Embassy of the Republic of Uzbekistan in the Kingdom of Spain

Tourism and public asset management projects presented

On May 27, President of the Republic of Uzbekistan Shavkat Mirziyoyev got acquainted with the presentation of tourism and privatization of state assets projects.

The coronavirus pandemic negatively affected the tourism industry. According to the forecast of the World Tourism Organization, by the end of 2020, international tourist trips will be reduced by 89 percent, 74 million jobs will be reduced, and the total losses in the industry will amount to $800 billion.

As is known, starting March 16 this year, Uzbekistan is closed to foreign and local tourists. As a result, more than 1.5 thousand tour operators and 1.2 thousand hotels have suspended their activities.

This seriously affected the income of more than 250 thousand people, including guides, artisans, workers of architectural monuments and spa facilities, catering facilities, transport and others.

A number of preferences were also provided to tourism industry to soften the effects of the pandemic. In particular, 1 750 entities were granted privileges on property tax, land and social taxes in the amount of about 60 billion UZS. But these benefits and preferences are temporary. For continuous sustainable development, it is necessary to learn how to work in a pandemic.

In this regard, foreign experience has been studied. A system of sanitary and epidemiological safety for tourists “Uzbekistan. Safe travel guaranteed” has been developed.

The Head of the state reviewed the presentation of this project. Information was also provided on plans for restoration and development of domestic tourism.

The President emphasized that first it is necessary to allow domestic tourism between regions with a green status. Instructions were given for organizing recreation centers in mountainous areas and on the coast of lakes using lightweight structures. Together with the khokims, the dislocation of recreation centers will be determined, the relevant data will be posted on the electronic portal.

At the second stage, it is necessary to create a list of countries with a stable situation on coronavirus and gradually restore tourist relations with them.

“To resume tourism, first of all, there must be a clear answer to a number of fundamental questions. For example, how hotels will work, how will they receive tourists at the airport, how to organize their movement within the country? Defined rules should be simple and at the same time sufficient to prevent the disease. It is necessary to develop a system that does not require quarantine of the entire hotel due to one case of infected”, said Shavkat Mirziyoyev.

Tourism entrepreneurs who have suffered losses due to the pandemic are unlikely to cover them in the next 1-2 years. In this regard, the President emphasized the need for providing additional benefits and preferences for this industry.

In particular, the previously granted exemption in the form of exemption from tourist fees will be extended until the end of the year. Enterprises of the industry, when calculating income tax, will be allowed to deduct losses incurred in 2020-2021 from the profits of subsequent years.

Hotels will be given subsidies in the amount of 10 percent of the cost of the services they provide. In addition, they will subsidize up to 10 percent of payments on loans allocated to working capital.

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Competition is one of the most important conditions for economic development. It provides the quality of goods and services, provides consumers with the opportunity to choose. It is these goals that the measures taken today to reduce the state’s presence in the economy and the fight against monopolies are pursuing.

Specific measures in this direction are defined in the Action Strategy for Five Priority Directions for Development of the Republic of Uzbekistan for 2017-2021 and the Decree of the President “On measures to radically improve the system of managing state assets, antitrust regulation and the capital market” of January 14, 2019.

Currently, there are 2 965 state-owned enterprises in the country. Most of them work inefficiently, using obsolete methods. More than half of these enterprises are not even able to pay dividends.

At the meeting held on December 11, 2019, the President instructed to reform these enterprises on the basis of market principles, sell them to private investors. In accordance with this, a bulk inventory of such objects was carried out.

Since the beginning of this year, 299 state assets worth 348 billion UZS have been sold. New investors invested a total of 3.3 trillion UZS in these facilities and pledged to create 4.7 thousand new jobs.

In particular, the former Chorsu Hotel, the Samarkandkimyo enterprise, the state share in Uzbekistan Hotel and Kungrad Soda Plant were sold. $425 million will be invested in these facilities. It is envisaged to create 800 new jobs.

During the presentation, information was presented on the plans for privatization of state assets, identification and effective use of vacant space and land, implementation of corporate governance in state enterprises.

The President emphasized the need for continuing activities in this direction, accelerating the transfer of another 1.4 thousand state assets to private investors. The Cabinet of Ministers was instructed to approve the privatization program.

The State Assets Management Agency and industry leaders were given instruction to liquidate 711 inefficient enterprises, reorganize 262 enterprises, as well as transfer over 500 markets to the private sector. The importance of introducing a new management system and reforming enterprises that remain at the disposal of the state was emphasized.