Tashkent, Uzbekistan (UzDaily.com) -- According to the Agency of Statistics, Uzbekistan’s GDP growth in the first quarter of 2023 amounted to 5.5%. This corresponds to the CERR forecast corridor of 5.31% -5.62%, although slightly higher than the 5.47% expected by experts. Experts point to a range of government measures that have helped mitigate the weather crisis and keep the economy from faltering.

Expectations for the economy of Uzbekistan raised the World Bank to 5.3%, the IMF to 5.2%. CERR in the first half of the year predicts more confident economic growth to 5.65%.

According to the report of the Agency for Statistics, in the first quarter of 2023, the growth of the gross domestic product (GDP) of Uzbekistan amounted to 5.5%. Growth in industry was 4.1%, in agriculture - 3.2%, in retail trade - 5.2%, in construction - 4.5%. Inflation for the first quarter was 2.4%, down from 2.9% last year. Foreign trade turnover increased by 11.9%.

The acceleration of economic growth is also associated with the timely adoption of urgent measures to support entrepreneurs affected by abnormal cold weather in Uzbekistan. In particular, loan repayments were extended for small and medium-sized businesses; provided an opportunity to repay the debt in installments without interest, without additional collateral, without "penalty"; allocated loans to restore production; suspended until April 1 this year. accrual of fines and penalties, etc.

Forecasts for the development of the economy of Uzbekistan

According to the April report, the International Monetary Fund (IMF) has improved the forecast for the growth of the economy of Uzbekistan. In 2023, Uzbekistan’s GDP growth is expected to be 5.3%, while in the October forecast this figure was at the level of 4.7%. IMF experts expect that in 2024 the economy of Uzbekistan will grow by 0.2%, up to 5.5%, which is 0.6 p.p. above previous IMF expectations.

The World Bank (WB) has raised estimates of Uzbekistan’s GDP growth for this and next years. According to the updated in April of this year. According to the forecast, the economic growth of Uzbekistan in 2023 will be 5.1%. It is noteworthy that this indicator improved by 0.2 p.p. compared to the autumn forecast for 2022 (4.9%). At the same time, household consumption will grow by 5%, capital investments by 4.2%, exports by 20.5% and imports by 20.6%.

CERR forecast

According to the Center for Economic Research and Reforms (CERR), in the first half of 2023, more confident economic growth is forecast than in the January forecast. If in the previous CERR forecast an increase of 5.47% was expected in the first quarter in 2023, then the forecast for the first half of the year has been improved to 5.65%.

At the beginning of 2023, a short-term decline was observed in the economy of Uzbekistan, which was due to seasonal factors noted in the previous CERR forecast, as well as the circumstances of the beginning of the current year - abnormal cold weather that provoked an energy shortage crisis, and external shocks that caused supply disruptions.

However, the rapid adoption of economic policy measures and the comprehensive measures taken by the government to stimulate enterprises have improved the development prospects.

The economy of Uzbekistan began to recover after overcoming the weather crisis and weekly GDP indicators entered the growth trajectory, which is also confirmed by the CERR indicators. Thus, a moderate increase in the business activity index was noted due to the growth of exchange components, an increase in indicators of the business climate and business activity in the regions, an increase in activity in domestic trade and the service sector.

The analysis of requests in the following categories showed a noticeable increase, "business and industry" grew by 5.8%, "purchases" - by 8.0%, "vehicles" grew by 4.1%.

Taking into account these factors and consolidating the weekly forecast indicators of GDP growth, the economy of Uzbekistan in the first quarter of this year. entered a trajectory of steady growth.

It should be noted that the CERR forecast for the 1st quarter of 2023 showed high accuracy, with a deviation of the expected GDP growth by only 0.03 p.p. compared with the actual data of the Agency on Statistics of the Republic of Uzbekistan. Thus, according to the results of the first quarter of 2023, economic growth amounted to 5.5%, while at the beginning of the year the CERR predicted growth at the level of 5.47%.

This year, the economy of Uzbekistan will continue to develop, maintaining the growth rates that were observed in the previous quarter.

The decision by the Central Bank to reduce the main rate from 15% to 14% in March will have a positive impact on the economy of Uzbekistan in the first half of 2023, both at the sectoral and macro levels, by stimulating domestic demand in the economy.

Taking into account the above factors, the expected growth of the economy of Uzbekistan in the first half of 2023 will be 5.65%. At the same time, the forecast corridor of economic growth is set at the level of 5.50% -5.75%.

Forecasts based on the Nocasting model have been used by the CERR since 2021 and allow revealing special aspects of GDP that cannot be identified in quarterly indicators. The GDP forecast is calculated based on weekly Google search results for 20 categories, combined with individual product price estimates and the fundamental variables of gross imports and inventories.