Sunday, 16, June, 2024

Uzbekistan recently embarked on a transformative journey to modernize its economy and infrastructure. At the heart of this transformation are public-private partnerships (PPPs), which aim to harness the strengths of both the public and private sectors to deliver public services and infrastructure efficiently.

Last week I was in Tashkent and I took part in a candid roundtable on PPPs, organized by the Ministry of Economy and Finance with IFC’s support. We discussed the country’s achievements to date, as well as areas for improvement to help the government ramp up the program and bolster the country’s transformation.

Uzbekistan’s commitment to PPPs is clear. The government views PPPs as an essential part of its strategy to deliver improved public services and attract vital investment and expertise. Over 400 infrastructure projects harnessing the private sector’s capital and expertise have been developed, or are in development, in Uzbekistan. Together, they are worth an estimated $16 billion. This is an impressive number, because before 2018 there were no projects with private sector participation in Uzbekistan at all.

IFC has been instrumental in supporting these initiatives. Since 2018, together with the World Bank, we’ve been advising the government on how to open the power sector to private investment by implementing PPP projects that attract foreign capital efficiently and transparently. This includes Uzbekistan’s very first solar tender, which IFC helped structure—the Nur Navoi solar plant, which has resulted in very competitive tariffs.

Our current PPPs include projects at all stages of development in energy, healthcare, and education, with an overall expected mobilization of approximately $700 million. We’ve also closed several other projects in energy, healthcare, and the chemicals sector with a total expected mobilization of over $1.8 billion.

But there is still more that can be done. The government is now starting to turn its attention to other important sectors such as irrigation, transport, power distribution, and the supply of quality communal services—all strained by years of underinvestment, sub-optimal operation and maintenance, and rapid urbanization rates.

To move its PPP agenda forward, the country will need to:

  • Continue streamlining its project development processes;
  • Speed up approvals;
  • Implement simpler processes for land acquisition and right-of-way, among others.

We are also seeing, rightly, an increased focus on adopting the best environmental and social standards. That will require a certain level of capacity building among local counterparts.

Potential investors and private sector players will need governments to have the long-term vision, continuous political will, and commitment to introduce change, and know precisely where and how a PPP program can help achieve its goals. There are strong signs of this in Uzbekistan, which will greatly help the government to further promote sound PPPs.

The bottom line is that Uzbekistan has great potential to deliver new PPP projects to meet its Strategy 2030 goal of mobilizing $30 billion from the private sector by 2030. The synergy between the government's vision and private sector innovation promises to propel the country towards a future marked by prosperity and progress. For businesses and investors, this represents a unique opportunity to contribute to Uzbekistan's growth story while achieving sustainable returns—a win-win for all.

 

Wiebke Schloemer, IFC Director for Türkiye and Central Asia

Wiebke Schloemer 2023 2

 

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