October 29, 2007

Economics:
Debates on new legislative initiatives
UAE signs investment and tax deals with Uzbekistan
Attracting investors instead of borrowing money
Draft of new edition of Tax Code discussed
Innovation-2007 intl scientific conference held in Tashkent
Society:
New publication "UN and Uzbekistan: partners in development" released
Uzbekistan to hold mass vaccination against measles, rubella in November
All the best things for children

ECONOMICS

DEBATES ON NEW LEGISLATIVE INITIATIVES

The Lower Chamber of the Parliament launched a sequential plenary session. Discussions have unfolded on nine draft laws seeking to make amendments to the current legislation and a new draft law “On the securities market”, Uzbekistan Today (UT) newspaper reported.

In the third reading deputies adopted the draft law “On amendments and additions to the Law of the Republic of Uzbekistan “On natural monopolies”, which will be transferred to the Senate. As was commented to UT by a member of the Committee on the Budget and Economic Reforms Sharbat Abdullaeva, the new amendments and additions will concern services of transport terminals. One of the amendments introduces the term “the transport terminal” and simultaneously determines that the work of transport terminals is regulated by the state. The legislator also provides an opportunity for structures occupying the position of state monopolies to develop and carry out programs of re-structuring, which provide allocation from structure of state monopolies of the competitive enterprises and their subsequent privatization.

“An addition is also being made on the control function of subjects of natural monopolies. It entitles institutions and individuals, state bodies and economic management to address with a complaint in case of infringement of the legislation on natural monopolies in the State Committee on Demonopolization, Support of Competition and Entrepreneurship. Also according to the new addition, subjects of natural monopolies acquire the right to independently reduce prices for products, goods and services with the notice of the Ministry of Finance. At the same time the reduction of prices should not be selective for separate consumers, but for all simultaneously” underlined the Deputy.

Members of the same committee proposed a draft law “On additions to some legislative acts of the Republic of Uzbekistan with a view of improvement of investment conditions”. The document is developed with in an effort to draw active investments into the real sector of economy by maintenance of optimal conditions for investors.

The new legislative initiative provides modification and additions in the Tax Code and in the Law “On execution of judicial certificates and certificates of other bodies”. As the vice-president of the Committee on the Budget and Economic Reforms Ravil Sabirjanov has explained, changes will concern means and property, entered as investment obligations which will not be a subject to taxation on income and the VAT, and the tax on development of the social infrastructure and accomplishment of the territory. Also during the whole investment period according to the concluded contract of sales and purchases means and property introduced investors will not be a subject of compulsory repayment of the past debts of the enterprise.

Later the discussion developed on the presented draft law “On ratification of the Contract between the Government of the Republic of Uzbekistan and the Government of the Islamic Republic of Pakistan on mutual legal aid on criminal cases (Tashkent, March, 14th, 2007)”. Deputies have noted the importance of the document for development of the international relations, in view of the brought offers the draft law has been adopted in the first reading.

Deputies have begun a clause-by-clause reading of the draft law “On the securities market”, whose task is the definition of activity of professional participants of the securities market, the order of regulation and supervision of the securities market and protection of the rights of investors and owners of securities. In the agenda of the plenary session were also such issues, as increase of the state provision of pensions of citizens, modification in Civil Remedial Codes, the Law “On seed-growing” and the draft law “On the securities market”.

UAE SIGNS INVESTMENT AND TAX DEALS WITH UZBEKISTAN

On October 26 this year the Vice President, Prime Minister of the United Arab Emirates (UAE), the Ruler of Dubai Sheik Muhammad Bin Rashid Al Maktoum paid an official visit to Uzbekistan, the local newspapers reported.

The same day the government of the Republic of Uzbekistan and the government of the United Arab Emirates signed the agreement on avoiding the double taxation of incomes and preventing the capital tax evasion, promotion and protection of investments, as well as the protocol of cooperation and consultations between the foreign ministries of the two countries.

