International Journal of Management and Economics Fundamental
13
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VOLUME
Vol.05 Issue01 2025
PAGE NO.
13-19
10.37547/ijmef/Volume05Issue02-04
Assessment of the investment attractiveness of
Samarkand region: the impact of digital economy
development on investment attractiveness
Saydullaev Abbosjon
Assistant professor of the Department of “Green Economy and Sustainable Business” Samarkand branch of Tashkent State University of
Economics, Uzbekistan
Sultonov Beknazar
Associate professor of the Department of “Green Economy and Sustainable Business” Samarkand branch of Tashkent State University of
Economics, Uzbekistan
Received:
04 December 2024;
Accepted:
06 January 2025;
Published:
08 February 2025
Abstract:
This study aims to examine the investment attractiveness of the Samarkand region by focusing on the
Samarkand region and analyzing the impact of the development of the digital economy on investment potential.
The research is based on the major indicators such as openness index, economically active population, infant
mortality rate, crime rate, export and import, per capita income, pollution, registered legal entities, Internet users,
wages in the information and communications industry, and employment in the knowledge economy. The results
underscore the importance of digitalization in improving the transparency of the economy, and the overall
attractiveness of investments. The findings also provide further recommendations necessary to increase
investment in the region and strengthen digital structures.
Keywords:
Investment attractiveness, IPI, digital economy, economic development, Samarkand region.
Introduction:
Attracting investments is of great
importance in the development of the economy of
Samarkand region, providing great opportunities for
increasing the economic potential of the region and
creating new jobs. Effective attraction of investments
and their efficient use serve to ensure the
competitiveness of the region. On November 20, 2024,
at a meeting held by our President on the socio-
economic development of Samarkand region, it was
noted that next year, within the framework of regional
programs, Samarkand region has the opportunity to
absorb at least
1 billion 850 million dollars in investments, create 20
thousand jobs and produce an additional 1.2 trillion
soums of products. By conducting a comparative
analysis of the state of investments attracted to
economic sectors in Samarkand region, it is possible to
determine in which sectors this process is more active
and in which areas it is slower.
First of all, in recent years, investments in agriculture
have significantly increased in the region. This is mainly
explained by the high potential of Samarkand for the
production and export of agricultural products.
Projects implemented to develop homestead farms,
introduce modern irrigation systems, and modernize
agricultural machinery are a vivid example of this. Also,
with the help of foreign investments, the possibilities
for processing and storing agricultural products have
improved.
The scale of investment attraction in the industrial
sector is also growing. The region's industrial
enterprises are implementing a number of projects to
upgrade technologies and increase the range of
products. In particular, investments are being made in
the light industry, construction materials production,
and the food industry. Investments attracted to these
International Journal of Management and Economics Fundamental
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International Journal of Management and Economics Fundamental (ISSN: 2771-2257)
sectors allow the region to increase production
volumes and expand exports. At the same time, the
region's wealth in mineral resources provides
additional opportunities for continuing to attract
investment to the industrial sector.
The service sector, in particular, tourism and transport
infrastructure, occupy a special place in attracting
investments in the Samarkand region. Samarkand's rich
cultural heritage and tourism potential have
significantly increased the flow of investments aimed at
the tourism sector. The construction of new hotels,
restaurants and other tourism facilities is increasing the
attractiveness of the region for international tourists.
The modernization of transport infrastructure, in
particular, the international airport and high-speed
railway lines, has become one of the important factors
in attracting investments in the service sector.
METHODS
Such a comprehensive analytical approach to assessing
the factors affecting the investment attractiveness of
the Samarkand region is proposed in this research,
paying special attention to the impact of the growth of
the digital economy. The use of dynamic analysis,
integrated assessment, analysis and synthesis,
comparative analysis and statistical evaluation
methods allows for maximum consideration of all
aspects of the investment potential of the region.
To evaluate the investment attractiveness of the
Samarkand region, this study employs the Investment
Performance Index (IPI) as a key metric. The IPI serves
as a composite indicator that reflects the effectiveness
of investment policies and the stability of economic
conditions within the region.
The IPI is interpreted as follows:
IPI = 1
–
This represents the optimal value, indicating
that investment attraction policies are well-structured,
economic stability is maintained, and no significant
destabilizing factors are present.
IPI > 1
–
A value above 1 suggests that the volume of
investments attracted to the region exceeds its
contribution to the formation of the country’s Gross
Domestic Product (GDP). This scenario often arises due
to factors such as high profitability potential,
technological advantages, strategic location, post-crisis
recovery, mass privatization, or the discovery of new
natural resources. Additionally, a surge in investor
interest can contribute to a higher IPI.
