Uzbekistan simplifies business access to subsidized loans for job creation

New measures are being introduced in Uzbekistan to expand entrepreneurs' access to subsidized financing, and some requirements for those receiving loans are being abolished. District and city headquarters are granted the authority to independently allocate funds for projects aimed at creating stable jobs and increasing household income.

This presidential decree establishes new rules for the development of small businesses and increasing household incomes. The district and city headquarters will have access to a total fund exceeding 3.2 trillion UZS, sourced from various sources.

These funds include 1.37 trillion UZS from family entrepreneurship support programs, 450 billion UZS for youth business, 240 billion UZS from the Poverty Reduction Fund, and 100 billion UZS from the Employment Promotion Fund.

Entrepreneurs who bring families from the Social Register into cooperation can obtain unsecured loans. Each household is allocated 50 million UZS, with a maximum amount reaching 5 billion UZS. Starting October 1st, the headquarters will begin compensating part of the interest on bank loans for small and medium-sized businesses, as well as for self-employed individuals. The Company for Entrepreneurship Development is responsible for implementing the subsidies.

Furthermore, the headquarters will be authorized to manage funds from the 'Sahovat va Kumak' funds, as well as the youth and women's 'notebooks,' totaling 760 billion UZS. Starting January 1, 2027, the criteria for including families in the Social Register will be determined by a point system that will take into account factors such as income, presence of chronic diseases, disability, migration, and number of children, allowing families to receive necessary social support.

The State Social Security Fund will also begin providing childcare benefits to female employees under employment contracts, starting from the end of maternity leave until the child reaches one year of age. It should be noted that entrepreneurs willing to build kindergartens, schools, and technical colleges, as well as provide free education for children from low-income families, will be offered land plots in auctions with a starting price of 1 million UZS.

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Major Universities and Medical Centers in Uzbekistan are Being Transformed into Business Societies to Attract Investors

Uzbekistan plans the gradual transformation of major higher education institutions and republican specialized medical centers into business societies. This process will allow for the attraction of private investors, including the possibility of selling stakes in these institutions.

This initiative is driven by a new presidential decree that stipulates a reduction in the state's share in the economy. The document details the phased commercialization of the work of such organizations and the attraction of private capital.

The changes will affect a number of other state institutions. Organizations engaged in commercial activities are required to be transformed into business societies by December 1, 2026. However, exceptions will be made for institutions whose activities are related to performing managerial, socio-cultural, or other non-commercial functions.

Furthermore, in sectors where a competitive environment already exists, a ban will be introduced on the creation of new state structures unless they are financed from the state budget. This restriction does not apply to structures responsible for defense and security, nor to individual cases permitted by presidential decisions.

Previously, the 'Most Innovative Idea' competition started in Uzbekistan for students of state universities. At the republic level, winners of this competition will have the opportunity to receive up to 500 million soms to implement their projects.

podrobno.uzSeptember 3, 10:27

Significant Disparity in Poverty Reduction Program Effectiveness Identified in Uzbekistan Across Regions

A substantial heterogeneity in the effectiveness of applying credit resources aimed at combating poverty has been discovered across different regions of Uzbekistan. It was established that in some districts, a significantly larger number of citizens were successfully lifted out of poverty despite similar levels of financial support.

Meeting Details

Shavkat Mirziyoyev presented this information during a meeting dedicated to advancing the poverty reduction and income increase program to a new stage. Over the past year, 86 thousand small enterprises were established in the regions; however, the proportion that ceased operations reached 17%, totaling 15 thousand units. Furthermore, 62 thousand citizens who received bank loans faced difficulties in running their businesses and are experiencing problems with debt repayment.

Comparison of Indicators in Districts

The most obvious differences are observed when comparing individual districts. Sharof-Rashidovsky and Karshinsky districts each received 2.3 trillion soms. In Sharof-Rashidovsky district, 30 thousand people were lifted out of poverty, corresponding to an average indicator of 78 million soms per resident. In Karshinsky district, this figure was 13 thousand people, while the expenditure per person reached 176 million soms.

The situation in Kamashinsky and Psakent districts demonstrates an even greater contrast. Both districts received 1.1 trillion soms, but 28 thousand people were lifted out of poverty in Kamashinsky district, whereas only 4.5 thousand were in Psakent. This implies that approximately 250 million soms in credit funds were allocated per person in Psakent.

President's Conclusions and Khorezm Region Experience

At the meeting, President Shavkat Mirziyoyev emphasized that results vary greatly across regions even when conditions are identical. He noted that some leaders lack both the knowledge and the resolve for the competent use of available resources and the stimulation of job creation.

A report on the work in the Khorezm region was presented separately. Over two weeks, an assessment of the situation of 81 thousand low-income residents, belonging to 19 thousand families, was conducted there. The analysis showed that 12 thousand of these residents are unemployed, and 10 thousand have a low income level. Additionally, local businesses require about 9.5 thousand employees.

According to state structures' estimates, it is possible to increase the income of 10–15 thousand representatives of poor families due to the availability of vacancies and vocational training programs. Previously, the Hokim of Bukhara region, Botir Zaripov, stated plans for the complete elimination of poverty in the region by the end of 2026.