Also, on October 26 Sheik Muhammad Bin Rashid Al Maktum visited the Mustakillik (Independence) Square and laid flowers to the Independence and Humanism Monument – the symbol of the Uzbekistan’s freedom, bight future and noble aspirations.

He is reported to have assessed the profound creative and betterment work accomplished at the Independence Square led by the Uzbek Leader. According to him, such grandiose complex witnesses about considerable reforms held in the country and enormous potential of the Uzbek people.

ATTRACTING INVESTORS INSTEAD OF BORROWING MONEY

The Uzbek President Islam Karimov has approved the Republic’s investment program for 2008. It is intended to invest US$ 1.435 billion on 79 investment projects due to attracting foreign capital next year. The share of investment in industry will be 60% of total foreign capital, according to the newspaper Uzbekistan Today.

More than 65% of total foreign capital falls to the share of oil and gas, chemical industry, metallurgy and textile industries. The industrialization remains main priority of investment policy of the country and the efficiency of investments in this sector goes up. It is aimed to invest US$ 413.45 million on 37 projects of planned amount at the expense of foreign credits under the government’s security and US$ 1.022 billion on 42 projects at the expense of foreign direct investment.

In recent years the attraction of foreign investment has focused on the oil and gas sector. The Uzbek government predicts that then in last two or three years textile and communication remain more significant sectors for foreign direct investments.

The basic investment aspects of oil an gas companies who plan to invest US$ 628.6 million in 2008 are conducting prospecting works and launching new oil and gas fields. For instance, in 2008 Russia’s “Gasprom” will invest US$ 105 million in prospecting works in Ustyurt region having total investment of US$ 260 million for the period of 2006-2008.

Another Russian company, “Lukoil” wants to rank second after the “Gasprom” in gas production. While realizing these plans, the “Lukoil Overseas” will offer to implement a project worth around US$ 2 billion on developing the gas fields in Kandim group in Bukhara region and prospecting in Ustyurt.

Next year the Chinese CNODC (the CNPC’s section) will continue exploring in five oil and gas units worth US$ 208.5 million by late 2010. The Malaysian Petronas will finish exploring the Boisun investment unit totally estimated at 47.8 million in Surkhandarya region in the south of Uzbekistan. Another Russian company, “Soyuzneftegaz” will continue implementing a project worth US$ 462 million on developing the deposits in Ustyurt and South Gissar.

Pumping gas this year from one of the fields of Bukhara-Khiva group, the Swiss “Zeromax” will go on implementing a project worth US$ 400 million. Simultaneously the company began exploring and drilling in Tagam-Shimoliy Tandirchi zone of Gissar region in the south of Uzbekistan.

It is intended to invest next year around US$ 161 million foreign direct investment and credits of the China Development Bank for further expanding and modernization the networks of mobile and mail communication by buying new technological equipments.

An active attraction of direct investment in the industrial sector of economy allows the country to concentrate its efforts of attracting credits and loans under the government’s security on implementation of projects in social, agrarian, land-reclamation and communication spheres. Particularly, it is aimed to invest US$ 50 million in healthcare. This capital will be invested in the implementation of “Health 2” Project with the World Bank and Asian Development Bank and equipping various healthcare establishments of the country with medical equipment with the support of the Islamic Development Bank and Kuwait Fund for Arab Economic Development. In the education sphere US$ 80 million will be spent on the construction and equipment schools and professional colleges and integrating information communication technologies with various international finance institutions.

Thus, a balanced investment policy for attracting direct foreign investment in the real sector of economy and promotion of this process with integrated system of benefits and preferences will allow the country, in turn, to support actively its social projects and its positive credit reputation among the international financial organizations.

DRAFT OF NEW EDITION OF TAX CODE DISCUSSED

The Committee for Budget and Economic Reforms of the Legislative Chamber of Oliy Majlis (parliament) of Uzbekistan held a seminar on the draft of the new edition Tax Code, UzA reported.

The chairman of the Committee A. Ahadov presided at the meeting. Among the participants were the members of the Legislative Chamber, the representatives of concerned ministries and agencies, committees and departments and individual entrepreneurs.