IPI < 1
–
A value below 1 indicates that the share of
investments in the region contributes less to the
country’s GDP than expected. This may be linked to
economic instability, ineffective or inconsistent
investment policies, weak competitiveness, or
structural constraints.
By integrating IPI with other economic, social, and
digital transformation indicators, the study provides a
comprehensive assessment of the investment climate
in the Samarkand region and its alignment with
national and global economic trends.
Data Collection and Sources
Primary and secondary data sources are used in the
study. The statistical data for major economic
indicators, digital infrastructure, business activity and
socioeconomic aspects were provided through official
publications received from Uzbekistan’s State Statistics
Committee, various sources of regional investment
reports, and other reliable sources. Additionally, a
more comprehensive comparative picture was given
at the expense of the statistics of international
economic organizations.
RESULTS
Compared to other regions, Samarkand region has
attracted investments at an average level, but the
volume of investments in this region is noticeably
higher than in some regions. It should also be noted
that some sectors of the economy in Samarkand region
are developing slowly in attracting investments. For
example, investments in information technologies and
the digital economy are still low compared to other
sectors. This indicates the need to develop digital
infrastructure and attract foreign investments in this
area to increase the competitiveness of the region. The
development of the digital economy can serve to
increase efficiency in all sectors of the region.
Table 1.
Growth dynamics of investments in fixed capital by regions of the republic
Regions
2019
2020
2021
2022
2023
Growth in
2023
compared to
2019, in %
By republic
195927,3 210195,1 239552,6
266240 356071,4
181,7
Karaqalpakistan R.
8750,6
7089,8
8110,7
10254
12959,2
148,1
Andijon reg.
7452,1
9622,6
11176,6
14339,8 18639,1
250,1
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Bukhara reg.
10366,6
12183,9
20528,3
21638,3 31030,5
299,3
Jizzakh reg.
7900,9
12545,4
9233,6
10373,9 14970,9
189,5
Qashqadarya reg.
24462,5
20557,6
17359,1
16012,8
21138
86,4
Navoiy reg.
17646,3
15688,4
15020,1
17958,1 26398,6
149,6
Namangan reg.
12084,9
12007,2
12982
14775,1 19220,1
159,0
Samarkand reg.
10266,7
14656,4
15641,6
18917,1 25717,1
250,5
Surkhondarya reg.
11835,1
10068,2
12037,8
11569,4 18307,7
154,7
Syrdarya reg.
5869,1
7191,9
8051,8
12354,6 15871,8
270,4
Tashkent reg.
20353,9
21148,6
28113,6
35767,7 47709,3
234,4
Fargona reg.
8685,4
11040
12625,2
15419,3
19955
229,8
Khorazm reg.
5032
5391,8
8292
8769,7
11666,1
231,8
Tashkent
42458,1
50371,4
58172,7
56847,9 71143,7
167,6
From 2019 to 2023, the volume of investments in
Samarkand region increased by 250.5%. We can see
that this increase is much higher compared to the
average indicator for the republic (181.7%). If we
compare between regions, the growth rate of
investments in Samarkand region ranks 3rd in the
republic after Syrdarya (270.4%) and Bukhara (299.3%)
regions.
Analysis of the indicators of investments in fixed capital
per capita by region of Samarkand region allows us to
draw important conclusions about the economic
potential of the region and the level of interregional
development. This indicator is an important criterion
for determining the distribution of investment
resources, the pace of economic development and the
level of attractiveness of regions. In recent years, this
indicator has undergone significant changes in
Samarkand region, and we can see an increase in
economic activity in different regions.
Table 2.
