Экономическое развитие узбекистана на основе инновационной деятельности

“Иқтисодиёт ва инновацион технологиялар” илмий электрон журнали. № 5, сентябрь-октябрь, 2015 йил

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F. Shokirova,

Lecturer of the Department

of Economic Sciences

The State Tax Academy

of the Republic of Uzbekistan

ECONOMIC DEVELOPMENT OF UZBEKISTAN ON THE BASIS OF

INNOVATIVE ACTIVITY

Ушбу маколада Ўзбекистон иқтисодиётини институционал- инновацион

салоҳият асосида барқарор ўсиш муаммолари кўриб чикилган. Миллий
иқтисодиётни ракобатбардошлигини ошириш, юкори ва барқарор иқтисодий
ўсишни саклаб колиш учун билимларга асосланган иқтисодиётни
ривожлантиришни таъминлаш муҳимдир. Реал секторни модернизацияси ва
технологик қайта қуришни рағбатлантириш, фан сиғими юқори бўлган
саноатни ва бутун иқтисодиётни инновацион моделга ўтказишнинг молиявий-
инвестицион ва қонуний жиҳатларига эътибор берилган.

В данной статье рассматриваются вопросы стабильного развития

экономики Узбекистана на основе прочного структурно-инновационного
потенциала. Для поддержания и повышения конкурентоспособности
национальной экономики необходимо рассмотреть возможность развития
экономики знаний в целях достижения более высокого и устойчивого
экономического роста. Освещены вопросы совершенствования финансово-
инвестиционной,

нормативно-правовой

политики

стимулирующей

модернизацию и технологическое перевооружение реального сектора,
развития наукоемких производств и перевода экономики в целом на
инновационную модель.

Key words

:

innovation, economic development, investment activity, opportunities

for innovations, efficiency of innovative activity.

Nowadays, in the course of globalization of economy the reliance upon world’s

national economies and development factors is steadily increasing. The scientific and
technical potentials are rapidly developing and the intellectualization of the primary
production factors is growing. Innovative activity becomes a driving force in
economic development, which resulted in enforcement of international competition in
this area in many countries and increased the R&D spending, investment to new
technologies and production promotion to secure leadership in the course of
foundation of the global economy. The technological, intellectual, educational and
production know-how data is averaging from 70 to 85% of GDP growth in developed
countries[1]. The know-how introduction became a key factor in the market
competition, allowing leading companies achieve a profit increase by distributing an
intellectual rent which itself was founded through utilization of the efficient products
and technologies in a more monopolistic approach. This does not only determine the

“Иқтисодиёт ва инновацион технологиялар” илмий электрон журнали. № 5, сентябрь-октябрь, 2015 йил

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perspectives for economic growth, but also serves as an indicator of the level of
economic independence and well being of the country and its national status.

The modern Uzbekistan is the part of the world economic community and

therefore, a continued integration processes in the world's markets require foundation
of the new ideas and perspectives to ensure a stable economic development,
development of the structural and innovative potentials as one solid foundation of
country’s stability.

The Republic of Uzbekistan - one of the CIS countries, which ranks first in

Central Asia by its population (more than 31 million people[2]) and economic growth
indicators (more than 8% annually). Until recently Uzbekistan economy was
primarily oriented to produce and export of the raw materials such as cotton, natural
gas, gold, karakul lamb fur, silk, fruits and vegetables. Following its independence
declaration in 1991 the Government of Uzbekistan identified its transition to a
socially oriented market economy. During the years of independence the
diversification of economy was noted in the following areas: cotton monopoly was
eliminated, wheat and energy independence of the country was ensured, new sectors
of the industry as car manufacturing, pharmaceutical, information technologies and
etc. were developed, conditions for the development of the small business sectors and
private entrepreneurs were created, as well as foreign investment opportunities were
opened. In the country with concentration of more than 100 ethnical groups, all the
reforms were implemented on the background of political stability of the state,
consistent approach of the government to the selected reforms, gradual transition to
the market economy these all resulted in economic development. Beginning 1996 the
GDP growth has been reported in Uzbekistan’s economy in comparison with
previous years. The world’s financial-economic crisis has become challenging for the
economies of many states, including developed countries. However, during the years
the world’s economic crisis, the timely response of the Government with its Anti
Crisis Program helped to uphold the economic growth in Uzbekistan between 8-
9%[3]. According to 2008-2014 information of the State Committee for Statistics,
Uzbekistan’s GDP continued to maintain a relatively high level averaging 8.2 %,
state budget has reported a profit since 2005, the inflation rate averaged 6.5%, and
capital investments demonstrated a trend of a stable growth[4]. (Table #1)

