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THE ROLE OF SPECIAL ECONOMIC ZONES IN INVESTMENT
ATTRACTIVENESS
Tulaganova Rukhshona Farrukh qizi
Student of Tashkent State University of Economics, Tashkent, Uzbekistan
Email: rukhshonatulyaganova@gmail.com
https://doi.org/10.5281/zenodo.11542071
All-round development of the country, including the stable growth of its
macroeconomic and microeconomic indicators, the increase of the share of
exports in the balance of goods together with the saturation of the market, the
increase in the level of well-being of the population, the country's appearance
among the powerful countries in the world. The special economic zones
established in the country contribute to the increase in the volume of
investments attracted to the country and its comprehensive development.
A special economic zone is an area with defined boundaries and a special
legal regime, specially allocated for the purpose of attracting foreign
investments and local investments, high technologies and management
experience for the rapid socio-economic development of the respective area.
Special economic zones can be organized as follows:
• free economic zones;
• special scientific and technological zones;
• touristic and recreational zones;
• free trade zones;
• special industrial zones.
SEZs have several advantages in attracting investors. SEZs often offer
various benefits to domestic and foreign investors, such as tax breaks, reduced
tariffs, and simplified regulatory processes. These benefits reduce the cost of
doing business and increase profitability, making the country more attractive to
investors. SEZs are usually established with excellent infrastructure, including
transport, utility and communication networks. This well-developed
infrastructure reduces operational difficulties and increases the efficiency of
businesses operating in the area. It should be noted that SEZs are usually
intended for export-oriented production. SEZs create a favorable environment
for production and export, helping enterprises to expand their market presence
and generate foreign exchange for the country. Furthermore, SEZs often create
many employment opportunities both directly within the regions and indirectly
through supporting networks. This employment growth can improve the local
economy and increase consumer spending, creating a virtuous cycle of economic
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growth. Foreign Direct Investment (FDI): SEZs can attract significant foreign
direct investment by offering a business-friendly environment. The increase in
direct investment brings not only capital, but also technology transfer,
managerial expertise and access to global markets.
In addition, SEZs help diversify the country's economic base by promoting
the development of new industries in the country and reducing dependence on
traditional industries. Such diversification can increase economic stability.
Another noteworthy aspect of SEZs is that concentration of enterprises in SEZs
can increase innovation and competitiveness. Companies benefit from proximity
to suppliers, customers and competitors, which leads to increased productivity
and innovation through collaboration and competition. SEZs can serve as a
testing ground for broader economic reforms. Successful policies implemented
in SEZs can then be replicated in the rest of the country, leading to overall
economic improvement. Global integration: SEZs help integrate a country into
the global economy by facilitating trade and investment ties. Such integration
can lead to the growth of exports, saturation of the national market with quality
goods, and more stable economic growth and development.
A number of works are being carried out in our country to establish SEZs in
our country, to give many benefits and preferences to entrepreneurs and
investors operating in them, with understanding of the national development of
SEZs, especially their role in investment attractiveness. The adoption of the Law
No. 604 of the Republic of Uzbekistan "On Special Economic Zones" in our
republic on February 17, 2020, many state regulations in the field of organizing
the operation of special economic zones and their development it is noteworthy
that reforms are being carried out. According to it, the development of the
special economic zone is carried out in accordance with the program, which
includes:
-
creation of production infrastructure;
-
to provide engineering-communication and road transport infrastructure
development programs;
-
creation of market infrastructure;
-
a complex of measures to attract foreign investments and local
investments in accordance with the activity and sectoral specialization of the
special economic zone.
Financial support of the development program of the special economic zone
is carried out at the expense of the zone's own resources, private sources, funds
of the State budget of the Republic of Uzbekistan, international financial
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institutions and foreign government financial organizations, as well as other
sources not prohibited by law.
In the formation of the state investment programs of the Republic of
Uzbekistan, the financial support of the engineering-communication and road
transport infrastructure development programs of the special economic zones
should be provided.
According to the Statistics Agency under the President of the Republic of
Uzbekistan, as of October 1, 2023, there are 819 economic zones in the Republic
of Uzbekistan, and 5196 enterprises and organizations operate in them. Among
them there are: 22 special (free) economic zones, 323 small industrial zones, 24
technological parks and 450 clusters. and the number of enterprises and
organizations within them was 752 in SEZ, 2488 in KSZ, 1501 in expoparks and
455 in clusters. There are significant differences in the number of SEZs
operating in our country across regions (Figure 1).
It is worth noting that the SEZs of our country have enterprises operating in
various fields and industries. This plays a very important role in the
diversification of our country's economy. The types of products produced by
SEZs and their industrial enterprises in our country are as follows: production of
motor vehicles, trailers and semi-trailers - 26.4%, production of food products -
17.4%, metallurgical industry - 15.2%, production of rubber and plastic
products - 9%, production of chemical products - 5.1%, production of textile
products - 4.8%, production of other non-metallic mineral products - 4.6%,
computers, electronic and optical products production - 4.4%, production of
finished metal products excluding machines and equipment - 3.4%, and
production of other types of industrial products - 9.7%.
Figure 1. The number of SEZs in the Republic of Uzbekistan, by regions
0
1
2
3
4
Republic of Karakalpakstan
Andijan
Bukhara
Jizzakh
Kashkadarya
Navoi
Namangan
Samarkand
Surkhandarya
Syr Darya
Tashkent region
Ferghana
Khorezm
Tashkent city
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During 2023, the total production volume of industrial products in our
country is 55229.9 billion. amounted to 27,545.6 billion soums. products
produced in SEZ made up soums. Taking into account the importance of SEZs in
the country's economy and development, the economic and social interests of
the population, it is necessary to further improve the system of SEZs, their
activities and the privileges granted to them in Uzbekistan.
List of used literature:
1. Law of the Republic of Uzbekistan dated February 17, 2020 " On Special
Economic Zones" № 604.
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