Dynamics of changes in investments in fixed capital per capita by region of
Samarkand region, thousand soums
2019
2020
2021
2022
2023
Growth in
2023
compared to
2019, in %
Samarkand region
2 674,9
3 746,0
3 920,7
4 642,5
6 177,0
230,9
Samarkand city
7 584,5 11 391,3 8 222,6
9 410,9
10 770,0
142,0
Kattakurgan city
1 795,7
4 398,4
4 363,3
3 240,9
3 105,7
173,0
Akdarya
3 856,8
4 014,9
2 455,7
2 297,7
3 209,2
83,2
Bulungur
1 804,9
2 266,7
2 820,7
2 034,1
3 657,0
202,6
Jambay
2 324,1
2 987,5
2 296,1
3 558,8
4 773,6
205,4
Ishtikhan
1 830,7
1 378,5
2 844,9
1 000,0
1 742,8
95,2
Kattakurgan
6 570,3
909,4
1 135,4
4 371,1
22 353,9
340,2
Kushrabot
4 114,9
7 260,0
6 645,2
6 772,5
4 488,6
109,1
Narpay
855,1
1 359,6
1 388,0
1 522,4
2 229,3
260,7
Payarik
693,8
1 872,8
4 934,4
2 589,9
2 293,1
330,5
Pastdargom
1 652,5
2 202,6
2 305,6
2 949,5
5 150,7
311,7
Pakhtachi
1 885,0
2 968,1
3 006,2
1 673,7
2 818,6
149,5
Samarkand
2 572,9
4 588,5
9 002,2 15 534,1 10 529,9
409,3
Nurobod
2 513,1
3 022,1
4 146,1
9 171,8
6 595,6
262,4
Urgut
1 531,2
1 470,4
1 637,4
1 739,9
2 158,2
140,9
Toylok
2 446,5
2 458,7
3 233,2
2 549,8
3 700,8
151,3
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International Journal of Management and Economics Fundamental (ISSN: 2771-2257)
In 2019, the volume of investments per capita in the
region amounted to 2,674.9 thousand soums, while in
2023 this figure reached 6,177.0 thousand soums,
which is an increase of 230.9%. The largest increase
among the regions was recorded in Samarkand district,
where the figure increased from 2,572.9 thousand
soums in 2019 to 10,529.9 thousand soums in 2023, an
increase of 409.3%. This result was due to large
investment projects implemented in this region,
including the development of tourism and industrial
infrastructure. The city of Samarkand also showed high
results, reaching 10,770.0 thousand soums in 2023
from 7,584.5 thousand soums in 2019. Kattakurgan
district is also among the regions that have achieved
significant growth. Here, the volume of investments
per capita increased by 340.2%. Other regions of the
region, including Pastdargom (311.7%), Payarik
(330.5%) and Nurabad (262.4%) districts, also had high
growth rates. Agricultural and industrial projects
implemented in these regions, as well as effective
cooperation between the state and the private sector,
are contributing to the increase in investments. At the
same time, we can see a decrease in the volume of
investments per capita in some regions. For example,
in the Akdaryo (-16.8%) and Ishtikhon (-4.8%) districts,
the share of investments in fixed capital decreased.
This indicator indicates low investment activity in the
region and insufficient attraction of resources. This
indicates the need to implement additional measures
to attract investment resources in these regions.
The dynamics of changes in fixed capital investments by
types of economic activity in the Samarkand region
reflects the different directions and priorities of the
development of the regional economy.
According to the indicators in Table 3, the largest
increase in terms of investment volume was observed
in the “Transportation and Storage” sector. In this
sector, the volume of investments in 2023 increased by
10,441.1% compared to 2021. We can see a significant
increase in attention to transport infrastructure and
logistics services in this region. This growth indicates
the implementation of large-scale projects aimed at
developing transport networks and storage capabilities
in the region.
Table 3.
Dynamics of changes in investments in fixed capital by types of economic activity in
Samarkand region, billion soums
№
Types of economic activity
2021
2022
2023
Growth in 2023
compared to 2019, in %
Difference
(+,-)
In percent
%
1
Agriculture, forestry and fishing 1719,1
1821,1
1923,1
204,0
111,9
2
Mining and quarrying
212,7
364,1
515,5
302,8
242,4
3
Manufacturing
4129,4
6782,8
9436,2
5306,8
228,5
4
Electricity, gas, steam and air
conditioning
744,4
1365,8
1987,3
1242,9
267,0
5
Water supply, sewage, waste
collection and treatment
478,5
566,2
653,8
175,3
136,6
6
Construction
1471,0
1326,8
1182,7
-288,3
80,4
7
Wholesale and retail trade, repair
of
motor
vehicles
and
motorcycles
1825,4
1442,9
1060,4
-765,0
58,1
8
Transportation and storage
354,5
2027,7
3701,0
3346,5
1044,1
9
Accommodation
and
food
services
2676,1
1999,6
1323,1
-1353,0
49,4
10
