20.08.2021

Address by the President of the Republic of Uzbekistan Shavkat Mirziyoyev at the Meeting with Entrepreneurs of the Country in an Open Dialogue Format

 

Distinguished entrepreneurs, participants of the meeting!

First of all, I am glad to greet all of you, representatives of the business community of our country.

We have every reason to say that in recent years you have become the pillar and locomotive of the economy of Uzbekistan and the ongoing large-scale reforms.

In you, the entrepreneurs, business people – our compatriots, we see the creators of New Uzbekistan.

When it comes to this, it should be noted that the private sector accounts for 90% of the jobs created annually in the country. The fact that currently it employs more than 5 million people, mainly young people, proves its growing role not only in the economic, but also in the social life of the country. Taking this into account, if we want to ensure the further growth of our economy and social field, we must create all conditions for the development of entrepreneurship.

Over the past 3-4 years, the entrepreneurs were provided with many new opportunities, including in obtaining loans and subsidies, licensing, access to resources and real estate, and the development of export activities. The unnecessary verifications have been abolished, and most of the previous restrictions and barriers to access to cash, currency and raw materials have been removed.

Most importantly, the population and government agencies have changed their attitude to business, the profile and status of entrepreneurs in society is growing. This has contributed to the formation of a class of true entrepreneurs, firmly taken its place, having a reputation and their own brand in the domestic and foreign markets.

For example, such enterprises as «Chust Textile» (Ismatullaev brothers), «Art Soft Holding» (Bobokhonov brothers) in the Namangan Region, «Techno export» (Sherzod Kasimov) in Tashkent, «New Way Industries» (Sardor Abbaskhanov) in the Tashkent Region, «Oxalik Oltin Bog’i Mevasi» in the Samarkand Region, started their activities «from a scratch» and are currently exporting products for $10-15 million. It should be noted that each of them turned into a large company, creating more than a thousand permanent jobs.

It should be emphasized that there are many such highly efficient enterprises in every region. I would like to especially note that the enterprises «Dinar tekstil» (Khadiyatillo Tillaboev) in Andijan, «Bunyodkor» (Golib Erkulov) in Kashkadarya, «Sirdaryo mega lyuks» (Mukhiddin Normatov) in Syrdarya, «Fergana global textile» (Muminjon Razakov) , «Xorazm tex» (Alisher Sobirov) in Khorezm, «Sangzor-tekstil» (Otabek Khujametov) in Jizzakh, «Parvoz xumo ravnaq trans» (Shermukhammad Ochilov) in Bukhara, «Indenim klaster» (Sherzod Shoymardonov) in Surkhandarya, «Baht-Textile» (Bakhriddin Muminov) in Navoiy and others in a short time achieved an increase in production volumes, exports and the number of jobs to 10-15 times.

Such successful entrepreneurs as Kamol Abdullayev, Kutlimurat Panayev, Murtazo Rakhmatov, Ulugbek Sotiboldiyev, Ulugbek Tukhtaboyev, Murod Yokubov, Zafar Khoshimov, Shavkat Jamolov, Murod Nazarov, Mamasaidov brothers, Farrukh Fuzailov, Bakhtiyor Azizkhujayev, Farkhod Mamajanov. Bekzod Mamatkulov, Bakhtiyor Umarov are expanding their business across the country.

Dear participants of the meeting!

I am very glad to see hundreds of entrepreneurs among young people and women in this hall and in the local studios today.

Over the past 2 years, we have allocated $500 million only for the development of women’s and youth entrepreneurship. All conditions have been created so that they can start their own business, including mastering in-depth the necessary professions and entrepreneurial skills.

The hundreds of our compatriots, including Anna Dobrykh from Namangan, Nargiza Aminova from Margilan, Shakhlo Yuldasheva from Khorezm Region, Munira Kariyeva and Madina Ayupova from Tashkent, Nargiza Bekmuratova from Tashkent Region and Mukhabbat Kayumova from Surkhandarya Region became well-known businesswomen in the country.