Table 1

Main macroeconomic indicators (% in compare to the previous year)*

Indicators

2011

2012

2013

2014

1

2

3

4

5

GDP

108,3

108,2

108,0

108,1

GDP, per capita

105,5

106,6

106,3

106,2

Consumer Price Index (to the December of
previous year)

7,6

7,0

6,8

6,1

Industry production

106,3

107,7

108,8

108,3

Agriculture production

106,6

107,0

106,8

106,9

Capital investments

107,9

111,6

109,8

109,6

Construction

108,5

111,5

116,6

118,3

“Иқтисодиёт ва инновацион технологиялар” илмий электрон журнали. № 5, сентябрь-октябрь, 2015 йил

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Logistics

108,7

105,4

104,4

105,0

Passenger transportation

105,9

105,8

104,2

104,8

Services - total

113,2

114,2

114,3

115,4

Retail turnover

116,4

113,9

114,8

114,3

The resident population (mean for the
period)

102,7

101,5

101,6

101,7

The number of employed

102,5

102,6

102,5

102,4

* Data from State Statistical Committee of the Republic of Uzbekistan.

As evidenced by data in the table, for the period 2011-2014, the growth rate of

Uzbekistan's GDP remained at a high level (average of 8.2%), the state budget was
executed with a surplus (since 2005), the inflation rate is about 6.8%, while
investments in fixed capital have had positive growth trend.

There is no doubt that these indicators are the results of the great achievement,

but the economic policy must be focused in fostering a rapid economic growth in
order to reduce a gap in development of industrialized countries. In the effort to
maintain and increase a competitiveness of the national economy, Uzbekistan must
focus on a more active use of innovations and new technologies, that remain to be a
relatively passive area in the country, as well as it is essential to open an opportunity
for economic knowledge improvement in order to achieve a higher and a more stable
economic growth. A public product not only illustrates its material substrate, but
already distinguishes its functional purpose and informative – cognitive contents.
Production cost indicators are more prone to depend on non material investments: -
scientific research and development cost, purchasing certifications and licenses,
education and professional development of the specialists, software, engineering and
consulting services, improvement of management structure and etc. These all,
eventually, determine competitiveness of enterprises and their products on both local
and foreign markets.

Innovative reforms require considerable material, financial and intellectual costs

(from the project foundation stage, fundamental research and finalizing with
commercial distribution of the results of the scientific developments), which can be
afforded by the state only, especially in the conditions of economic crisis. Developed
countries increase their innovation costs in GDP. The stabilization trend for these
expenses average 2-4%. Whereas, the state share of the same expenses averages 45-
55%. Uzbekistan’s internal R&D spending averages 0.15% of GDP, hi-tech sector’s
share, which requires the highest intellectual investment, reserves 1%[5]. According
to information of the Committee for Coordination of Scientific and Technological
Development under the Cabinet of Ministers of the Republic of Uzbekistan the
primary cost of technological innovations is state funded (about 60%), 20% received
from foreign investments, 14% - by bank loans and 6% from other sources.
Regretfully, investments from private businesses, banks, insurance companies and
other sources in funding R&D, are extremely limited. Same picture is observed with
the alternative sources of investments such as equity and long term financing, grants
of international financial institutions, venture financing and other progressive forms
of the financial support. The innovative activity sector’s insufficient development

“Иқтисодиёт ва инновацион технологиялар” илмий электрон журнали. № 5, сентябрь-октябрь, 2015 йил

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resulted in a slowed down disposal of physically and morally tired primary funds in
the real sector of economy. Presently a production depreciation indicator averages
45,1%. A 46-year-old existing equipment and machinery are outdated[6]. This
indicator is even higher in agro machinery, metal, chemical and oil and chemical
manufacturing, in constructional production, light textile and food industries[7].