Information and communication
88,6
100,1
111,5
22,9
125,8
11
Financial
and
insurance
activities
70,9
46,2
21,5
-49,4
30,3
12
Professional,
scientific
and
technical activities
903,9
1468,6
2033,4
1129,5
225,0
13
Education
779,8
751,6
723,3
-56,5
92,8
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Health and social work activities
460,8
487,2
513,6
52,8
111,5
15
Arts,
entertainment
and
recreation
177,2
186,8
196,4
19,2
110,8
16
Excluding
total
activities:
investment
in
residential
construction
886,1
685,4
484,7
-401,4
54,7
17
Other activities
744,4
828,9
913,5
169,1
122,7
One of the assessment methods used in a
comprehensive
assessment
of
investment
attractiveness is the Investment Performance Index
(IPI). This index is calculated as follows:
𝑰𝑷𝑰 =
𝑰𝒏𝒗
𝒊
/𝑰𝒏𝒗
𝒋
𝒀𝒂𝑯𝑴
𝒊
/𝒀𝒂𝑰𝑴
𝒋
Here,
𝐼𝑛𝑣
𝑖
- the amount of investment made in region i;
𝐼𝑛𝑣
𝑗
- the amount of total investment made in the
country;
𝑌𝑎𝐻𝑀
𝑖
- the gross regional product of region i;
𝑌𝑎𝐼𝑀
𝑗
- the gross domestic product of the country
At the end of 2023, the GDP volume was 1,192,162.5
billion soums, and the gross regional product of the
Samarkand region was 84,093.8 billion soums. The total
volume of investments in fixed capital in the base year
was 356,071.4 billion soums, of which the volume of
investments in fixed capital in the Samarkand region
was 25,717.1 billion soums.
𝑰𝑷𝑰 =
𝟐𝟓𝟕𝟏𝟕, 𝟏/𝟑𝟓𝟔𝟎𝟕𝟏, 𝟒
𝟖𝟒𝟎𝟗𝟑, 𝟖/𝟏𝟏𝟗𝟐𝟏𝟔𝟐, 𝟓
= 𝟎, 𝟎𝟕𝟐𝟐𝟐𝟓/𝟎, 𝟎𝟕𝟎𝟓𝟑𝟗 = 𝟏. 𝟎𝟐𝟒
Based on the above calculations, we can conclude that
the investment policy in the Samarkand region is being
implemented stably, and the IPI above 1 indicates that
the region is attractive to investors.
When assessing the investment attractiveness of the
Samarkand region, the analysis of key indicators
covering economic, social and environmental factors
will provide a more accurate assessment of the region's
investment attractiveness. As a result of the analysis of
these indicators, we can determine the region's
economic potential, existing opportunities and
challenges.
Table 4.
Indicators for assessing the investment attractiveness of the Samarkand region
№
Indicator
Measurement 2019
2020
2021
2022
2023
1 Resident population
thousand
people
3798,9 3877,4 3947,7 4031,3
4118,2
2
Resident population of
working age
thousand
people
2218,5 2237,6 2254,2 2272,2
2299,2
3 Infant mortality rate
per 1000
infants
7,1
6,5
6,5
6,7
8,2
4
Number of registered
crimes
unit
5016
5307
7505
7727
7843
5 Export
million dollars 398,5
335,2
531,7
636,6
766,8
6 Import
million dollars 1351,4 1156,4 1 388,8 1 729,0 2 125,6
7 Total income per capita
thousand
soums
9437,9 10522,8 12919 15437,1 16886,8
8
Pollutants emitted into
the atmosphere
thousand tons
44,2
52,7
39,4
39,0
52,3
9
Number of registered
enterprises and
organizations
unit
26297
33250
41145
49370
57511
10 Number of subscribers
thousand
1505,9 1795,4 2132,5 2407,4
2706,1
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connected to the Internet
people
11
Wages in the information
and communication
sector
thousand
soums
1894,8 2410,8 3438,2 5023,4
7495,5
12
Number of employees
working in legal entities
operating in the ICT
sector
people
1603
1871
1973
1973
2538
The number of permanent residents of Samarkand
region increased from 3,798.9 thousand people in 2019
to 4,118.2 thousand people in 2023. The annual growth
in the population increases the economic development
opportunities of the region. The growing population
expands the potential of the labor market and creates
a solid foundation for the development of the
consumer market. At the same time, population
growth creates additional demand in areas such as
infrastructure, transport, healthcare, and education.
This, in turn, indicates the need to attract additional
investments in these sectors in the future. The number
of working-age population increased from 2,218.5
thousand people in 2019 to 2,299.2 thousand people in
2023. This growth indicates the availability of
additional labor for production sectors. This will serve
to increase employment in the regional economy and
effectively use local resources. However, the proper
management of this labor force requires the
development of professional education and retraining
programs. The infant mortality rate per 1,000 live births
decreased from 7.1 in 2019 to 6.5 in 2021, but
increased to 8.2 in 2023. These changes indicate the
need to improve the efficiency of the health system.