Over the past 5 years, the number of young entrepreneurs in Uzbekistan has grown 5 times, currently there are more than 500 thousand.

Further expansion of the participation of women and youth in entrepreneurship, their full support will remain the priorities of our economic policy.

Dear friends!

For us, entrepreneurs who are always in search, strive for something new, committed to the cause are real, selfless patriots, loyal to their Motherland, and we deeply appreciate them.

I would like to wholeheartedly express my gratitude to entrepreneurs for the help provided to our people during the period of challenges and difficult trials caused by the pandemic – they not only kept their business, but also continue to create jobs, support those in need, increase production and exports.

As a sign of deep gratitude, for the first time I signed letters of appreciation on behalf of the President of the Republic of Uzbekistan to 100 such active and selfless entrepreneurs.

Fifty of them are present in this hall and fifty in regional studios.

Taking this opportunity, I once again express my sincere gratitude to these generous, energetic, sincerely loving entrepreneurs who love their country and people, and I hope that the number of such wonderful people will grow every day in our country.

Dear compatriots!

For the first time, we decided to meet with you in the format of an open dialogue to discuss in detail the problems of the business.

As you know, during the implementation of measures aimed at reducing poverty based on work in the context of makhallas (local residential community areas), we have identified important goals to identify growth points on the ground, reduce unemployment, increase incomes of the population. In this process, government agencies and all organizations providing services should work closely with entrepreneurs on a daily basis and provide them with practical assistance.

In preparation for today’s dialogue, due to the receipt of many questions and suggestions, we were forced to extend the deadline for receiving appeals for 10 days, August 1-10. More than 15 thousand questions, proposals and initiatives have been received from entrepreneurs, and decisions have already been made on most of them on the ground.

A systematic work was organized, especially in the Andijan, Namangan and Surkhandarya regions, as a result of which 90% of the issues of our entrepreneurs were resolved in a short time, which undoubtedly delights us.

Where a favorable environment has been formed, where the heads of regions and industries correctly understand the requirements of the President, the working methods and attitude towards entrepreneurs have also changed. At the same time, our people themselves will assess the activities of managers who do not live by the concerns of entrepreneurs, do not help and do not think into their problems. They have no place in our ranks, and they will continue to do so.

We should all understand clearly: the appeals of entrepreneurs are a reflection of the state of reforms. From this point of view, it is important that every head of a ministry or agency, the khokim (governor) of a region, district or city considers these appeals as an assessment of their activities, draws the right conclusions and radically changes their work in this direction.

Managers who are unable to take the initiative, who do not seek to put forward new ideas, who do not want to change, will be held mostly accountable, appropriate measures will be applied to them.

Dear business representatives!

I have carefully read the issues raised in your appeals. Therefore, I am fully aware of all the problems that concern you.

To date, we have systematized the most pressing of these problems and in order to solve them, we have developed a program of activities in 7 key areas, which today I want to discuss in detail with you.

First direction. Forty percent of your requests are related to business financing and lending. They mainly note high interest rates on loans, most of which are issued for short periods and on terms that are inconvenient for entrepreneurs.

For example, representatives of the company for the production of electrical products «Sam Elektro Servis» in the Urgut District reported that they received a loan of 2.5 billion Uzbek soums for a period of 3 years, but they need at least 5 years to make a profit.

Indeed, we must admit that the term of most loans for entrepreneurs does not exceed three years.

In addition, loans in foreign currency issued by banks to about 18 thousand entrepreneurs at 8-10% per annum lead to additional costs due to the constant growth of the exchange rate. More than a thousand appeals have been received on this occasion, which indicates that this is a serious issue that hinders the development of entrepreneurship. In this regard, it is necessary to take urgent measures to form a long-term resource base of commercial banks and acceptable interest rates on loans.

First, the additional opportunities will be created to increase the capitalization of banks. For this purpose, an additional $600 million will be allocated to banks from the Reconstruction and Development Fund on market conditions next year. These funds will be placed on a competitive basis in both public and private banks.

They will be received by banks that will present the best business plan, projects with the greatest impact and the number of jobs created.

