Uzbekistan: Financial Markets Development Program (Subprogram 1)
The program proposes to introduce reform measures that deepen and broaden Uzbekistan's financial markets by (i) developing the public debt management framework to promote a more liquid government bond market; (ii) enhancing institutional investor demand by broadening, deepening, and diversifying the investor base; (iii) supporting the money markets; (iv) developing critical market infrastructure including surveillance systems, consolidating trading systems, and enhancing post-trading systems; and (v) enhancing the supply of alternative financial instruments such as exchange-traded funds.
Shah, Syed Ali-Mumtaz H.
Central and West Asia Department
Request for information
7 October 2021
|Project Name||Financial Markets Development Program (Subprogram 1)|
|Project Type / Modality of Assistance||Loan
|Source of Funding / Amount||
|Strategic Agendas||Inclusive economic growth
|Drivers of Change||Gender Equity and Mainstreaming
Governance and capacity development
Private sector development
|Sector / Subsector||
Finance / Finance sector development
|Gender Equity and Mainstreaming||Some gender elements|
|Description||The program proposes to introduce reform measures that deepen and broaden Uzbekistan's financial markets by (i) developing the public debt management framework to promote a more liquid government bond market; (ii) enhancing institutional investor demand by broadening, deepening, and diversifying the investor base; (iii) supporting the money markets; (iv) developing critical market infrastructure including surveillance systems, consolidating trading systems, and enhancing post-trading systems; and (v) enhancing the supply of alternative financial instruments such as exchange-traded funds.|
|Project Rationale and Linkage to Country/Regional Strategy||
The Government of Uzbekistan has accelerated its transition toward a market economy with the adoption of the Strategy on Actions for Further Development of Uzbekistan (2017-2021) and follow-on Roadmap of Reforms (2019-2021). Both the strategy and the road map recognize the central role played by the banking sector and financial markets in fostering this transition. The Roadmap of Reforms tasks the government with modernizing and developing financial markets to better address the financing needs of the real economy, which is moving away from a state-led and state-dominated economy towards a market-oriented, private sector-led model. Underdeveloped financial markets have contributed to the ineffective mobilization of savings with gross domestic savings at 31% of gross domestic product (GDP), which is lower than regional peers such as Kazakhstan (42% of GDP). The introduction of market-based instruments, backed by a sound enabling environment for competitive financial markets, will mobilize private sector financing and help the private sector become the driver of sustainable economic growth.
The proposed program will support demand and supply measures to broaden and deepen the financial system in Uzbekistan to facilitate effective intermediation. It will support policy, regulatory, and institutional (including market infrastructure) reforms necessary to create an enabling environment for competitive financial markets in line with the government's Strategy on Actions for Further Development of Uzbekistan (2017-2021) and follow-on Roadmap of Reforms (2019-2021), Asian Development Bank (ADB) country partnership strategy (CPS) for Uzbekistan, 2019-2023, and the ADB country operations business plan for Uzbekistan, 2021-2023. The programmatic approach, comprising two subprograms, will help sequence reforms over a 4-year timeframe (2019-2023) and provide flexibility to incorporate changes if warranted. TA attached with the program's concept paper approval in 2019 supported reform measures from 2019 to 2021. With its emphasis on creating an enabling environment for financial market development, the program design is robust and fits well with the country's needs as a growing and economically diversifying economy. The attached TA will assist in implementing the program.
|Impact||Well-functioning financial system that supports basic capital and investment needs and the country's long-term economic objectives.|
|Description of Outcome||Greater capacity and size of the financial markets.|
|Progress Toward Outcome|
|Description of Project Outputs||
The legal and regulatory structures for the development of the securities market have improved.
The supply and demand of securities have increased.
|Status of Implementation Progress (Outputs, Activities, and Issues)|
|Summary of Environmental and Social Aspects|
|Stakeholder Communication, Participation, and Consultation|
|During Project Design|
|During Project Implementation|
|Consulting Services||ADB will engage a consulting firm to implement the TA. It is estimated that 15 person-months of international and 3 person-months of national consultants' services will be required. The proposing entities may propose some adjustments with justification. Given the highly specialized expertise needed, the consulting firm will be engaged through quality and cost-based selection method using a standard quality cost ratio of 90:10. ADB will select the consulting firm based on a simplified technical proposal. The team of consultants will have expertise in capital markets, insurance and pensions development and facilitation across diverse technical facets (including institutional, legal and regulatory, infrastructure).|
|Responsible ADB Officer||Shah, Syed Ali-Mumtaz H.|
|Responsible ADB Department||Central and West Asia Department|
|Responsible ADB Division||Public Management, Financial Sector and Trade Division, CWRD|
Ministry of Finance
5 Mustaqiliik Square
Republic of Uzbekistan
|Concept Clearance||16 Jul 2019|
|Fact Finding||13 Apr 2020 to 07 May 2020|
|MRM||09 Jul 2021|
|Approval||07 Oct 2021|
|Last Review Mission||-|
|Last PDS Update||07 Oct 2021|
|Approval||Signing Date||Effectivity Date||Closing|
|07 Oct 2021||-||-||31 Dec 2021||-||-|
|Financing Plan||Loan Utilization|
|Total (Amount in US$ million)||Date||ADB||Others||Net Percentage|
|Project Cost||100.00||Cumulative Contract Awards|
|ADB||100.00||20 Oct 2021||0.00||0.00||0%|
|Cofinancing||0.00||20 Oct 2021||0.00||0.00||0%|
|Financing Plan/TA Utilization||Cumulative Disbursements|
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
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|Title||Document Type||Document Date|
|Financial Markets Development Program (Subprogram 1): Technical Assistance Report||Technical Assistance Reports||Sep 2021|
|Financial Markets Development Program (Subprogram 1): Report and Recommendation of the President||Reports and Recommendations of the President||Sep 2021|
|Financial Markets Development Program (Subprogram 1): Concept Paper||Concept Papers||Jul 2019|
|Financial Markets Development Program (Subprogram 1): Initial Poverty and Social Analysis||Initial Poverty and Social Analysis||Jun 2019|
Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.
None currently available.
Evaluation Documents See also: Independent Evaluation
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$100 Million ADB Program to Help Develop Financial Markets in UzbekistanThe Asian Development Bank today approved a $100 million policy-based loan to support policy, regulatory, and institutional reforms needed to create an enabling environment for competitive financial markets in Uzbekistan.
|Tender Title||Type||Status||Posting Date||Deadline|
|Supporting the Financial Markets Development Program||Firm - Consulting||Active||12 Oct 2021||26 Oct 2021|
No contracts awarded for this project were found
None currently available.