ADB Sees Uzbekistan Continuing on a Growth Path
According to the Asian Development Bank, Uzbekistan remains one of the most dynamic growth markets in Central Asia. Over the next two years, the economy is expected to expand by nearly 7 percent annually—driven by consumption, investment, and the country’s ongoing transformation. However, this optimistic outlook comes with a caveat: global risks are mounting, and old structural weaknesses are far from being overcome.
According to the ADB, the Uzbek economy grew by 7.7 percent last year, exceeding even expectations. This continued the strong growth trajectory, following a 6.7 percent increase in gross domestic product in 2024. The economy remained so robust primarily because nearly all major economic sectors grew simultaneously.
Services, construction, and consumer spending drive the upswing
Once again, the services sector saw the strongest growth. It expanded by 14.7 percent, benefiting primarily from trade, logistics, digital services, and tourism. Industry also performed solidly: excluding the construction sector, growth stood at 6.8 percent. The construction sector itself grew by as much as 14.2 percent, driven by investments in housing and infrastructure. Even agriculture, which often grows more slowly, still managed a 4.4 percent increase.
For the ADB, it is clear: domestic demand remains the backbone of this growth. Real household incomes rose by 9.2 percent in 2025. At the same time, investment increased by 10.5 percent. Capital flowed primarily into industry, logistics, construction projects, and urban development. This momentum was driven by corporate funds, household savings, and foreign direct investment.
Consumption also continued to pick up. Cashless online sales rose sharply, as did revenues in retail and financial services. This demonstrates that the Uzbek economy thrives not only on individual large-scale projects but also on broadening domestic economic activity.
ADB Country Director Kanokpan Lao-Araya therefore sees the country in a comparatively strong starting position. The real challenge now, she says, is to turn the current momentum into more productive growth driven more strongly by the private sector.
Solid data—but no sure thing
For 2026 and 2027, the ADB expects slightly lower but still very high growth of 6.7 and 6.8 percent, respectively. However, these forecasts are based on assumptions made back in March—at a time when many observers still expected the situation in the Middle East to stabilize soon. Since then, this hope has become significantly more fragile. Consequently, the external context on which parts of the forecast are based is also subject to uncertainty.
Nevertheless, the macroeconomic data initially show an improvement. Inflation fell faster than expected in 2025 to 7.3 percent, down from 9.8 percent the previous year. A tighter monetary policy, a stronger exchange rate, and easing cost pressures contributed to this. Inflation is expected to continue to ease in the coming years. The ADB forecasts 6.5 percent in 2026 and a gradual convergence toward the central bank’s inflation target of 5 percent by 2027. However, this is not entirely risk-free: higher energy prices or food supply issues could slow down disinflation.
The fiscal situation also improved. The deficit fell from 4.0 to 2.1 percent of gross domestic product, even though the government did not cut back on social spending. At the same time, the external economy improved: Exports rose sharply, remittances from migrant workers increased significantly, and the current account deficit narrowed to around 2.5 percent of GDP. Foreign exchange reserves remained at a high level, supported by revenues from trade, tourism, and remittances.
Dependence on gold and pressure for reform remain
However, this is precisely where the second, less comfortable side of the outlook begins. For despite all the progress, Uzbekistan remains heavily dependent on gold exports. The precious metal accounted for nearly a third of total exports last year. This leaves the economy vulnerable to fluctuations in commodity markets.
The ADB therefore makes clear what matters most now: faster reform of state-owned enterprises, more modern regulation, and swift accession to the World Trade Organization. WTO accession could institutionally anchor reforms, boost competitiveness, and attract higher-quality investment. Without these steps, growth may remain high but risk being structurally less resilient.
Added to this are the well-known external risks: volatile financial markets, uncertainty in global trade, potential burdens from the public sector, and ongoing geopolitical tensions. All of this can hit a country like Uzbekistan—which is heavily reliant on openness, capital inflows, and stable framework conditions—hard.
Nevertheless, Uzbekistan continues to fare well in a regional comparison. For Central Asia as a whole, the ADB forecasts growth of 4.2 percent in 2026 and 4.4 percent in 2027. Uzbekistan is thus growing well above the regional average—and remains one of the region’s key drivers.
