Tashkent, Uzbekistan (UzDaily.com) — On 23 September, a video conference chaired by President Shavkat Mirziyoyev focused on measures for further development of the construction industry and building materials production.

Before addressing the main agenda, the President highlighted issues related to poverty reduction and improving the well-being of the population. Following two key documents signed by the President, this year will see the launch of the "From Poverty to Prosperity" program, aimed at lifting 500,000 people out of poverty this year and an additional 1 million next year.

It was emphasized that the successful implementation of this program requires a radical transformation of the Ministry of Employment, elevating its role significantly. Consequently, Botir Zokhidov has been appointed as the Minister of Employment and Poverty Reduction.

The President noted that the ministry’s activities must change fundamentally. The Agency for Local Self-Governance will be dissolved, with its functions transferred to the Ministry of Employment and Poverty Reduction and the assistants to the khokim (local governors).

The President stressed the need to fully leverage the opportunities presented by external labor migration. The Agency for External Labor Migration will now report to the Government, with Bekhzod Musaev appointed as its head. The agency has been tasked with intensifying efforts to help citizens access high-paying foreign labor markets. Khokims and diplomatic representatives abroad will equally share responsibility for the well-being of compatriots working abroad.

Additionally, measures were discussed to allocate 50,000 hectares of land for poor families for agriculture and gardening. The Ministry of Agriculture and local khokimiyats have been instructed to identify an additional 50,000 hectares to boost the incomes of 200,000 families and help lift them out of poverty.

The need to spread the experience of creating industrialized "in-vitro" gardens across all regions of the republic, including Sokh, Bakhmal, Pop, and Ohangaron, was highlighted. "Mortgage gardens" will be established, allowing for leasing with the option to pay over five years after harvest.

This system will provide land to entrepreneurs wishing to create gardens, offering preferential loans and ready-made projects. The goal for this year is to create 14,000 hectares of such gardens and vineyards, with 29,000 hectares planned for the following year.

The meeting emphasized that construction is a key sector that will drive development across all areas of the economy. For instance, Uzbekistan’s annual construction spending amounts to 150 trillion sums, with one-third allocated to building materials.

The remaining expenditures support the electrical engineering, machinery, textile, chemical, and metallurgy industries, as well as construction equipment, design, and engineering services. In simple terms, construction is a sector that generates demand for both low-skilled workers and highly paid creative professionals, such as designers, architects, and technologists.

Over the past seven years, construction work worth nearly US$100 billion has been completed in Uzbekistan, reflecting significant accumulated experience. However, challenges such as climate change, resource shortages, and demographic and ecological issues require new approaches and solutions in the construction industry.

Modern projects must address not only building construction but also parking, green spaces, kindergartens, and sports and service facilities. The President noted that much work remains to be done in this area, with ongoing concerns regarding price, quality, and construction culture.

Prior to the meeting, the opinions of around 400 producers, builders, and design organizations were surveyed, revealing dissatisfaction with bureaucracy, excessive costs in the industry, and concerns over pricing and quality. If suitable conditions are created for entrepreneurs, they will be motivated to engage transparently in their operations.

Since the introduction of entrepreneur ratings, 11,000 builders and manufacturers have advanced from low to mid and high positions. This shift has led to 90,000 jobs emerging from the shadow economy, with average salaries increasing by 1.4 times. However, a significant portion of the "hidden economy" persists in the sector.

Over the past seven years, US$9 billion has been invested in the construction materials sector, resulting in the establishment of around 5,000 new enterprises and the creation of 94,000 permanent jobs. Production has doubled, with over 150 enterprises achieving annual revenues exceeding 100 billion sums. Construction volumes have also doubled in the last five years.

Thanks to the introduction of new products worth US$650 million, the share of imports in construction has decreased from 31% to 25%. The number of export markets for construction materials has expanded to 58, with over 20 trade warehouses and 50 stores opened abroad. Nonetheless, these figures are deemed insufficient for an industry with high potential and demand for products.