Second, the banks themselves applying for the above funds will also attract at least 30% of additional resources from sources of external and internal financial markets. In particular, next year banks will place Eurobonds in the national currency on the international financial markets for a total of 5 trillion Uzbek soums.

We will also create ample opportunities for large foreign banks using modern technologies and ready to work in the Uzbek market. This, in turn, will create favorable conditions for our entrepreneurs, and as a result, a healthy competitive environment will be formed in the banking system, which is very important for us.

Everyone participating in today’s meeting, the head of the bank should ask himself the question: «What do I need to change in order to adequately meet the demands of the time and meet the needs of entrepreneurs against the background of increasing competition?» and draw serious conclusions.

Third, a system will be created in which banks, regardless of the currency of resources attracted from outside, will issue loans to business representatives in the national currency – Uzbek soums and at acceptable interest rates.

The questions about this were raised by hundreds of our entrepreneurs who received loans in foreign currency and found themselves in a difficult situation today. Therefore, a foreign exchange risk management company with branches in the regions will be formed under the Ministry of Finance. This company will create the necessary conditions for issuing loans in the domestic market only in the national currency, converting funds raised by banks in foreign currency.

In a word, an increase in the dollar or euro exchange rate from now on won’t create additional problems and won’t entail unnecessary costs for the entrepreneur. The company will work closely with all regions and industries.

Fourth, from now on, the practice of term limits on loans issued to banks at the expense of concessional funds raised by the government from international financial institutions will be discontinued.

The Deputy Prime Minister of the Republic of Uzbekistan, Minister of Economic Development and Poverty Reduction J.Kuchkarov, Minister of Finance T.Ishmetov, Chairman of the Central Bank M.Nurmuratov are personally responsible for resolving this issue.

Fifth, starting from October 1 of this year, loans in foreign currency received by about 6 thousand entrepreneurs in the amount of up to $1 million, a total of about $1 billion will be converted into the national currency by agreement between entrepreneurs and commercial banks.

Thanks to such mechanisms, commercial banks will additionally generate long-term resources on average in the amount of 30-40 trillion Uzbek soums annually. Due to this, entrepreneurs will be able to get loans in national currency for a long time and at least 5% lower than current rates.

I believe that these new opportunities will give a serious impetus to the development of entrepreneurship in our country.

Dear entrepreneurs!

Obviously, everyone would like to get a loan at a low rate. However, if we artificially lower interest rates, the balance in the monetary market will be disrupted. Therefore, when talking about «low-cost» loans for economic development, we should not forget about macroeconomic stability. If there is no stability, we will not be able to achieve our economic growth goals.

We will consistently continue to work to reduce the level of inflation, which directly affects interest rates, and put the process of bank lending on full-fledged market rails.

In order to work on the basis of modern market principles, banks create «project factories» and business training centers in the regions, attract foreign specialists. These centers will help entrepreneurs, especially young ones, to implement their ideas, develop business plans, raise funds, accompanying them throughout the business chain.

We plan to reduce the inflation rate to 10% this year and to 5% over the next two years. This will naturally reduce the rates and extend the terms of loans to the optimal level.

Sixth, about 2 thousand applications received related to family entrepreneurship, which occupies a special place in our reforms. From now on, those who want to start a family business will not beat the thresholds of khokimiyats (governors’ offices), banks or other agencies to get a loan, to puzzle over finding equipment suppliers.

The whole process - from loan processing to the purchase of raw materials and the sale of finished products - will now be carried out in electronic form online. This platform, in turn, will create a market of at least 10 trillion Uzbek soums for supplier enterprises. That is, suppliers will be able to directly sell manufactured equipment, raw materials and finished products.

The heads of the economic complex, Deputy Prime Minister J.Kuchkarov, Chairman of the Central Bank M.Nurmuratov, commercial banks should explain these innovations in detail to entrepreneurs and the local population within three months and organize their effective use. In this regard, it is necessary to widely disseminate the Andijan experience of organizing work in the context of makhallas (local residential community areas) throughout the country.

