TOPIC OF THE WEEK: Q&A on 2024 Uzbekistan macro
In 2024, Uzbekistan's economy continued to grow at a pace comparable to previous years. GDP grew by 6.6% over Jan-Sep. In 11 months, accumulated inflation has risen to 8.7%, which is higher than the same indicator in 2023. Annual (YoY) inflation has exceeded 10%. At the end of the year, the Central Bank expects inflation in the range of 9.5%.
Since the beginning of the year, the Uzbek sum has depreciated against the dollar by about 4%. In June-July, the national currency rose slightly in price, but since August it has gradually become cheaper. However, the rate of devaluation remains moderate, especially compared with how the currency has behaved in previous years.
Against the background of a record rise in the price of gold, Uzbekistan's international reserves exceeded the US$40bn mark for the first time in history. In November, reserves decreased for the first time since March, but at the same time, they remain close to record levels.
In a Q&A format, I discuss the main trends in the economy this year: the reasons for accelerating inflation and the strengthening Uzbek sum in real terms, the risks of microcredit growth, the evolution of the twin deficits, the issues related to gas imports, prospects for Uzbekistan's accession to the WTO and our forecasts for 2025.
My goal here is to focus less on the numbers, which were provided in plenty of detail in the 2025 CCA Outlook, but rather on the heuristic explanation of what has been going on in terms of the macro and micro in the country.
Now read on...
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