It was noted that the draft of the new edition of the code was prepared based on the tasks outlined in the report of the President of Uzbekistan Islam Karimov at the joint meeting of the Legislative Chamber and the Senate on 28 January 2005.

It was emphasized that in the taxation practice attention should be given not only to the levying of taxes, but first of all to the motivation of taxpayers towards the development of their production, not to allow tax evasion, or concealing of income.
The draft of the code includes improved norms and rules regulating the issues of taxation and reflects all taxes and mandatory payments paid by individuals to the state. Moreover, this draft code takes into account the conditions for all sectors of the country's economy.

The draft of the code is based on the existing principles of taxation, the advanced international experience and world best practices. It was noted that wide integration of the norms and rules envisaged in the new code into practice would lead to the development of the Uzbek taxation system and increase the stimulating role of taxes in the development of the country's economy.

During the seminar reports were delivered on the main approaches to the development of the draft of the new edition of the Tax Code, its advantages compared to the existing code, the fulfillment of the tax obligations, income tax, and simplified procedure of taxation. Recommendations were made on further improvement of the draft of the new edition of the Tax Code.

INNOVATION-2007 INTL SCIENTIFIC CONFERENCE HELD IN TASHKENT

The development of an innovative economy based on the advanced scientific and technological solutions, and the integration of science and production required for this process were discussed during the Innovation-2007 International Scientific Conference held on 25 October at the Tashkent State Technical University named after Abu Rayhon Beruni.

The event was organized by the Ministry of Higher and Secondary Specialised Education of Uzbekistan, the Uzbek Department of the International Academy of Sciences, the inter-industrial Centre of Strategic Innovations and Informationsations, and several other agencies.

Among the participants of the meeting were the representatives of higher educational institutions, scientific-research institutes, large industrial enterprises, and the developers of advanced technology from Uzbekistan, Belarus, Germany, Kazakhstan, Kyrgyzstan, Russia and Ukraine.

The solution of this strategically important task of the intensification of the processes of country's innovative development set by President Karimov largely depends on the efficiency of the cooperation between the educational, scientific and production structures. The basis for the expansion of this interaction for the purpose of increasing the competitiveness of the national economy, and preparation of new format specialists is successful implementation of the National Staff Development Programme being implemented on the initiative of the head of state.

In light of this, as mentioned during the conference, special attention is being given to the development of the process of innovation. Innovation is a basic resource of economy. Uzbekistan has a huge, and internationally recognized scientific-technical and intellectual potential. Its efficient use would allow the Uzbek nation to solve the key problems related to the construction of the new society, to become a reputed participant of the world economic relations. The integration of advanced technology into production, the launch of export-oriented goods, the expansion of import-substituting production is largely determined by the increased innovative culture of the society, the establishment of the national system of innovation.

Every country's national innovation system is unique, but the structure of all of them is similar and includes different sorts of state and regional organizations, some scientific institutions and enterprises, techno-parks, which contribute to the development and integration of new technology. That is why it is important to develop international cooperation in this sphere, to share the experience and information available.

One of the major links forming the national system of innovation of Uzbekistan is the Navoi Mining and Smelting Kombinat (NGMK), the example of which illustrates the efficiency of the integration of knowledge, science and production. The NGMK constantly modernizes its production, establishes close contacts with the higher educational institutions preparing the staff it may require, and works together with them to prepare the specialists according to the requirements of modern production. The company has its study-scientific-production complex, where the staff is trained.

This example was discussed and commented on by the rector of the Tashkent State Technical University Sh. Shoobidov, the Director of the Centre of Strategic Innovations and Informatisation A. Kadyrov, the Chief Engineer of the NGMK P. Shemetov, the Director of the Ukrainian Centre of Information and Computer Systems A. Vernal, the Deputy Rector of the Ural State University of Communication Routes V. Antropov, the Professor of Saint Petersburg State Electro-Technical University I. Gerasimov and other conference participants.