Seventh, in many appeals, entrepreneurs are asked to reduce and mitigate the requirements for the opening and operation of non-bank credit institutions in order to further increase the sources of business financing. This issue was raised, in particular, in the appeals of the head of the Andijan enterprise «Almaz Finans» Olimjon Okhunov and the head of the Jizzakh enterprise «Diamond-N Trade Capital» Sherzod Soatov.

We welcome these suggestions. Since October 1 of this year, the requirement for licensing microfinance organizations has been completely abolished. From now on, it is enough for them to enter the register of the Central Bank to start their activities.

In addition, they will no longer need the consent of the Central Bank to organize cash registers, open branches in the regions. The existing restrictions on microcredit (300 million Uzbek soums) and microleasing (600 million Uzbek soums) for entrepreneurs will also be lifted.

At the same time, microfinance organizations will be given the right to raise funds from other organizations and issue bonds. These organizations will also be entitled to accept payments on a par with banks.

In general, due to these new opportunities for our entrepreneurs, additional resources will appear on the credit market - 10 trillion Uzbek soums per year.

Second direction is the improvement of the tax system, the maximum reduction of the tax burden on business.

As it is known, over the past three years, the number of types of taxes has been reduced from 16 to 9.

Many may have forgotten that, until recently, pension, school and road funds were paid in 3,2% fees, which put a heavy burden on businesses. They were withheld from turnover regardless of the profit of the enterprises, their amount reached 20-25 % of the profit.

After the abolition of these fees to extra-budgetary funds, about 7 thousand enterprises were exempted from paying taxes annually on average 6 trillion Uzbek soums. For instance, the «Andijonkabel» enterprise will have 11 billion Uzbek soums, and the joint venture «Lactalis Agro» - 3 billion Uzbek soums.

The rates of property tax, income and social taxes have been reduced by half.

I will give specific examples: the tax burden in the transport sector has decreased by 3 times, in the food industry by 2 times, in the textile and electrical industries by 20%.

During the pandemic, despite a sharp increase in government spending, the value added tax was cut from 20 to 15%, the social tax for the hardest hit industries from 12 to 1%, and property and land taxes were completely phased out. This, in turn, allowed entrepreneurs to direct the freed up 2 trillion Uzbek soums to business development. However, entrepreneurs raise many more legitimate questions related to tax rates and tax administration.     

First, participants in 23 special economic zones are worried about whether their previous benefits will continue after the new Tax Code came into force last year. Such appeals were received from more than 70 enterprises operating in special economic zones, including from the joint venture «AWP» (Komil Mirzaev) in the Syrdarya region and the «Steel Pipe Company» (Azizkhon Khafizkhonov) in the Tashkent region.

On this issue, I would like to say unequivocally: the benefits provided to entrepreneurs registered in economic zones before the adoption in February 2020 of the Law on Special Economic Zones will remain. The law guarantees it. In particular, such entrepreneurs were exempted from property, land and water taxes for up to 10 years, depending on the amount of investment.

Now these benefits will be supplemented in terms of exemption from income tax, and about 300 billion Uzbek soums per year will remain at the disposal of enterprises. For example, if the «Temur Med Farm» enterprise in the «Sirdaryo» free economic zone paid income tax in the amount of 4 billion Uzbek soums for the first 6 months, then in the second half of the year the same amount will remain at its disposal. In order to ensure equal competition in the domestic market, raw materials imported for the production of export-oriented products will be exempted from customs duties on imports. For example, the «Jizzax Toshtepa Textile» enterprise in the «Jizzakh» free economic zone exports all of its products. Due to that privilege, for every $1 million of raw materials and semi-finished products imported by the enterprise, a customs privilege for 2.2 billion Uzbek soums will be provided.

However, one must be acutely aware of the following: we are carrying out big reforms in order to create an unbroken value-added tax chain. Thus, a procedure will be introduced for refunding overpaid value added tax to participants in special economic zones within 7 days. In a short time, this procedure will allow to return the amount of value added tax to entrepreneurs by an average of 350 billion Uzbek soums per year and thereby increase their working capital.

