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Home : Projects : Expressway Financing in the Western Provinces of the PRC


Uzbekistan, Rep. of LOAN: UZB 31575-01
Small and Medium-Sized Enterprise (SME) Development
• Missions
• Loan Approval Date
• Estimated Completion Date
• Cost and Financing Plan
• Description
• Development Objectives
• Thematic Classification
• Poverty Classification
• Rationale
• Objectives and Scope
• Policy Dialogue
• Environment Category
• Env't Impact and Mitigation
• Social Aspects and Remedies
• Benefits and Beneficiaries
• Public Consultation
• Beneficiary Participation in Formulation
• Beneficiary Participation in Implementation
• Consulting Services
• Procurement
• Contacts
• Remarks
Location
Nationwide.
Sector
Industry & Trade /Small & Medium Scale Enterprises
Initial Listing
22 August 2000
Most Recent Update
19 December 2006
Executing Agency(ies)
  • National Bank of Uzbekistan for Foreign Economic Activity
  • Asaka Bank
  • Pakhta Bank
    • Missions

    TA Fact-Finding Loan Fact-Finding Pre-Appraisal Appraisal

    		1-14 Apr 2000
    		5-20 Jul 2000
    Loan Approval Date
    11 December 2000
    		Estimated Completion Date
    April 2006
    Cost and Financing Plan (in US$ million)

    Source Foreign Cost Local Cost Total
    Bank 50.00 0.00 50.00
    Cofinancing 0.00 0.00 0.00
    Borrower 0.00 0.00 0.00
    Beneficiaries 0.00 30.00 30.00
    Others 0.00 0.00 0.00
    Project/Program Cost 50.00 30.00 80.00

      OCR ADF Total
    Loan Amount 50.00 0.00 50.00

    Description
    The Project will support small and medium enterprises (SMEs) in Uzbekistan's private sector SMEs to foster economic growth, generate employment, help alleviate poverty and improve the balance of payments. Significant value addition will be generated through backward linkages with the primary sectors and forward ones with the tertiary sectors. The Project will simultaneously seek improvements in industrial policy and regulatory framework and in the financial intermediation of the banking system. The Asian Development Bank (ADB) will provide a credit line of $50 million to finance the foreign exchange component of several investment subprojects in the SME sector.
    Strategic Development Objectives
    Primary
    Economic Growth
    Secondary
    Rationale
    The potential for SME development is considerable in Uzbekistan, in view of its large natural resources, non-extreme climate which favors cultivation/rearing of agricultural inputs for SMEs, skilled and educated workforce, favorable geographic location (common borders with other Central Asian Republics and satisfactory transport infrastructure links with neighboring countries and Russia. These factors provide Uzbekistan a comparative advantage in SME development, and should facilitate its becoming as a prime production location for SME production to serve the domestic market and for exports. However, despite the high potential, Uzbekistan's development of SMEs has languished due to (i) internal constraints within SMEs relating to management information, technology, and processing skills; (ii) overall policy, legal, and regulatory constraints; and (iii) lack of credit and particularly foreign exchange funds for imports of capital goods, materials, and technology by SMEs. The Government has been receiving assistance from aid agencies to address SMEs' internal and credit constraints. The proposed loan will help finance the critical foreign exchange needs of viable SMEs. It will simultaneously open up opportunities for policy dialogue with the Government to improve the overall legal, regulatory, policy, and industrial framework in Uzbekistan to make more conducive to SME development. The loan, which will be channeled through three participating banks (PBs), will also help improve the efficiency of financial intermediation by the country's commercial banks.

    Objectives and Scope
    The Project's principal goal is to promote balanced and sustainable economic growth and thereby reduce poverty. In pursuit of this goal, the Project is expected to: (i) revitalize, diversify, and enhance the competitiveness of, Uzbekistan's private sector SMEs; (ii) improve the policy, legal, and regulatory framework for SMEs; (iii) create increased value addition through backward and forward linkages with primary and tertiary sectors, respectively; (iv) generate and sustain additional employment opportunities; (v) increase foreign exchange earnings through export promotion and savings through import substitution; and (vi) help improve financial intermediation of the banking system.

    Policy Dialogue
    Measures to address impediments directly related to SMEs, such as reduction in bureaucratic interference in the working of SMEs, simplification of tax assessment procedures ending bank's dual role as tax assessor and collection agent.

    Environment Category: B

    Environment Impact and Mitigation

    Social Aspects and Remedies
    The Project will provide direct and indirect employment particularly to women by generating new jobs through forward and backward linkages, and direct hiring of labor in subprojects. Adequate social security benefits covering health and social protection will be provided to workers.

    Benefits and Beneficiaries
    Creation of an estimated 3,150 new direct jobs in 70 new subprojects. Generation of incremental exports worth US$93.9 million. Additional indirect employment benefits to approximately 3,000 - 5,000 persons through backward and forward linkages.

    Public Consultation
    1. Arranged by Borrower
    2. Date for Consultation : Consultations were made during project appraisal in July 2000.
    3. Groups Consulted : Aside from major stakeholders in the Government and banking association in Uzbekistan, field visits were made by appraisal mission to project proponents in various project areas (e.g. Samarkand and Tashkent).

    Beneficiary Participation in Formulation
    The three participating banks (NBU, Asaka and Pakhta) joined the discussions during project preparation. Subproject proponents were consulted.

    Beneficiary Participation in Implementation

    Consulting Services
    Not required.

    Procurement
    ADB's Guidelines for Procurement applicable to Development Finance Institutions will be followed. Subborrowers will be required to procure goods from ADB member countries on an international competitive bidding/international shopping basis. A pre-shipment inspection certificate will be required from exporting country for goods to be financed by ADB loan costing over US$1.0 million. Procurement will be conducted transparently and in conformity with ADB's anti-corruption policy.

    Contacts
    Bank
    R. Narasimham
    Senior Project Management Specialist
    CWGF
    Tel. No.: (632) 632-6703
    E-mail: rnarasimham@adb.org

    Executing Agency
    National Bank of Uzbekistan for Foreign Economic Activity
    Contact Person : Javdat Unusov, Head of PIU for ADB
    Tel. No. :
    Fax. No. : (998712) 340453
    E-mail :
    Contact Person :
    Tel. No. :
    Fax. No. :
    E-mail :
    Asaka Bank
    Contact Person : Rashid A. Adilov, Chairman
    Tel. No. :
    Fax. No. : (371) 120 83 96
    E-mail :
    Contact Person :
    Tel. No. :
    Fax. No. :
    E-mail :
    Pakhta Bank
    Contact Person : Farhod U. Azizov, Head of Project Financing Dept.
    Tel. No. :
    Fax. No. : +998 (71) 173-25-10
    E-mail :
    Contact Person :
    Tel. No. :
    Fax. No. :
    E-mail :
    Remarks

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