Uzbekistan Essay ⋆ Business Essay Examples ⋆ EssayEmpire

This central Asian republic, which shares borders with Kazakhstan, Turkmenistan, Tajikistan, Kyrgyzstan, and Afghanistan, has a population of 27.3 million, and covers a land area of 172,742 square miles. A landlocked country, it is one of only two countries in the world that is entirely surrounded by other landlocked countries. In medieval times, Uzbekistan was a wealthy entrepôt with the cities of Tashkent and Samarkand, being astride the famed Silk Road on which goods were traded between Europe and China. This continued through the Mongol occupation of the region, but declined in the 17th century because by this time, much of the trade went by ship. During the early 19th century, Uzbekistan became a part of the Russian Empire and later became a constituent part of the Soviet Union. In 1991 Uzbekistan gained independence as a nation from the Soviet Union.

During the time that Uzbekistan was a part of the Soviet Union, the centrally planned economy resulted in the establishment of a large cotton industry, drawing much water from the Aral Sea, heavily depleting the water supplies from it. With Uzbekistan being desperately poor throughout this period, the Soviet Union spent considerable funds on infrastructure, which saw the improvement of healthcare, education, and transportation. Many of these business structures were run centrally from Moscow, and this saw the emergence of a Russian managerial class, albeit at the time in state-owned corporations. As a result, most of the businesses in the country are still Russian, even though ethnic Russians make up only 5.5 percent of the country’s population.

Postindependence

After independence, the Uzbekistan Economic Model was introduced from 1994, by which state control of many companies continues, with a reduction in imports and an attempt by the country to achieve self-sufficiency in energy. Many people were disappointed that there was no real attempt to introduce a large private sector, and Uzbekistan remains one of the least industrialized countries in central Asia. It was also no longer able to access as many of the raw materials from other parts of the former Soviet Union as had previously been the case.

The country is now the second-largest exporter of cotton and the sixth-largest producer. It is also relatively rich in natural resources with significant deposits of coal, oil, natural gas, and copper: roughly 2.5 million tons of coal and 65,000 tons of copper mined in 2005, and an average output of 126,000 barrels of crude oil each day in the year 2005. The country is also the seventh-largest producer of gold in the world, with some 99 tons being mined each year. Mining also results in some 80 tons of silver and 1,770 tons of uranium each year. However, in spite of this, much of the population in the country is desperately poor. Average monthly wages are as low as $50 and the average gross domestic product (GDP) of the country is $535 per year.

Agriculture continues to employ, officially, some 44 percent of the population, but it is believed that some 20 percent of the population are unemployed or underemployed (against the official rate of 0.7 percent). Some observers believe that only 28 percent of the population work in farming. As a result, the importance of the cotton crop means that at harvest time, teachers and students take part in the harvest. This, in turn, has led to some foreign companies, in opposition to the use of child labor, refusing to stock items made from Uzbek cotton. The per capita GDP is $2,283, the lowest of any of the former republics of the Soviet Union. Corruption in Uzbekistan is regarded as serious, with the country ranked 137 out of 159 countries in the Corruption Perception Index in 2005; it ranked 175 of 179 in 2007.

Bibliography:

Tom Fleming, Taxi to Tashkent: Two Years with the Peace Corps in Uzbekistan (iUniverse, Inc, 2007);
International Monetary Fund and Uzbekistan, Republic of Uzbekistan: Poverty Reduction Strategy Paper (International Monetary Fund, 2008);
Martin C. Spechler, The Political Economy of Reform in Central Asia: Uzbekistan Under Authoritarianism (Routledge, 2008);
Manuela Troschke and Andreas Zeitler, Privatization and Corporate Governance in Kazakhstan and Uzbekistan: Insights from a Corporate Survey in Food and Light Industries (Osteuropa-Institut, 2006).

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