In addition, with a 120-day value added tax installment plan, imported goods will not be charged interest and will require collateral.

Second, big changes are taking place in the construction industry of the country.

From more than 50 manufacturers of building materials, such as «Shah-Polan M» in Tashkent, «Farg’ona Yasin Qurilish Mollari» in Fergana, proposals were submitted to reduce the cost of production. For instance, in the structure of the prime cost of cement, the tax for the use of subsoil is 14%, asphalt - 10%, sand and gravel mixture - 7%.

Therefore, the tax rate for the use of nonmetallic minerals, such as sand, gravel, limestone, gypsum, dolomite, will be reduced by 2 times. Due to this, about 1.5 thousand enterprises will have 500 billion Uzbek soums a year on their bank accounts. For example, the joint venture «Huaxin Cement Jizzakh» will be able to allocate an additional 27 billion Uzbek soums to further expand its activities.

Third, we pay special attention to the development of the service sector. This is one of those areas that allows to create new jobs within a short period time.

The pandemic continues, and indeed we all see how badly it affects the service sector, especially in catering facilities and tourism.

In this regard, more than 300 applications were received from public catering and tourism enterprises with a request to extend last year’s benefits. Taking this into account, by the end of the year, we will exempt 13 thousand public catering enterprises from paying land and property taxes. As a result, they will have an additional 30 billion Uzbek soums in their hands. At the same time, by the end of this year, the deadline for debt payment as well as a delay in repayment of loans on other taxes, which in total amounts to 35 billion Uzbek soums will be extended.

Along with this, I think you will agree with the proposal to exempt travel companies and hotels from tourist taxes for a period of 2 years. This will leave 150 billion Uzbek soums at the disposal of 2 thousand entrepreneurs, whose incomes have decreased in the current difficult situation.

Fourth, today about 5 thousand business entities have accounts receivable for foreign trade operations.

Due to the pandemic, the imposition of fines on these entrepreneurs and the collection of already imposed fines totaling 6 trillion Uzbek soums will be suspended until the end of the year.

Fifth, it is necessary to take serious measures to simplify tax administration and improve the control functions of tax authorities.

From January 1 of next year, the tax authorities through their electronic programs will launch a reporting service for business representatives.

Currently, 228 thousand small businesses do not have accountants. As a result, about 32 thousand entrepreneurs were fined for filing tax reports with deficiencies. The procedure for applying financial sanctions for late submission of reports will be completely canceled.

I am also concerned about the increase in the number and size of some of the fines imposed by the tax authorities. So, if last year, according to the results of desk audit, 336 enterprises were fined for 51 billion Uzbek soums, then in the first six months of this year, over 3 thousand entrepreneurs were fined for more than 900 billion Uzbek soums.

In this regard, Deputy Prime Minister J.Kuchkarov, Minister of Finance T.Ishmetov, Chairman of the State Tax Committee Sh.Kudbiev, Minister of Justice R.Davletov, Business Ombudsman D.Kasimovs are instructed to submit a proposal within a month to abolish the practice of imposing financial sanctions based on the results of an in-house audit of tax authorities.

Sixth, according to the current procedure, entrepreneurs, along with reporting on value added tax, are forced to separately apply to the tax authorities in order to return the difference in VAT. This directly affects the activities of 14 thousand entrepreneurs, makes them waste time and effort.

Seventh, the head of the «SAG Agro» enterprise Kamol Abdullayev, and more than 200 other entrepreneurs asked to consider the possibility of offsetting the value added tax paid to the tax and customs authorities.

For example, the «SAG Agro» enterprise, having an advance payment of 700 million Uzbek soums on its balance sheet, had to pay an additional 1,4 billion Uzbek soums to the customs. Therefore, from the next year, the electronic databases of the tax and customs services will be integrated with each other for calculating VAT. That is, excess payments to the tax authorities for value added tax will be taken into account when paying customs duties. More than 10 thousand entrepreneurs will be able to take advantage of this privilege.