They also discussed the issues concerning the improvement of staff development, the involvement of talented students in research and development, the expansion of the process of innovation in different sectors of the economy, the development of ICT, the integration of modern automated systems to manage technological processes and objects.

SOCIETY

NEW PUBLICATION "UN AND UZBEKISTAN: PARTNERS IN DEVELOPMENT" RELEASED

The United Nations Office in Uzbekistan on 24 October released a publication entitled "UN and Uzbekistan: partners in development", a press release of the UN Tashkent office said.

It gives a brief overview of support that the UN and its programmes and agencies have been providing to Uzbekistan's development since 1993. These are UNDP, UNICEF, UNFPA, UNODC, UNESCO, WHO, and UNAIDS.

The publication reveals that the UN agencies bring in not only a wealth of resources, but also a unique combination of experience and skills gained by the Organization over the years of development work throughout the world. Each agency has its own mandate and area of expertise and thus complements each other's activities.

The UN agencies implement in Uzbekistan a comprehensive portfolio of projects that aim to advance economic and social reforms, to improve living standards and quality of health and education, to strengthen democratic institutions and broaden public participation in development processes, to protect the environment and the unique cultural heritage of Uzbekistan as well as to help enhance human resources capacity in all these priority development areas. In doing so, the UN system cooperates with a wide range of partners, including the Government, donor organizations, civil society, academia and the media.

Special attention is paid to the UN contribution in advancing the goals of the 2007 Year of Social Protection. Through technical advice and projects, the UN in Uzbekistan facilitates the Government's efforts to increase efficiency of the national social protection system.

Working in their mandated areas, the UN agencies place a special emphasis on supporting the most vulnerable groups of the Uzbek population – children, women, the disabled, low-income families and the elderly - so that they have access to improved health care, education and jobs.

The publication "UN and Uzbekistan: partners in development" came out in Uzbek, Russian and English languages.

UZBEKISTAN TO HOLD MASS VACCINATION AGAINST MEASLES, RUBELLA IN NOVEMBER

Uzbekistan attaches great attention to strengthening the public health sector, improving the level of medical service and preventing various infectious diseases. With this aim, the country will hold a mass vaccination against measles and rubella in November. Currently, preparations for this event are under way in localities.

This was a topic of a scientific and practical seminar held in Samarqand at the initiative of the Health Ministry in partnership with UNICEF. Representatives from relevant departments, organizations and institutions, doctors and journalists attended the seminar.

It is planned to vaccinate all residents of Uzbekistan aged between 11 and 29 against the diseases.

Currently, vaccination offices are being set up, a list of citizens subject to the vaccination is being drawn up and they are being registered in localities.

A total of 1,862 vaccination offices have been set up in Samarqand. Vaccines that meet international standards will be delivered there. The most skilful and experienced doctors and specialists will be involved in this event.

The seminar focused on the importance of this work and on its practical aspects. The participants in the seminar received answers to all the questions they were interested in.

ALL THE BEST THINGS FOR CHILDREN

Another two socially important establishments having bright red pomegranate, symbol of the “Mehr Nuri” Fund, on their walls appeared in Tashkent. “Mehribonlik” Children’s Home ¹2 and Center for Treating Children’s Psycho neurological Diseases (former Children’s Psycho neurological Dispensary ¹5) were opened after major repair works.

Both buildings were completely reconstructed and supplied with new special equipment and furniture. Now the staff, small trainees and patients of the two establishments have favorable living and treating conditions.

At present the Center for Treating Children’s Psycho neurological Diseases treats around 100 children. “Mehribonlik” ¹2 is a native home for 400 children.

It should be noted that the “Mehr Nuri” Fund implements such social projects not only in Tashkent but also in other cities of Uzbekistan. This year it has realized around 10 projects on reconstructing the social institutions under the State Program on “Year of Social Protection”. The fund carries out charity activities in supporting families having many children, sponsoring children and healthcare establishments, offering grants for the development of family business and implementing projects on integrating the gifted youth’s professional skills into the process of Uzbekistan’s socio-economic development.