In order to avoid a technological retardation of the manufacturing the

rehabilitation measures, which determine the conditions for renewal of production
equipment, are being implemented within the framework of Investment and Sector
Programs, adopted by the government on technical modernization,. Herewith, the
priority is given to investment projects, which are directed to create the new highly
technological productions that provide a detailed processing of the local raw material
resources. Thus, in 2014, in the framework of these investment projects the leading
sectors of local economy received a 4.2 billion USD worth 154 large enterprises,
which are equipped with high-tech modern equipment[8].

The following projects are among them: “Damas” and “Orlando” vehicles

production on the basis of “Khorezm automobile manufacturing association Ltd”
with an annual turnover of 60 thousand vehicles; “Reconstruction of zinc factory”
with 80 thousand tons processing capacity of zinc concentrate annually,
“Construction of a new sulfuric acid manufacturing unit on the basis of copper
melting factory”; “Large scale modernization of Syrdarya Thermal Power Plant”
with 50 MW (megawatt) of electricity production annually; “Thread spinning
manufacturing on the basis of “Mangit, Ltd” in the Republic of Karakalpakstan with
capacity of 5 thousand tons and others. The creation of the specialized industrial
zones (SIZ): SIZ “Angren”, SIZ “Djizak” and SIZ “Navoi” provided to the investors
the packages of tax benefits and preferences, which are secured on government funds
as well as necessary outsourced engineering and transport infrastructure, has become
a powerful reason in fostering high-tech production development.

In order to transit the economy to a new innovative development model the

modern high-tech structure as well as sufficient financial resources are not the only
required factors, whereas budget funds efficiency, out-of-budget financing, which is
aimed to foster the area of science and technology, improvement of legislative
systems in order to attract various sources of financing, promoting technical
refurbishment of scientific based productions, realization of state owned important
structural innovative projects.

In this regard only those directions, which provide a strong incentive of the long

term innovative activity perspectives, must be strengthened in the strategy of the state
policies. The world’s experience proves that the stable development and economical
growth are not secured by mechanisms of market management, where the importance
of the government with its direct and indirect influence on national economy is
outlined. In this respect a wide spectrum of economic, legislative and administrative
measures are being implemented (Table 2).

“Иқтисодиёт ва инновацион технологиялар” илмий электрон журнали. № 5, сентябрь-октябрь, 2015 йил

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Table 2

State regulation of investment- innovative activities

1

Financial

Stimulating

Legal

Organizational

Direct

Indirect

Direct

Indirect

1

2

3

4

5

6

7

Ac

ti

ons

Funding of
innovative
activity out
of the state
budget and
specialized
extra-
budgetary
funds;
partial
compensati
on of
interest
rates on
credits of
commercial
banks

The
provision
of tax
incentives
and
preference
s; partial
or full
exemption
from
payment
of taxes;
granting
the right to
use state-
owned
property

The increase
in social
status of
innovation
activities;
public order;
the provision
of guaranteed
markets for
innovation;
provision of
state
guarantees to
secure
repayment of
funds raised
for the
implementati
on of
innovation

The
innovatio
n-
oriented
activities
containe
d in the
target
programs

The definition
of priorities of
innovative
development;
development
of innovative
programs;
creation of
legal base of
innovative
processes, the
systems of
copyright
protection,
innovators and
intellectual
property
protection

The creation of
development
institutions (funds,
programmes,
associations); the
formation of innovation
infrastructure; support
and development of
innovative potential;
scientific and
methodological support
and staffing innovation;
creation of conditions
for attraction of
investments; providing
of innovative activity
information base

It is recommended that the efforts of the state policy in pursuing innovative

activity development on a macro level must be concentrated towards the healthy
environment for refurbishment and future increase of production, structural,
entrepreneurial and investment activity, securing stable guarantees that warrant
investments into a real sector of economy. As for the macro level, it is important to
provide clear and determinative steps as to improve the production efficiency on the
basis technical and technological refurbishment, introduction of the progressive
production and managerial decisions. This requires an improvement of state policy on
development of science, technology, investments and innovations through the
following measures:

