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Finance 30/09/2011 Reforming of financial architecture discussed in Uzbekistan
Reforming of financial architecture discussed in Uzbekistan
Tashkent, Uzbekistan (UzDaily.com) -- Center for Economic Researches hosted a roundtable for mass media representatives to discuss main results and conclusions of research project “Reforms of international financial architecture: challenges and opportunities of Uzbekistan” on 30 September.

Post-crisis development characterizes with several trends: a) speeding up of movement of the center of post-crisis development to developing world; b) speeding up of position of developing countries as center of global consumer demand; c) growing of share of developing countries in control over international financial architecture, especially in part of gold-currency reserves; d) movement of investment and innovative potential.

In the result of impact of above-mentioned trends, main characteristics of post-crisis global development became strengthening of “instability arc”, which characterized with such processes as deepening global macroeconomic imbalance, growth of risks of instability of traditional growth factors, strengthening social instability and depreciation of the US dollar as global reserve currency.

Main conclusions, which outcome from developing markets, are: a) strengthening competition in all directions; b) strengthening role of goods exports inflow; c) growth of new tools for accumulation and use of cyclical income.

Growth of “instability arc” at global goods and financial markets can decrease sustainability of sources of financing economic growth of Uzbekistan, which requires searching additional financial sources for growth and transforming existing model of financial inflows. Current model of financial inflow was developed in the second part of 1990s, during “preliminary capital accumulation”. In the model, the government acts main source of demand in economy. Peculiarity of the model is that private sector and market financial mediatory are secondary.

Search of additional financial resources of growth envisages necessity to transform current growth model, based on economic demand, formed by the government, and growth model, based on economy of offer. The model stipulates creation of private source of growth – private firms and households. They should replace and gradually force out the government from entrepreneurial zone. The government should create maximum favourable conditions for functioning of private economy agents, stimulating their interest to development, thus, to stimulate goods and service offers.

Meaning of the model should become diversification of sources, forms, currency and methods of attracting and using investments. They are: a) strengthening financial accompaniment of export inflow; b) diversification of management strategy of external borrowing; c) boosting internal financial opportunities.

Successful implementation of these directions envisages boosting some macroeconomic components. In particular, it is necessary favourable currency policy (unification of exchange rates). Besides, it is necessary to move to targeted inflation, which will allow to hold interest rate at acceptable level for investors. Reforms in legislation sector, directed at protecting ownership rights and development of competition, as well as abolishing corruption should be also strengthened.

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