Notably, neighboring countries still import construction materials worth US$2 billion that are already produced domestically. Items such as paints, wallpapers, PVC pipes and fittings, flooring, cladding stones, and sanitary ware continue to be imported.

The use of basalt raw materials in construction has significantly reduced energy consumption in new residential and social facilities by up to 20%. Furthermore, utilizing reflective glass, fiber-reinforced panels, and vermiculite mixtures in construction could halve energy consumption.

Currently, the production of specialty glasses coated with indium, aluminum, or zinc films that reflect sunlight is not established. In this regard, the "Quartz" plant in Kuvasay has proposed a project to produce 5 million square meters of such glass annually, with an investment of US$20 million. The President approved this initiative and instructed the responsible parties accordingly.

Additionally, the use of fiber-reinforced panels on building facades can further reduce energy consumption by 10%. Importantly, these panels are 20% cheaper than other fire-resistant facade coatings, with sufficient supplies of cement and enriched sand available domestically.

Officials have been tasked with increasing projects aimed at producing energy-efficient modern building materials. Under the "industrial mortgage" program, seven projects worth US$170 million will be launched to produce new products such as autoclaved aerated concrete, fiber-cement panels, geotextiles, and basalt.

Despite a 1.2-fold increase in the production of building materials over the past two years, energy consumption has decreased by 1.3 times, and energy intensity has reduced by 1.6 times. Advanced foreign enterprises are actively employing technologies to generate electricity by reusing previously expended thermal energy.

For instance, "Kyzylkumcement" in Navoi has modernized its kilns and heat exchange equipment, saving 37 million kilowatt-hours of electricity annually. Officials have been instructed to complete energy audits at 34 high-energy-consuming enterprises by November 1 and ensure an annual savings of 300 million kilowatt-hours.

There is also a need to establish a laboratory modeled after South Korea’s at the Association of Building Materials. This facility will test energy-efficient, high-quality thermal insulation materials, sanitary ware, paints, ceramics, PVC products, and raw material quality.

To restore ecological balance, a moratorium on riverbed mining has been introduced, with instructions to create an alternative raw material base. Across the republic, 135 sand and gravel sites have been identified, with 40 already auctioned. Authorities have been tasked with resolving issues related to auctioning the remaining 95 sites.

By the end of the year, a processing site for accumulated tailings will be established at the Almalyk plant, enabling the annual supply of an additional 3 million cubic meters of sand and gravel.

The President noted an increase in illegal or inefficient exploitation of non-metallic mineral deposits, with 6 million cubic meters of illegal extractions reported last year, leading to an additional tax collection of 17 billion sums. Due to a shortage of surveyors, monitoring currently covers only 36% of mineral users.

To enhance oversight, 3% of revenue from non-metallic mineral deposits will be allocated to the Tax Committee’s fund. The committee is tasked with hiring at least two surveyors in each region and installing modern surveillance systems and measuring devices for effective control.

The President then engaged in discussions with entrepreneurs in the building materials sector, instructing responsible parties to carefully examine their proposals and initiatives and provide relevant recommendations.

During the meeting, the second agenda item focused on analyzing the state of the construction industry. It was noted that while the global construction sector is rapidly evolving with modern project solutions and technologies, Uzbekistan continues to rely on outdated norms, standards, and approaches despite an annual growth rate of 7-8% in construction volumes over recent years.

The implementation of high technologies, scientific advancements, and innovations in the sector has not kept pace with contemporary demands. Specifically, 38 urban planning norms and regulations (GNPs) remain unregistered, and 13 have not been updated. This has forced builders to expend additional time and resources obtaining special technical conditions for modern project designs, adversely affecting project costs.

To address these challenges, the Ministry of Construction and the Ministry of Justice have been instructed to register the 38 GNPs within one month and implement them in practice. Furthermore, by March 1, they are to develop national standards for buildings over 16 stories, shopping complexes, and parking facilities, along with an additional 13 GNPs.

