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Creation new jobs and employment maintenance is the most important priority of social-economic policy of Uzbekistan

우즈베키스탄 Behzod Tagaev Institute for Social Researches under the Cabinet Project manager 2010/02/23

Last years in Uzbekistan serious qualitative changes are taking place in solving of population’s employment problems. The model of transition to a socially-oriented free market economy, which we have adopted and is based on the five principles, justifies its accuracy and consistency. Such principles as deideologization, pragmatism of economic policy in the form of a priority of economy over politics, assigning the role to a state of a chief reformer, ensuring the rule of law, conducting a strong social policy and consistency in implementing reforms – all these, especially given the extreme conditions of the global financial and economic crisis, prove their urgency and viability.


The ongoing balanced and well though-out policy to reform, liberalize and modernize, firstly, the nation’s economy, diversify its structure has created a rather powerful barrier, it can be said, a solid and reliable buffer that protects us from negative impacts of crises and other threats. In 2010 the one of priority tasks remain to be the further accelerated development of services and small businesses as the most important factor of ensuring jobs and raising the people’s living standards.


The dynamic character of small business, its ability to relatively easily conform to changes in the market conditions and consumer demand makes it an indispensable instrument of creating the new jobs and increasing the incomes of population during the global economic crisis. The task of further supporting the small businesses which create the new jobs and shape the incomes of more than 70% of employed population is urgent as never before. Today about 50% of gross domestic product (GDP) are producing by small business against 30% in 2000.


Therefore, a special attention is paid in the Anti-crisis program of Uzbekistan (2009-2012) to giving incentives to the development of small business. These measures include the tax and credit benefits, as well as further deepening the institutional reforms to create more favorable business climate for developing small business and private entrepreneurship.


In 2009 the single tax payment rates for small industrial enterprises have been decreased from 8 to 7% and from 2010 for all small businesses, while the micro-firms and small businesses rendering financial, personal and other kinds of services are exempt from single tax payment for the period of three years. In this, the dividends gained by the founders of micro-firms and small businesses, as well as the non-state economic entities in terms of assets channeled to investments and payments for previously obtained credits are exempt from taxation for the period of five years. Also the rate of fixed tax for individual entrepreneurs reduced average to 1.3 times.


In 2009 the GDP grew and accounted for 8.1%, the growth rates in industry made up 9%, agriculture – 5,7%, retail commodity circulation – 16,6% and paid services rendered to population –12,9%.  The level of inflation consisted 7,4% and State budget has executed with surplus in rate 0,2% to GDP.


In 2009 the volume of investment to economy increased in equivalent up to 8,2 billion USD that against 2008 more than 24,8%. In 2009 the amount of salary in the budget sphere increased for 1,4 times and respectively – in the economic entities and in December 2009 averaged out 587 thousand Uzbek Sums  (about 400 USD).


In resolving this sharp issue alongside with accelerated development of small business and private entrepreneurship the big role is assigned to the development of sphere of services, broad introduction of various forms of home-stay labor, and stimulation of development of cattle-breeding in the countryside.


The development and expansion of sphere of services plays an important role in increasing the number of jobs. The communication, information, financial, banking and transport services and those on auto and household electronic goods repairing developed with highest rates. It is especially worth noting the dynamic development of services in the sphere of information and communication technologies, which for over the past four years have been increasing annually on average by 50%. As a result, the share of sphere of services in GDP grew in 2009 up to 47,0% against 42,5% in 2007. There is a goal to grow the share of sphere of services in GDP to 49,0% in 2010.


It is necessary to note that the final aim of the Government of Uzbekistan from realizing reforms in social-economical sphere including economy diversification, investment, export of goods, implementing new technology in different sectors of economy is create new jobs, employment maintenance and increase the living standards of population.


In 2009 about 940 thousand new jobs have been created, including in the sphere of small business – more than 392 thousand, the sphere of services – about 270 thousand, and to the practice of home-stay labor – 77 thousand. 


At the same time for the purpose of decreasing administrative barriers the Government of Uzbekistan reduces the number of state leading staff for 12% to 1st March 2010. Year by year the number of state employees is reducing and if 2008 21,3% worked in state sector this rate in 2009 was 20,9% and in non state sector 79,1%. Unemployment rate in country is remaining stability at 4-5%.


Today, the average age of the citizens of Uzbekistan is 24 years old. In 2009 average constant population amounted 27.8 million, 58% of them or 16.1 million are labor resources. Demographic situation also requires to special attention to creating more jobs. The rate of birth is become higher and average 23 per thousand and this circumstance exerts certain pressure upon labor market.


