construction planned to start in July; meanwhile, Tashkent signed $3.5bn in China deals for transport, urban and environmental projects under an EPC+F model. Green Economy & Agriculture: Uzbekistan and ICBA launched an Aral Sea region accelerator program for farmers and agri-entrepreneurs, backed by an Abu Dhabi Fund grant, targeting water scarcity and soil salinization. Pharma Incentives: New support measures will reimburse up to 50% of foreign consulting and international certification costs for domestic pharma manufacturers (capped at $50,000), starting June 1. Tourism Growth via Platforms: Uzbekistan is expanding promotion through digital travel platforms, including Fliggy (Alibaba) and Trip.com, reporting rising Chinese interest and tour purchases. Aviation Connectivity: FlyKhiva will start regular Termez–Istanbul–Termez flights twice weekly from May 30, boosting access for Surkhandarya tourism and business travel.

Uzbekistan–China Deals: Tashkent signed more than $3.5bn in Xi’an agreements with Chinese partners under an EPC+F model, covering BRT lanes, overpasses, drainage and residential projects, with repayments planned via new city revenue sources. New Airport Push: Negotiations continue for the New Tashkent international airport targeting 20m passengers/year, with a 208,400 sq m terminal and two 4km runways; work has started on relocating utilities and canals. Toll Road Tender: A Chinese firm won a $2.185bn tender to build the Tashkent–Samarkand toll motorway (282 km), with construction set to start in July. Trade & Exports: Uzbekistan’s foreign trade hit $26.3bn in Jan–Apr 2026, but the trade deficit widened to $6.4bn as imports rose and gold exports fell; non-gold exports and services grew. Crypto Regulation: The regulator revoked UzNEX’s operating license, setting out refund channels for users. Car Market Shift: UzAuto Motors’ share slipped below 50% (47.8% Jan–Apr), while BYD, Chery and KIA gained. Tourism Marketing: Uzbekistan is boosting China-focused tourism via Alibaba’s Fliggy and Trip.com partnerships, citing rising Chinese interest and tour purchases. Afghan Trade: Uzbek private firms signed trade deals with Afghanistan worth $5bn+ over eight months, spanning food, cotton, textiles and pharmaceuticals. Regional Integration: Mirziyoyev will attend the EAEU summit in Astana as an observer, as Uzbekistan deepens Eurasian cooperation.

New Development Bank Membership: President Shavkat Mirziyoyev signed Uzbekistan’s formal joining of the BRICS-backed New Development Bank, signaling fresh development-finance options as the country pushes a massive 2026 infrastructure and industrial pipeline. SME Tax Relief: Mirziyoyev also signed a decree to make small business rules more favorable from 1 June, including a higher threshold for moving to the general tax system and VAT administration tweaks for catering and related sectors. Exports & Trade: Uzbekistan’s foreign trade rose 5.8% year-on-year to $26.3bn in Jan–Apr, with exports down but non-monetary gold exports up, while imports climbed and the deficit widened. Crypto Crackdown: Uzbekistan’s regulator revoked the crypto exchange license of KOBEA GROUP (UzNEX), with a refund contact process set out for affected clients. Digital Connectivity: Viasat demonstrated direct-to-device satellite messaging in Uzbekistan, aiming to extend reliable communications to disconnected areas. Telecom Efficiency: Ucell and ZTE rolled out an AI-powered RAN energy-saving solution across Uzbekistan’s network, boosting energy efficiency by 10.6%. Tourism Push via China: Uzbekistan promoted tourism at ITB China Shanghai and discussed cooperation with Fliggy, citing a 40% rise in interest and 20,000+ Chinese tourists booking packages in 2025. Eurasian Export Support: The Eurasian Development Bank agreed to back Uzbekistan exporters through technical assistance for certification, standards, and market entry.

