Select Committee on Foreign Affairs Minutes of Evidence



ANNEX A8

UZBEKISTAN

BASIC FACTS

  1. Uzbekistan is the second largest state in Central Asia and the most populous (22.5 million—71 per cent Uzbek, 8 per cent Russian, 5 per cent Tajik, 4 per cent Kazakh, 3 per cent Tatars). Much of the west and north of the country is desert or semi-desert: the population is concentrated in Tashkent and the fertile Fergana valley. It borders Kazakhstan, Turkmenistan, Kyrgyzstan, Tajikistan and Afghanistan. All of Uzbekistan's neighbours have significant ethnic Uzbek minorities.

INTERNAL POLITICAL

  2. Former First Secretary of the Communist Party Islam Karimov was elected President in 1991 with 86 per cent of the vote. In 1995 a referendum on the extension of Karimov's term of office (due to expire 1997) until the year 2000 yielded a 99 per cent "yes" vote. International observers were not invited to the referendum. Parliament, which sits for about 12 days a year, subsequently decided that the referendum should count as an extension of the President's first term of office, so he could remain in power until 2005. Parliamentary (and possibly Presidential) elections take place at the end of this year.

  3. Placing stability above all else, and fearing an Islamic revival, Karimov has limited real democratic development. Genuine opposition parties are not tolerated. The main opposition movements are not allowed to register or have been banned. On 16 February 1999 a series of bombs exploded in Tashkent, killing 13 people and wounding some 128 others. Although the government has blamed Muslim extremists and has arrested people they claim were trained in neighbouring countries, they have yet to produce firm evidence that Islamists were responsible.

ECONOMY

  4. Uzbekistan has substantial natural resources, including gas, oil, gold and silver. Agriculture is also important: Uzbekistan is the world's third largest exporter of cotton. The collapse of gold and cotton prices have badly affected the economy. President Karimov has opted for a cautious, gradualist approach to economic reform. The IMF originally provided support but this was suspended in December 1995 when the Uzbek government decided to follow an import substitution strategy in response to a rising trade deficit, fixing an artificially strong exchange rate and introducing strict currency conversion controls. The authorities grant licences for access to hard currency allowing favoured companies to obtain dollars at a preferential rate. Others must use the lower commercial rate. Until restrictions on currency convertibility are removed and there is more clarity on legal issues and efficiency in the banking sector, foreign investors will face a difficult environment in Uzbekistan. But some major investments have been made, including a Korean car plant at Andizhan in the Fergana valley. (Significant UK investments are covered below). The Uzbek Government is aiming to liberalise exchange rates in 2000. There are few reliable statistics on the Uzbek economy. Official figures show inflation peaking at over 1,500 per cent in 1994 and falling to 58.8 per cent in 1997. GDP grew 5.3 per cent in 1997 and GDP per capita was $532.

HUMAN RIGHTS

  5. The human rights record of Uzbekistan is poor. Civil and political rights are severely curtailed; no genuine political opposition exists; the media are censored; unofficial religious groups are harassed; and the unreformed judicial system offers little protection. Recently concerns have focussed on the government's campaign against what they call "Wahhabi" Muslims in the Fergana Valley following the murder of several local officials in December 1997. The Uzbek authorities blamed the murders on Islamic fundamentalists and made numerous arrests. Others suggest the murders were related to ordinary crime. A restrictive law on religion has been introduced; there have been several "show trails", at the end of which long sentences have been handed down; there are frequent allegations of fabrication of evidence; and "disappearances" of alleged Islamic activists have been reported. We frequently raise human rights concerns with the Uzbek authorities, both bilaterally and in concert with our EU partners.

BILATERAL RELATIONS

  6. The British Embassy in Tashkent opened in May 1993. HRH The Prince of Wales visited Uzbekistan from 9-12 November 1996 but the last FCO Minister to visit was Malcolm Rifkind, as Foreign Secretary, in February 1997. President Karimov visited the UK in November 1993. Foreign Minister Komilov has paid three official visits to the UK in 1995, 1996 and January 1999. Prime Minister Sultanov visited in November 1997. The first Uzbek Ambassador to the UK arrived in July 1997.

  7. The British Council has a full Directorate in Tashkent, responsible also for Tajikistan and Turkmenistan. The MoD maintains a small programme of defence co-operation including English language training. The current KHF allocation is £700,000, focussed on health and agriculture, the provision of economic advice and civil society/democracy.

  8. UK exports in 1998 were £35.7 million, down from £91 million in 1997 (the latter distorted by civil aircraft sales). Imports were £7.4 million, down from £17.4 million. Despite the convertibility problem a number of major British companies are active in Uzbekistan, including British Aerospace, BAT (who have opened a factory), Laing, Crosrol and Smith Kline Beecham. ECGD cover is under review in the light of the Russia crisis. Between mid-1997 and mid-1999 there will have been four DTI-supported trade missions. The Uzbek-British Trade and Industry Council promotes trade and investment. The DTI and British Council together with the Embassy, also sponsored a highly-successful "Festival of Britain" in Tashkent in October 1997, combining a trade fair with exhibitions and events linked to British culture and heritage.

DRUGS

  9. Uzbekistan is an important transit route for opiates from south-west Asia to Russia and Europe. In addition to pressing the EU Commission to speed up implementation of the Central Asia Drugs Initiative we have supplied inspection equipment to the Uzbek Customs and Border Guards and have contributed to three UNDCP projects. The heads of the Uzbek Drug Control Commission and State Customs Committee have also visited the UK to discuss drugs issues and possible co-operation.

ENVIRONMENT

  10. In 1998 DFID funded the participation of two experts in a UNDP project to look at the problem of the Aral Sea, which by 1995 had lost nearly three quarters of its volume and half its surface area due to poor environmental management in the Soviet era.


 
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