Third direction. Allocation of land plots remains one of the biggest problems for entrepreneurs; more than 4 thousand applications have been received on this issue.

This year we have launched major reforms in this direction. Yesterday, I signed the relevant law adopted by the chambers of the Oliy Majlis (the National Parliament). The adoption of this document was, without exaggeration, an important step in the implementation of historical reforms in our country. Leaders of industries and regions, entrepreneurs, citizens must deeply understand its essence.

First, a solid legal basis has been created for putting land into an economic circulation, turning it into an object of sale and purchase and mortgage.

Second, we have divided all land into two categories: agricultural and non-agricultural.

Agricultural lands are our invaluable national wealth, they are the basis of the country’s food security, an integral part of the life of ordinary villagers. Therefore, these lands will be provided only for lease on the basis of an open tender. The competition for each land plot will be held in order to find a fair answer to the question: «Who deserves more right to use the land?».

Everyone - peasants, farmers, agricultural firms and clusters - will participate in this competition on equal terms.

Third, non-agricultural land will be sold only through an auction.

Over the past year and a half, we have accumulated enough experience in the open and transparent sale of land through auctions. However, in most cases the analysis shows that land plots were put up for auction in areas inconvenient for an entrepreneur in remote areas without infrastructure.

It’s not a secret for anyone that «good» land plots were transferred directly according to different schemes and based on the decision of the khokim (governor).

From now on, land areas will be sold as private property or leased only following open tenders through an auction.

Many people ask quite a natural question: «What difference does it make whether the land will be sold as private property or not?» Since then, 3-4 generations have changed as private ownership of land was abolished in our country.

We must clearly understand: through the privatization of land, it will not be more or less, but its market value will emerge. The person who owns the land will become the real owner, the owner of capital.

Fourth, many entrepreneurs are concerned about the future fate of the lands where their facilities are located. The land areas currently occupied by these enterprises by the right of ownership, use or lease will be registered in ownership. That is, no one can buy this land plot, only its owner will have the right to privatize. At the same time, the site will be privatized by the enterprise on favorable terms depending on its type and location.

In the future, entrepreneurs will be able to use land as a highly liquid asset and collateral.

I think that these innovations will be the restoration of the historical justice that our entrepreneurs have been waiting for many years.

Fifth, from now on we will sell objects of state property through an auction together with the land on which they are located, as a single property complex.

Entrepreneurs buying the building will also own the adjacent land as private property.

In addition to the approved program, by the end of the year another 500 state objects will be put up for open tenders.

Taking this opportunity, I urge our esteemed entrepreneurs to take an active part in the auction.

Sixth, before putting up new land plots for auction, it is necessary to draw up a clear plan for the development of the region.

When we studied the experience of many developed countries, we saw that none of them is allowed to transfer land without such plans.

Primarily, a specific area is selected and a «master plan» is developed.

It clearly defines where housing,  school and production will be located, a scheme for the construction of infrastructure will be developed. Only after that plots are put up for sale for a specific project.

The khokims (governors) of the regions, together with the departments for cadastre and architecture, using this experience should organize the work, specifically determine the territory, approve the plan, and only then put the land plot up for auction.

In addition, special funds will be created in each region, and the proceeds from the sale of land will remain entirely at the disposal of districts and cities, and will be directed to the construction and development of infrastructure for entrepreneurs.

Deputy Prime Minister J.Kuchkarov is instructed, together with the khokims of the regions and the economic complex, to realize by November 1 of this year at least a thousand land areas in each region. Apart from this, at least 200 land plots along the main roads for specific projects will be auctioned in each region.

Fourth direction.  About 3 thousand entrepreneurs raised the issue of access to the infrastructure necessary for doing business.

For example, in the Syrdarya region, the «Gulistan Gold Yarn» enterprise (Sherzod Toshpulatov) has been unable to connect to the power grid for a long time, although it has all the necessary production equipment, as well as a transformer purchased at its own expense.  The company is ready to create 600 permanent jobs.  He only needs access to the power grid.

