In this page: FDI in Figures | What to consider if you invest in Uzbekistan | Procedures Relative to Foreign Investment | Investment Opportunities
Reforms in Uzbekistan during recent years, such as liberalizing the foreign currency market and establishing seven special economic zones with tax breaks for investors, have made the country a more appealing destination for international capital. According to UNCTAD's World Investment Report 2024, FDI inflows decreased from USD 2.49 billion in 2022 to USD 2.18 billion in 2023 (-12.5%), but were still higher than the 2019-21 average (and up by 86% compared to 2016). At the end of the same period, the total stock of FDI was estimated at USD 14.8 billion, around 16.3% of the country’s GDP. In 2023, Uzbekistan’s economy absorbed over USD 30 billion in investment, with 13% coming from public sources and 87% from private or corporate sectors. This included USD 7.2 billion in FDI, led by China (25.6%), Russia (13.4%), Saudi Arabia (7.9%), Turkey (6.4%), the UAE (5.8%), and Germany (4.3% - data U.S. State Department). According to the Central Bank, foreign direct investment in Uzbekistan reached USD 11.9 billion in 2024. Investments in fixed capital rose by 27.6%, driven mainly by a 32.8% increase in non-centralised investments, whose share in total investment grew by 3 percentage points to over 90%. The main countries investing in Uzbekistan are China (more than 65% of the total stock), South Korea, Russia, Kazakhstan, and Turkey (data from U.S. Department of State), with the energy, metallurgy, and chemical industry being the primary sectors (data Ministry of Investment). Key FDI projects in recent years include the USD 2.4 billion, 1.5 GW Karakalpakstan wind project by Saudi Arabia’s ACWA Power—one of the world’s largest. While most FDI remains focused on energy and oil and gas, the government is expanding into new sectors. In September 2023, China’s BYD partnered with UzAuto Motors to produce electric vehicles, with the factory opening in July 2024. Uzbekistan has also become the top recipient of EBRD lending in Central Asia since 2020, further enhancing its appeal. The underbanked financial sector is attracting investment as digital banking and e-commerce gain traction.
Uzbekistan, situated in the heart of Central Asia, is an emerging lower-middle-income economy undergoing a significant transformation. Since the launch of an unprecedented reform program in 2017, the country has shifted from an isolated and highly centralized economy to one that is more welcoming to private investors and resilient against external factors. Investors are attracted by abundant raw materials and labour resources, direct access to markets across Central Asia, and various incentives and preferences, including state subsidies in some cases. Despite improvements in the legal framework, success in business still depends on support from the government due to weak contract enforcement and dispute resolution mechanisms. Uzbekistan's legislation, such as the Law on Investments and Investment Activities, ensures the free transfer of funds out of the country and protects investments from nationalization. Discrimination against foreign investors based on nationality, residence, or origin is prohibited by law. However, the government maintains control over capital flows in key industries, promoting investments in preapproved projects, particularly those focused on exports. The National Investment Program for 2023-2025, outlined in Presidential Resolution 459 of December 28, 2022, encompasses 768 projects valued at USD 55.4 billion. The Ministry of Investment, Industry, and Trade oversee the registration of investment projects, while the Investments Promotion Agency offers foreign investors consulting services, information and analysis, assistance with business registration, and other legal support. In 2022, the Government of Uzbekistan persisted in its efforts to diminish government intervention in the economy by privatizing state-owned enterprises and assets across various sectors including chemical, transportation, construction, and banking. Throughout the year, monopolies held by state-owned enterprises in the air transportation and chemical industries were effectively dismantled. Overall, Uzbekistan ranks 83rd among the 133 economies on the Global Innovation Index 2024 and 100th out of 184 countries on the latest Index of Economic Freedom.
Foreign Direct Investment | 2020 | 2021 | 2022 |
---|---|---|---|
FDI Inward Flow (million USD) | 1,728 | 2,276 | 2,531 |
FDI Stock (million USD) | 10,288 | 11,547 | 13,631 |
Number of Greenfield Investments* | 22 | 25 | 14 |
Value of Greenfield Investments (million USD) | 3,247 | 1,924 | 1,221 |
Source: UNCTAD - Latest available data.
Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.
- abundant and diversified natural resources (gas, gold, cotton, hydropower potential);
- low level of debt and comfortable foreign exchange reserves;
- ambitious public investment program;
- important size of the domestic market (population of 32 million)
- strategic position between China and Europe ("New Silk Road").
- low economic diversification and dependence on commodity prices;
- low competitiveness;
- underdeveloped banking sector;
- state interventionism and difficult general business climate;
- autocratic regime.
The state still reserves the right to export some commodities, such as nonferrous metals and minerals. In theory, private enterprises may freely establish, acquire, and dispose of equity interests in private businesses, but in practice, this is difficult to do because Uzbekistan’s securities markets are still underdeveloped.
Investment programmes were launched in order to encourage big investments in the priority sectors. Programmes include 86 foreign direct investment projects totaling 1.8 billion dollars, of which more than half is for the energy sector.
To encourage foreign investment, the Government provides tax incentives to joint stock companies for which foreign investment participation accounts for at least 15% of the authorised capital.
Private capital is not allowed in some industries and enterprises. The Law on Denationalization and Privatization (adopted in 1991, last amended in 2017) lists state assets that cannot be privatized, including land with mineral and water resources, the air basin, flora and fauna, cultural heritage sites, state budget funds, foreign and gold reserves, state trust funds, the Central Bank, enterprises that facilitate monetary circulation, military and security-related assets and enterprises, firearms and ammunition producers, nuclear research and development enterprises, some specialized producers of drugs and toxic chemicals, emergency response entities, civil protection and mobilization facilities, public roads, and cemeteries.
There are several other official limits on foreign investment. Foreign ownership and control are prohibited for airlines, railways, power generation, long-distance telecommunication networks, and other sectors deemed related to national security. Foreign nationals cannot obtain a license or tax permission for individual entrepreneurship in Uzbekistan.
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Latest Update: May 2025