The writer is the minister of investment, industry and trade of the Republic of Uzbekistan.

In the 9th century, a man born in Khiva, Uzbekistan, effectively invented the systems upon which so much science and technology hinges: algebra and the algorithm. The scale of Al-Khwarizmi’s contribution to our collective knowledge and understanding of the world is incalculable. For a golden period in the middle ages, Uzbekistan served as a crucible of intellectual and scientific progress, stimulated by influences carried on the Silk Road connecting east and west. 

Uzbekistan has led the world’s scientific and technological discussions in the past, and many of us in the country are growing in confidence that our state can once more assert its role in a global tech and research market.

Aspirations for a tech-oriented economy might have seemed fanciful a generation ago, but they are now credible and even compelling. Ambitious market reforms, as well as a concerted privatisation programme — all underpinned by significant investments in tertiary Stem education — are modernising Uzbekistan’s economy and investment profile. 

What’s more, with the average age of its 37 million people being 29, our country is instinctively digital and understands tech’s value in the future economy. The continuing development of local banking and capital markets is also encouraging the growth of a domestic, capital-hungry start-up ecosystem.

From algebra to unicorns

The success of Uzbekistan’s ongoing pivot to digital and tech industries is best evidenced by the meteoric success of Uzum, an e-commerce start-up focused on fintech, online shopping and food deliveries which in March became the country’s first tech unicorn. 

If the momentum of investment reforms such as the free currency float and investment code can be maintained — and the recommendations of a recently-launched investment policy joint analysis by the EU, OECD and Asian Development Bank are implemented — there is every reason to expect more unicorns to emerge from among Uzbekistan’s more than 1000 start-ups. 

Less trendy, but an invaluable area of growth in Uzbekistan’s economy, is the near-exponential expansion of its IT sector. This has been driven by the government-led establishment of IT Park Uzbekistan, which has seen the country begin to assert itself as a rising IT outsourcing destination. Businesses across central Asia and beyond have been attracted by the hub’s financial incentives, such as a 0% corporate tax rate, and a business environment calibrated to attract foreign investment. 

Testament to IT Park’s success, there are now 426 foreign IT firms with operations in Uzbekistan, up from just 14 in 2020. Over the same period, the value of IT product and service exports has risen from $16.3m to $344m. 

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The new golden age

Here in Uzbekistan, our reinvention — or rather rediscovery — as a tech and science hub for the region is yielding some impressive results. However, it would be naïve to assume that the pace of reform, or the scale of change, is sufficient to deliver the growth that our country is capable of. While the World Bank has praised a reform agenda that places “the well-being and prosperity of the people at its centre”, it also notes that the country’s transition from the large role played by state-owned enterprises to a market economy “is only just beginning” and that “economic transformation has progressed slowly for most of the past 30 years”. 

In some ways, frustration about the rate of our economic reforms is inevitable. The liberalising milestones that have been achieved — such as the purchase of Ipoteka Bank by Hungarian OTP Bank — have demonstrated significant benefits, and it’s understandable that commentators wonder: “Why the hold-up?” But here again, history offers a glimpse of the thinking that dictates Uzbekistan’s conservative and cautious approach to change: this is a region that remembers the experience of other post-Soviet states transitioning their economies. 

The World Bank describes Uzbekistan’s “late embrace of comprehensive reform” as a silver lining, noting it can draw from “lessons learned from the successes and failures of other transitions around the world”. We are a country committed to real, radical reform, but also determined that this transformation be methodical, steady, and careful. 

Uzbekistan is once more rising as a centre of technological and commercial achievement, and the world’s investors — from North America and Europe to China and the Gulf — are beginning to take note.

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