Coverment and economy

For several years now, the Government of Uzbekistan has stated that it is committed to a gradual transition to a free market economy. Very recently, the government signed an agreement with the IMF to move toward current account convertibility. If implemented, these steps will move Uzbekistan toward a market economy, although much structural reform is needed, particularly in the area of improving the investment climate for foreign investors and in freeing the agricultural sector from smothering state control. Until now, continuing restrictions on currency convertibility and other government measures to control economic activity have constrained economic growth and led international lending organizations to suspend or scale back credits.

• For several years now, the Government of Uzbekistan has stated that it is committed to a gradual transition to a free market economy. Very recently, the government signed an agreement with the IMF to move toward current account convertibility. If implemented, these steps will move Uzbekistan toward a market economy, although much structural reform is needed, particularly in the area of improving the investment climate for foreign investors and in freeing the agricultural sector from smothering state control. Until now, continuing restrictions on currency convertibility and other government measures to control economic activity have constrained economic growth and led international lending organizations to suspend or scale back credits.
• The government has made some progress in reducing inflation and the budget deficit, but government statistics understate both, while overstating economic growth. There are no reliable statistics on unemployment, which is believed to be high and growing.

• GDP and Employment
• The government claims that the GDP rose 4.5% in 2001. Unemployment and underemployment are very high, but reliable figures are difficult to obtain, as no recent credible surveying has been done. Underemployment in the agricultural sector is particularly high--which is important given the fact that 60% of the population is rural-based. Many observers believe that employment growth and real wage growth has been stagnant, given virtually no growth in output.