A separate design bureau for buildings exceeding 16 stories will be established at the Tashkent Architectural and Construction University by the end of the year. Last year, regional governors were allowed to engage the private sector in developing master plans aimed at identifying small areas for housing, tourism, trade, and service development. Currently, master plans are in development for 85 territories in the Bukhara and Navoi regions; however, other regions have yet to commence similar efforts.

Regional governors have been tasked with creating master plans for at least 10 areas by the end of the year, with a total of 136 master plans required for 106 districts and cities. To date, only 21 plans have been completed, and no master plans have been prepared in the Andijan and Khorezm regions. Authorities have been instructed to promptly address these delays.

Concerns were raised over the initiation of 1,600 construction projects last year without proper registration, which has increased to 2,200 since the beginning of this year. Construction projects, depending on their category, should be inspected at least 2-4 times a month; however, inspectors have visited only 1,150 projects once over the past eight months. This has resulted in a rise in low-quality and chaotic construction, leading to public dissatisfaction.

The Ministry of Construction, the State Construction Inspection, and the General Prosecutor’s Office have been charged with intensifying the fight against bureaucratic hurdles and corruption in the construction sector. A construction operator task force will be established in regional inspection offices, equipped with body cameras. At each construction site, at least two cameras will be installed at the government’s expense, providing real-time data to the operator task force.

Control over illegal construction will be enhanced with the involvement of local community leaders and the public. Each construction site will now display a passport with a QR code, allowing anyone to access information about the project, including its status, permit details, and developer information. Lack of a QR code passport will render the construction illegal.

Additionally, the “resource-based” method is still used for designing and constructing state facilities. A transition to a “volume-based” method is planned for January 1 of next year, but the procedural framework for this system has yet to be finalized. The Cabinet of Ministers has been instructed to expedite this process. Responsible agencies are also tasked with organizing training courses to educate designers, contractors, and inspectors on the new system, ensuring that over 1,300 projects included in next year’s investment program are executed using the “volume-based” approach.

The President expressed concerns regarding the performance of Urban Planning Councils in each region, noting that project reviews and approvals can take up to six months. Projects must be approved by local health and fire safety departments before being submitted to the Urban Planning Council, despite their leaders already being part of the council.

If a project is rejected by the council, its resubmission requires re-approval from the Sanitary and Epidemiological Surveillance and the Fire Service, effectively doubling the costs for builders and designers and extending the process by an additional two to three months.

Now, all processes related to the activities of Urban Planning Councils will be fully digitized. All projects will be submitted for review through the electronic platform "Transparent Construction." Approval from the Sanitary and Epidemiological Surveillance and the Fire Service will be eliminated. Council members will coordinate projects through this platform, and the review period should not exceed 15 days. This procedure will be implemented in Tashkent starting December 1, and in other regions by April 1 of the following year.

It was also noted that the number of disputes between builders promising housing and individuals who invested money in these constructions has increased. As a result of dishonest developers, people are left without both their money and their homes.

Based on the President’s directive, a working group led by the Minister of Construction studied international practices, and now a system of guaranteed escrow accounts will be introduced for purchasing housing. Developers will enter into agreements with banks to facilitate the sale of under-construction homes. Individuals wishing to buy housing will deposit their money directly into the bank, rather than giving it to the builders. The banks will then transfer the collected funds to the developers as a resource. Thus, banks will act as intermediaries between builders and buyers, ensuring timely and quality construction and delivery of homes to owners.

This new system will be implemented within a year in Samarkand, as well as in the Yangihayat and Sergeli districts.

Currently, approximately 300,000 people are employed in construction companies. Consequently, enhancing their qualifications is a pressing task. It was noted that a system for assessing the qualifications of workers in this field needs to be established.

Specific requirements will be set for the qualifications of skilled professions and job positions. Workers who have trained independently or as apprentices will be able to take an exam to obtain a qualification certificate. Contractors will receive an additional 15 points in the rating system based on the number of certified workers they employ.