Reducing thе role of the state and attracting private investment

ТРАНСФОРМАЦИЯ 2030 > Reducing thе role of the state and attracting private investment
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PRIORIТY З

Reducing thе role of the state and attracting private investment
STRATEGIC CHALLENGES:

The direct participation of the state in the supply of resources for farmers, as well as the production and marketing of products, limits the attraction of private investment in the sector. The effective use of funds from credit lines of international financial institutions is limited by the under-development of advisory services for agri-businesses, а lack of business management skills, human resources in the agro-industrial complex, and the banking sector. There are no incentives to promote the use of good agricultural and environmental practices (GAEP), good manufacturing practices (GMP), and other standards. There are also no structures, systems, or mechanisms for independent monitoring and evaluation of investment impact effectiveness.

STRATEGIC OBJECTIVES:

The main objective of this strategic priority is therefore to create an effective system to facilitate the attraction of private investment for the modernization, diversification and sustainable development of the agri-food sector.

КЕУ STRATEGIC ACTIONS:

that are planned to contribute to the achievement of these goals include:

Cessation of public procurement of agriculture commodities, with the exception of strategic purchases necessary to ensure price stability in the domestic market;

Improving financial support mechanisms for agricultural producers from the state, including subsidizing the interest rate of commercial loans, allocated for the production of certain strategically important agricultural products;

Improving lending and insurance mechanisms in accordance with the strategic priorities and needs of the agri-food sector;

Improving the activities of the State Fund for Entrepreneurship Support under the Agency for the Development of Small Business and Entrepreneurship;

Introduction of а “warehouse certificate” mechanism when crediting the agricultural producers Expansion of the Uzbek Commodity Exchange trade in agricultural products;

Development of transparent partnership mechanisms bу introducing additional mechanisms and financial instruments, as well as ensuring equal access for market participants;

Increasing competition in the market of resources and services through the privatization of nonstrategic state enterprises in the field of resources and services supply;

Abolition of the practice of providing resources and the provision of services at the expense of preferential loans;

Assistance and encouragement of initiatives оn the basis of futures contracts between subjects of the agro-industrial complex;

Improvement of the mechanism of land use rights as collateral bу reviewing the market order of determining the value of the right to lease land;

Development of an investment program to ensure targeted attraction of credit lines of international financial institutions;

Improvement of mechanisms for assisting commercial banks in the provision of credit resources for dekhkan farms and owners of land plots;

Revision of agricultural crops allocation;

Improvement of the motivation system for the implementation of intensive innovative technologies in agriculture.

КЕУ PERFORMANCE INDICATORS AND TARGEТS
Improved ranking in the World Bank Enabling the Business of Agriculture (ЕВА) Index
Increase in total value of attracted capital investments in agri-food business
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ROADMAP FOR IMPLEMENTATION

SHORT TERM ACTIONS

1

March 1, 2020

The Ministry of Agriculture, Ministry of Finance, Central Bank, stakeholder ministries and agencies

Sophistication of mechanism for the government support of Agriculture products producers. Thereat, the following is envisaged:
– revisiting the activities of the fund for the government support of agriculture under the Ministry of Finance of the Republic of
Uzbekistan
– subsidise the interest rates of loans allocated for producing individual strategically important agriculture products;
– improve financial literacy of agriculture products producers are envisaged.

2

Мау 1, 2020

The National Commodity Exchange, Ministry of Agriculture, Ministry of Economy and Industry, Ministry of Investments and Foreign Trade

Expantion of the activities of the Uzbekistan Commodity Exchange in trading in agriculture products.
Thereat, the following is envisaged:
– development of transparent mechanism of cooperation through introduction of additional mechanisms and financial instruments, and establishment of equal conditions for the market participants.

Medium and long term actions

3

Q 4 2021

Ministry of Investment and Foreign Trade, Ministry of Agriculture, Ministry of Finance, Ministry of Economy and Industry

Development of investment programs to ensure targeted attraction of credit lines of international financial institutions based оп the results of needs assessment of the agricultural sector in private investments and subsidized loans.

4

Q 1 2021

Ministry of Agriculture, Ministry of Finance, Ministry of Water Resources

Development of additional measures for the development of publicprivate partnership mechanisms in the agri-industrial complex.

5

Q З 2021

Ministry of Agriculture, Ministry of Finance, Ministry of Economy and Industry

Increased competition in the market of material and technical resources through the privatization of non-strategic state enterprises in the sector of material and technical resources supply and provision of services to farmers and agricultural processing enterprises. At the same time:
– Abolish the practice of providing material and technical resources as well as services at the expense of state credit funds;
– Pilot implementation of standardized advance contracts to promote sustainaЫe trade relations between agribusiness entities.

6

Q З 2021

Ministry of Finance, Central bank, Ministry of Agriculture

Transition to а system of subsidizing bу the State Support Fund for Agriculture under the Ministry of Finance of exclusively interest rates оn loans from commercial banks.

7

Q 3 2022

Ministry of Finance, Ministry of Agriculture, Ministry of Economy and Industry

Ensuring а complete transition to ап agricultural support system that stimulates the intensification of agricultural production.

8

Q 1 2023

Ministry of Agriculture, Council of farmers, dekhkan farms and homeowners, Ministry of Economy and Industry

Removal of the state from the practice of crop allocation.