SME Tax Relief: President Mirziyoyev signed a decree making it easier for small businesses to grow, including a fivefold jump in the simplified-tax threshold to 12,000 base calculation units from 1 June and a voluntary 6% VAT option for catering, trade and services. Energy Pricing Shift: Uzbekistan will move away from state-regulated coal prices from 1 June, shifting to market-based pricing via exchange trading, while gas and electricity tariffs rise but prepaid households get limited protection (up to two months for residents, one month for businesses). Capital Controls Easing: The Central Bank proposed higher limits and simpler procedures for overseas investment-related transfers, including higher annual ceilings for private and state-linked firms. Crypto Crackdown: NAPP revoked the crypto exchange license of KOBEA GROUP (UzNEX), with a dedicated refund channel and a 3–10 working day processing window. Trade Momentum: Foreign trade hit $26.3bn in Jan–Apr (+5.8% y/y), with exports down but non-monetary gold exports up, and China remaining the top partner. Export Support: The Eurasian Development Bank will back Uzbek exporters with technical assistance for certification and market entry. Tourism Push to China: Uzbekistan promoted tourism at ITB China Shanghai, with talks on boosting Chinese visitor flows and digital platform cooperation (Fliggy). Digital Connectivity: China Mobile International plans a new Central Asia-to-Hong Kong submarine-cable route via Kazakhstan and Uzbekistan to improve bandwidth and redundancy. Regulatory Overhaul from 1 June: New rules take effect across pharma, customs facilitation, digital transformation, procurement and anti-corruption.

Logistics Expansion: Rohlig SUUS Logistics has opened a new Uzbekistan subsidiary in Tashkent to offer end-to-end road, rail, air and sea freight, warehousing and customs brokerage—aimed at capturing Central Asia’s fast-growing logistics demand. Trade & Markets: Uzbekistan resumed non-monetary gold exports after a seven-month pause, shipping $1.503bn in April 2026; the restart helped, but the external trade deficit still widened sharply year-on-year. State Asset Privatization: An e-auction on E-auksion sold a 70% state stake in Namangan-based UzChasys (automotive lighting) for 332.96bn soums, with a 10-year business continuity requirement. SME Policy: President Mirziyoyev reviewed reforms to support small business, including raising the turnover threshold for moving to the general tax regime from 1bn to 5bn soums from June 1, 2026, plus a proposed simplified VAT option for select sectors. Inflation Outlook: The Central Bank of Uzbekistan reported inflation expectations falling to 10.6% in its April survey, with regional and occupation gaps still visible. Uzbekistan–China Growth: Uzbekistan and China signed a green energy science cooperation memorandum in Xi’an, while talks also covered pharma/biotech investment and localization.

Trade Boost: Afghanistan and Uzbekistan say private-sector deals worth $5B+ were signed in eight months, lifting bilateral trade from about $400–500M to $1.5B, with a push toward nearly $5B in 1–2 years. SME Credit Push: President Mirziyoyev reviewed plans for a digital lending platform that would let SMEs apply online, get offers from multiple banks, and choose terms faster—aiming to cut today’s up to 7-day processing. State Asset Sale: Uzbekistan sold a 70% stake in UzChasys via e-auction for 332.96B soums. Gold & Inflation Signals: Non-monetary gold exports hit $1.503B in April; meanwhile inflation expectations fell to 10.6% in the central bank survey. Food Price Control: Retail chains were warned to avoid unjustified hikes ahead of Kurban Hayit. Corruption Crackdown: Tax inspection staff in Tashkent’s Bektemir district were detained over alleged bribery tied to cash-receipt violations. Green Energy & Pharma: Uzbekistan and China expanded cooperation on renewables and discussed pharma/biotech projects.

Education & Talent Pipeline: Chungnam National University opened a Korean Language Education Center in Tashkent, a first step toward launching its full Korean-taught campus in the city later this year, with students set to study the first two years in Uzbekistan before moving to Korea for graduation. SME Finance Push: President Mirziyoyev backed a plan to expand SME lending via a new digital financial platform that lets entrepreneurs apply online, compare offers from multiple banks, and use AI-based scoring from Dec. 1, 2026. Water Infrastructure as an Economic Asset: Mirziyoyev also reviewed measures to save water and prevent mudflows, citing concrete canal and irrigation upgrades that are already improving supply and bringing more farmland back into use. Trade & Connectivity: A major Hong Kong business mission led by Chief Executive John Lee is scheduled for June 3–5 to deepen trade and investment links, while China Mobile plans another Central Asia-to-Hong Kong submarine cable connection. Agribusiness Acceleration: ICBA and Uzbekistan’s innovation agency launched a farmers’ and agro-entrepreneurs accelerator in Karakalpakstan to build crop value chains and market access.