Tashkent gazettes Uzbekistan Airways for privatisation

Uzbekistan Airways (HY, Tashkent Islam Karimov) is to be privatised, along with 620 state-owned companies and properties, as part of the Central Asian country’s transition to a market economy. The wholly-owned state airline, as well as Uzbekistan Airports and Railways, are listed amongst 32 of the largest state-owned enterprises to be fully, or partially privatised in terms of a presidential decree issued on October 27, 2020, by President Shavkat Mirziyoyev. The privatisation campaign, the country’s biggest yet, is part of the government’s broader economic reform programme launched in 2017. The Finance Ministry would develop a draft budget by February 1, 2021, and a three-year business plan by July 1, 2021. Relevant state agencies would consider issues affecting the competitive environment by December 1, 2020; and the Cabinet would approve roadmaps for the implementation of the transforms by January 1, 2021. Although the size of the stake to be offloaded has yet to be revealed, in May, the Uzbek government said it might allow a “prestigious foreign company” to manage Uzbekistan Airways. The Uzbekistan government’s reform agenda, supported by USD4.44 billion from the World Bank, currently focuses on a sustainable transformation to a market economy; reform of state institutions; and health and education sector development. In 2020, the World Bank also provided Uzbekistan with USD295 million in emergency financing to help mitigate the impact of COVID-19. While the pandemic tempered the country’s prospects for a quick recovery in 2021, Uzbekistan’s economic outlook nevertheless remained positive as Mirziyoyev’s reforms continued to shift the economy toward greater resource efficiency and private sector growth, the bank said in its analysis of the country. In terms of an agreement signed in January 2020, the World Bank was also advising the government on the modernisation of the country’s civil aviation sector, including the preparation of a national aviation policy and development strategies for various segments of the aviation sector, in close cooperation with the Ministry of Transport, Civil Aviation Agency of Uzbekistan, Uzbekistan Airways, and Uzbekistan Airports. A key reform advised by the bank includes the unbundling of Uzbekistan Airways and the restructuring of the company’s core airline business. It also advised the government to establish an independent aviation policy-making body that would be separate from the safety regulator and to liberalise the country’s air-service agreements. According to the decree, other large state companies to be privatised will include energy firm Uzbekneftegaz; gold and uranium miner Navoi Mining and Metallurgy Combinat; and the carmaker Uzavtosanoat.