Every year number of labor resources of Uzbekistan is increasing to 3% or 450-500 thousands. In 2009 number of employment population is reached to 11.3 million people, increasing to 2.7%. In particular the rate increase was high in construction industry (6.8%), transportation and networking (5.4%), electricity, gas supply and other areas (5.8%), trade and food industry (4.4%), finance and banking sectors (4.3%) and light industry (2%).


The employment structure by spheres of economy in 2009 was: in industry 13,4%; construction 8,9%; agriculture and forestry 26,7%; transport and communication 5,1%; trade and public catering 10,5%; municipal, public services 3,4%; public health, physical education, sports, social ensuring 7,6%, education, culture, art, science and scientific service 13,9%; finances, crediting and insurance 0,6%; others 10%. Last years the quality changes are occurring in employment structure in light of diversification of economy. The numbers of engaged in agriculture are considerable decreasing and transferring to another branches of economy, in the first place to sphere of services and industry.


In order to realize all provided measures on creation new jobs and system control for their realization in all regions of the republic have been created workgroups at district, city and region level. All these measures have been developed with the participation of all ministries, agencies, economic organizations, enterprises which were affected in republican Program to 2010 on creation new jobs and employment maintenance in sector and regional section. This program also was approved by Parliament. Preliminarily all parameters of this Program deeply have been worked at regional level and were taken control of local municipalities.  


In 2010 the new jobs numbering 950 thousand will be created by implementing of this Program will cover the following areas such as development of the real sector, investments, localization, modernization, development of the areas and measures against crisis. In addition this project was created based on the real needs for new vacancies and jobs in Uzbekistan.


The needs for new jobs in labor market were developed proceeding from following factors: First, in 2009/2010 additional 510 thousand youth will join the labor force of Uzbekistan after graduation. Secondly, in near future years, numbers possible labor force will increase additionally to 330 thousand due to the demographic and economic changes in the country.


Local programs on creation new jobs are developing based on the specific conditions of the regions of country: a) supply and demand in local labor market for vacancies with forecast for the future years; b) economical potential of regions based on the factors as plants, factories and labor force; c) based on the educational institutions as Universities, colleges, their major specialization and others circumstances.


First, taking into account the investments, localization, and development of the real sector of economy the new 56 thousand jobs will be created. 25 thousand of new jobs will be created by opening new enterprises, and 31 thousand with implementation of the local projects in countryside.


In 2010 more than 400 new production factories and plants will be launched in country, 40 of them will be the largest. These are the main factors which will create additional jobs. Moreover, creation of 9 large production plants will increase the potential for employment for Navoiy region - free industrial economic zone.


Additionally it is planned to develop automobile roads and direct investments by Government amount 540.2 billion Uzbek sums for the project “Uzbek national roads”. There is a new project is developing to build a section of Uzbek national roads by means of Asian Development Bank which helps to transit goods between Europe and Asia and will generate the creation of new jobs in country.


Secondly, development of private entrepreneur, with creation of the micro firms and small businesses will create the additional 477 thousand new jobs. This project will cover the sphere of services. It will generate 282 thousand new work places in service industry, production industry 53 thousand, construction and building sectors 44 thousand.


Thirdly, development of private entrepreneurship will create 129 thousand new job places. These achievements will be accomplished due to the facts as creating good conditions for developing small business in Uzbekistan.       
   

Fourthly, production sector based home-stay labor, development of national craftsman production, keeping cattle at small holding and development family business will be created 208 thousand new jobs. A lot of unemployed people mainly women with children, disabled people and other people mostly dependant were employed in these new jobs.


Uzbekistan has created a well-tested mechanism of realizing cattle to population and farms at the auctions, allotting them privileged purposeful credits, expanding and raising the quality of veterinary services, as well as providing with fodder. As a part of implementation of the program adopted to develop cattle breeding alone, more than 25 thousand heads of cattle were realized at the auctions in 2009. A particular attention is being paid to rendering support to the less well-off families by way of allotting cows for free. From 2006 up to now alone over 130 thousand cattle were allotted to such families.


Fifthly, almost 128 thousand new jobs will be created in industries as cattle production, chicken production, fish production, honey production, fruit production and in other industries. Moreover, by launching the manufacturing plants it will be possible to create new jobs in country. For instance, it is planned launching 148 plants for production of meat, milk, fruit and vegetable production. 


Sixthly, by development of production sector and beginning of construction of the houses will be created additional 61 thousand new jobs. These targets will be achieved by developing the road construction, railways construction, gas and water supply systems.


Finally, pursuing effective economic policy, further liberalization of economy including development of infrastructure is a vast labor investment sphere that allows creating the new jobs and ensuring the employment of population, especially the youth, as well as raising the incomes and well being of the people.

  

 

 

 

 

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