The increase in child mortality requires attention to the
quality of medical services, in particular, improving the
medical care provided to mothers and infants. This
indicator may encourage investors to direct their funds
to improving the health infrastructure. On the other
hand, the quality of medical services in the region will
lead to an increase in the well-being of the population.
The number of crimes increased from 5,016 in 2019 to
7,843 in 2023. This increase indicates the need to
strengthen measures to ensure social stability and
reduce crime. A high crime rate can reduce the safety
and attractiveness of the investment environment.
Therefore, social problems can be solved by
implementing planned programs to reduce crime, in
particular, by increasing employment. The volume of
exports increased from $ 398.5 million in 2019 to $
766.8 million in 2023. This indicates an increase in the
foreign trade potential of the region. It is necessary to
stimulate the production of agricultural and industrial
products in the Samarkand region and continue to
support export-oriented enterprises. At the same time,
it is necessary to further diversify exports and focus on
the production of high value-added products. The
volume of imports increased from $ 1,351.4 million in
2019 to $ 2,125.6 million in 2023. We can see that such
an increase in imports has increased the negative
difference in the trade balance. This indicates the need
to reduce the dependence of the local economy on
imports. And it is precisely this that indicates a high
demand for investments in the field of local production
of import-substituting products. Per capita income
increased from 9,437.9 thousand soums in 2019 to
16,886.8 thousand soums in 2023. This indicates an
improvement in the economic well-being of the
region's population. This growth leads to an expansion
of domestic market demand, the development of trade
and service sectors. The volume of pollutants emitted
into the atmosphere increased from 44.2 thousand
tons in 2019 to 52.3 thousand tons in 2023. This
exacerbates
the
problem
of
environmental
sustainability. This indicator indicates the need to
strengthen environmental protection policies and
attract large-scale investments in the introduction of
green technologies. The number of enterprises, which
increased from 26,297 units in 2019 to 57,511 units in
2023, indicates an improvement in the business
environment in the region. The increase in the number
of enterprises and organizations increases the
attractiveness of the investment environment and
indicates the diversification of the economy. In
addition, the increase in the number of enterprises
indicates the competitiveness of markets in the region
and attracts investors. The increase in the number of
subscribers connected to the Internet from 1,505.9
thousand in 2019 to 2,706.1 thousand in 2023 will
accelerate the transition to a digital economy. The
expansion of digital infrastructure plays an important
role in leading the economy of Samarkand region on
the path of innovative development. The increase in
wages from 1,894.8 thousand soums in 2019 to 7,495.5
thousand soums in 2023 indicates an increased
demand for labor resources in the ICT sector. The
increase in the number of employees working in the ICT
sector from 1,603 people in 2019 to 2,538 people in
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International Journal of Management and Economics Fundamental (ISSN: 2771-2257)
2023 indicates increased attention to the sector.
CONCLUSION
This study assessed the investment attractiveness of
the Samarkand region, with a particular focus on the
impact of digital economy development. The analysis,
based on the Investment Performance Index (IPI) and a
range of economic, social, and technological indicators,
revealed that digitalization plays a crucial role in
enhancing the region’s investment potential.
Key findings indicate that regions with well-developed
digital infrastructure, high internet penetration, and a
strong ICT sector tend to attract more stable and long-
term investments. The study also highlights that an IPI
value above 1 reflects strong investor confidence, while
a lower value signals the need for policy improvements.
Factors such as economic instability, weak regulatory
frameworks, or insufficient digital infrastructure can
hinder investment growth.
➢
To enhance investment attractiveness, it is
recommended that policymakers and regional
authorities:
➢
Strengthen digital infrastructure by expanding
internet accessibility and supporting ICT-driven
enterprises.
➢
Enhance
investment
policies
through
regulatory improvements and incentive
mechanisms for investors.
➢
Promote
economic
diversification
by
integrating digital solutions into key sectors,
including agriculture, industry, and services.
➢
Ensure environmental and social sustainability,
as investor confidence is increasingly tied to
sustainable development practices.
Overall, digital transformation is a key driver of
investment attractiveness. By leveraging technological
advancements and fostering an innovation-driven
economy, the Samarkand region can position itself as a
competitive and sustainable investment destination in
Uzbekistan and beyond.
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