Uzbekistan : Integrated Urban Development Project

Water and other urban infrastructure and services / Other urban services - Urban policy, institutional and capacity development - Urban sanitation - Urban sewerage - Urban solid waste management - Urban water supply

Sector context and trends. Since Uzbekistan became independent in 1991, urbanization has lagged, leading to significant regional imbalances. More than half of the urban population is concentrated in its easternmost regions--around the capital city of Tashkent and in the Fergana Valley, an industrial center. Although a considerable share of the urban population lives in the largest cities, the fastest population increases have been in medium-sized cities with untapped potential for generating jobs. The lifting of internal mobility restrictions in 2020 and a significant youth bulge will continue to put pressure on the internal labor market and drive migration. To absorb this growth and provide livability, secondary cities must confront challenges of urban sprawl, polluted environments, degraded infrastructure, water insecurity, and the lingering economic impact of COVID-19, particularly on the poor and women. The project will demonstrate how urban planning concepts--embodying smart, green, resilient, inclusive urbanism--and integrated solutions can improve livability and economic competitiveness in secondary cities.

Government strategy. In 2019, the government issued Presidential Decree No. 5623 to support the integrated development of cities. In 2020, the government established the Department of Urbanization Policy Development under the Ministry of Economic Development and Poverty Reduction to oversee its urban agenda. Reforms in the last three years include a new urban planning code requiring citizen participation, fiscal decentralization, and new agencies for public-private partnership, water supply, solid waste management (SWM), and cadaster. However, weak institutional capacity and coordination for strategic urban development remains a significant challenge for cities. To enhance coordination, the government appointed the Ministry of Investments and Foreign Trade (MIFT) as the focal agency to work with development partners in formulating integrated urban development projects that demonstrate international practices in sustainable urbanization for further replication.

Key issues in project cities. The three project regions of Djizzak, Sirdaryo, and Khorezm have historically ranked at the bottom nationally in terms of quality of life, economic competitiveness, and infrastructure development. Key issues facing the project cities include (i) an economic slowdown because of COVID-19 combined with a lack of economic diversity, unskilled workforce, and high unemployment, especially among women and youth; (ii) underinvestment in aging infrastructure leading to poor quality of water supply and sanitation (WSS) services with a lack of universal coverage and limited operation and maintenance (O&M); and (iii) a deficit of green, usable, and safe public spaces, especially for women and persons with disabilities. In Djizzak, high in-migration, inadequate basic services, and the poor quality of the urban environment contribute to low livability and imbalanced socioeconomic development. In Khiva, a 90% decrease in tourists because of COVID-19, a lack of visitor services, weak linkages with other "Silk Road" destinations, and disconnected tourism value chains prevent diversified, inclusive growth. In Havast, low-quality solid waste services, a lack of public spaces, and a young, unskilled workforce constrain competitiveness; and in Yangiyer, poor solid waste collection services inhibit livability.

Water supply services delivery in the project cities is constrained by intermittent supply (4-8 hours per day), low pressure, aging pipelines built 40-50 years ago, high nonrevenue water (NRW) estimated at 40%, and defective disinfection systems. These pose health risks, with a disproportionate impact on women and the poor. Sewerage and solid waste collection coverage are low in the four project cities. Sewerage coverage ranges from 13% to 37% while solid waste collection ranges from 41% to 91%, with no formalized recycling programs and limited public awareness in waste minimization. There is a need to upgrade Soviet-era infrastructure with modern solutions to improve efficiency, O&M, asset management, and to support water, sanitation, hygiene, and health (WASH+H) measures in communities to reduce the spread of infectious diseases such as COVID-19.

Institutional issues. A legacy of centralized governance left city hokimiyats (local governments) with technical, organizational, and financial capacity constraints, inhibiting their ability to effectively manage, plan, invest, and deliver services in an integrated manner. Utility operators operate with low efficiency, weak O&M, low revenues, outdated technology, poor financial and asset management, weak customer service, and limited knowledge of modern solutions and best practices. There is a need to professionalize their capacities in strategic planning and budgeting, operational efficiency, O&M, municipal finance, citizen participation (particularly women), high-level technology, and private sector cooperation, to ensure high-quality, responsive, and sustainable urban services delivery.

Climate change risks. Average temperatures are expected to increase by 2

C-3

C in the next 50 years in Uzbekistan. The project areas are vulnerable to more extreme and frequent heat waves particularly in the western provinces. Water scarcity is a significant risk linked to climate change that is expected to worsen and severely affect the country's urban water supplies. There is a need to improve the efficiency of water supply systems, expand water-saving technologies, and support green spaces to counteract the heat-island effect in urban areas.

Lessons. This is the first integrated urban development project of the Asian Development Bank (ADB) in Uzbekistan, as past projects focused separately on water supply, sanitation, or SWM. Key lessons from sector and country operations include (i) aligning with the government's reform agenda; (ii) supporting sustainability measures, including O&M and revenues; (iii) ensuring local participation; (iv) improving project readiness to avoid start-up delays; and (v) providing technical assistance (TA) for institutional support throughout the project period.

Development partner coordination. ADB is closely coordinating with other partners in the urban sector, including the World Bank, the Asian Infrastructure Investment Bank, the European Bank for Reconstruction and Development, and the Islamic Development Bank. The World Bank's ongoing Medium-Size Cities Integrated Urban Development Project supports strategic city investments and provides institutional support at the national level.

Strategic relevance. The project is aligned with (i) the national development strategy, 2022-2026; (ii) updated national climate change strategies; (ii) ADB's country partnership strategy for Uzbekistan, 2019-2023; (iii) the Central Asia Regional Economic Cooperation (CAREC) Tourism Strategy 2030; and (iv) the following operational priorities (OPs) of ADB's Strategy 2030: OP1--addressing remaining poverty and reducing inequalities; OP2--accelerating progress in gender equality; OP3--tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability; OP4--making cities more livable; OP6--strengthening governance and institutional capacity; and OP7--fostering regional cooperation and integration. The project is aligned with the overall goals of the Paris Agreement, through improved SWM to reduce greenhouse gas emissions, improved water management to enhance water security, and greening of urban areas to adapt to more intense heatwaves.

Sustainable urbanization and welfare of the urban population enhanced.

Access to inclusive, resilient, and sustainable urban services in secondary cities enhanced.

Inclusive municipal and tourist infrastructure and services provided.

Climate-resilient drinking water, sanitation, and solid waste services enhanced with smart systems.

Urban governance, institutional capacity, and livelihood support strengthened.