-

Development and improvement of the legislative ground for innovative

activity, its promotional mechanisms, institutional transformations’ systems,
intellectual property protection in the innovative area and its introduction to the
economic turnover;

-

Creation of complex support systems for innovative activities;

-

Production development, increasing competitiveness and scientific production

exports;

-

Development of the innovative process’s infrastructure, as well as the systems

of informational support, expertise, financial-economic system, production-

1

The table created by the author

“Иқтисодиёт ва инновацион технологиялар” илмий электрон журнали. № 5, сентябрь-октябрь, 2015 йил

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technological support, a system of certification and promotion of innovations,
specialists’ professional development systems;

-

development of small innovative entrepreneurship by providing a healthy

environment for establishment and a successful functioning of the small high-tech
companies and providing them a state support at the early stage of activity;

-

improving a competitive system of selection of innovative projects and

programs;

-

implementation of the relatively quick repayment small innovative projects

with the assistance of the private investors and support of the government in the field
of economy;

-

implementation of the critical technologies and prioritizing the directions that

can facilitate transformation of the appropriate sectors of the country's economy and
its regions;

-

a selection of a relatively small number of essential technologies that influence

over final processes of production efficiency determination and competitiveness in
the sector of economy and promoting a transition to a new technological structure;

-

a quick adaptation to the local and foreign scientific technical and

technological achievement of international importance, regeneration of the natural
resources.

In our opinion an improvement of the systems for promotion of private

investments remains to be effective in fostering internal sources of financing which
are the indicators of reliance on the reform policies. An increase of such savings
allows reducing state’s external debts and promotes an advanced technological
progress more than direct control over the monetary supply.

In the course of establishment of the state’s state social-economic policy and

stimulating of innovative activities the following appropriate measures must be
considered: providing an interconnection between economic, social and scientific –
technological development aspects in the framework of the unified innovative policy;
consideration of the innovative processes unspecified levels; ensuring a freedom of
scientific and scientific-technological works, legal protection of the intellectual
property; assisting in development of the competitiveness in the fields of science and
technology; stabilizing the prioritized directions of the resources in science and
technology development; flexibility of the policy of innovations; integration of
education, science and entrepreneurship; promoting international cooperation.

In summarizing our research, we highlight, that the implementation of the listed

measures yields new investments, new technologies, employment opportunities, as
well as contribute to the development of scientific-technological potential,
sustainable growth, increased competitiveness of the national economy and create
guarantees of economic security of the country.

Reference:

1.

Glazyev S. Y. (2010)

Rapid development Strategy of Russia in

conditions of

global crisis

. – Moscow, Economy.

2.

http://www.stat.uz/ru/index.php/interaktiv/demograficheskie-dannye

“Иқтисодиёт ва инновацион технологиялар” илмий электрон журнали. № 5, сентябрь-октябрь, 2015 йил

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3.

Karimov I. A. (2009)

World financial-economic crisis, ways and measures to

overcome it in the conditions of Uzbekistan

. - Tashkent, 2009. - p. 25.

4.

The materials of the State Committee of Uzbekistan on statistics. Statistical

review of the Republic of Uzbekistan for 2008-2014 (2015)

. (in Russian)

5.

Capacity building for private business in Uzbekistan. Abstracts of the VII

Republican fair of innovation ideas, technologies and projects. Tashkent

., April 25,

2014. (in Russian)

6.

The materials of the State Committee of Uzbekistan on statistics. Industry of

Uzbekistan 2013

. Tashkent: 2014. (in Russian)

7.

http://www.stat.uz/ru/index.php/90-interaktivnye-uslugi/ekonomika-v-

tsifrakh/771-makroekonomicheskie-pokazateli-respubliki-uzbekistan

8.

Karimov I. A. (2015).

Report of the President of the Republic of Uzbekistan

at the session of the Cabinet of Ministers dedicated to the results of socioeconomic
development in 2014 and most important priority directions of economic program for
2015.

Tashkent. Uzbekistan (in Russian).