Many similar appeals were received from the Republic of Karakalpakstan, Kashkadarya, Jizzakh and Ferghana regions.  Therefore, first, from January 1 of next year, the state will fully undertake the supply of power grids, gas pipelines, water supply and road infrastructure to projects worth 200 billion Uzbek soums.  So far, this privilege applies only to projects of foreign investors worth more than $50 million.

Second, in the next 2 years, 200 additional industrial zones will be created throughout the country.  In each of them, it is planned to organize the activities of at least 15 enterprises, and the state will also be fully responsible for providing them with electricity, natural gas, water and road infrastructure.  For these purposes, next year, 2 trillion Uzbek soums will be allocated from the state budget.

Deputy Prime Ministers J.Kuchkarov, S.Umurzakov, together with the khokims (governors) of the regions, until November 1 this year, to prepare specific proposals for the deployment of industrial zones and the implementation of specific projects in them.

These measures will create significant opportunities for certain regions of the Surkhandarya, Bukhara, Khorezm, Syrdarya, Kashkadarya, Samarkand and Tashkent regions, where the share of industry is low in the economy.

 Third, today most entrepreneurs are worried about interruptions in the supply of electricity.

On this issue, separate programs are being implemented in the context of each district, city and makhalla (local residential community area).  So, by November 1 of this year, work is being completed on replacing 4 thousand transformers, updating 35 thousand substations and 15 thousand kilometers of power transmission lines.  This year, for the first time, 3 trillion soums have been allocated for these works.  By the way, over the past years, even 10% of this volume of work has not been completed.

Comparative analysis shows that over the past 5 years, the number of entrepreneurs who consume electricity has increased by 25%, the volume of their consumption - by 30%.  In this regard, in order to significantly increase the production of electricity, for the first time in our history, foreign direct investment and the private sector were attracted in this area.  As a result, by the end of the year, 8 thermal and solar power plants with a total capacity of 1,800 MW will be launched entirely at the expense of private investments.

The Ministry of Energy needs to increase the number of such projects in the coming years and by 2023 introduce additional power generation capacities of up to 4,400 MW.

Fourth, justified criticism from entrepreneurs cause difficulties in connecting to power grids, long terms and high connection costs.  Therefore, 75% of all consumers are small plants, catering and trade enterprises that consume up to 20 kW/h of electricity.  However, the same requirements apply to them as to large enterprises.

For example, to connect a small retail outlet to the power grid, you need to go through 4 stages, while the expense will be 7 million Uzbek soums and it will take at least one month.

Starting from the new year, the Ministry of Energy will introduce a new system that is more convenient for consumers. Connection to electricity networks will be completely transferred to an electronic platform, all connection procedures will be carried out in one stage.

A 10-day period is established for connecting entrepreneurs to electric power grids with a consumption power of up to 20 kW, 20 days – 50 kW.

If the electric grid enterprises do not complete this work within the specified timeframe, they will pay compensation to entrepreneurs.  This process will be organized through the centers of public services and taken under constant control.

 We will assign the responsibility for providing entrepreneurs with energy resources in the required volume to the Ministry of Energy and fix this at the legislative level.

 Fifth direction.  The reforms that we have begun to support exporting enterprises, as well as the widespread involvement of small businesses in export activities, will consistently continue.

First, last year, during the pandemic, the procedure for refunding value added tax to enterprises in the textile industry showed its effectiveness in practice, without waiting for foreign exchange earnings from exports.

About 2 trillion Uzbek soums were returned to 482 enterprises.  This innovation is also applied for the first time in our recent history.  From October 1 of this year, a similar procedure will be established in relation to other conscientious working and responsible exporters in all industries.

Second, the main problem of most exporting enterprises is the lack of working capital.  This question is contained in the appeals of more than 300 entrepreneurs.

In this regard, the Export Support Fund was established last year, and mechanisms for financing exports in the amount of up to $1 million were established.  This system was effectively used by 200 enterprises, which exported an additional $210 million of products.  Now, such opportunities will be significantly expanded, enterprises whose export exceeds $20 million a year will be provided with soft loans of up to $5 million.

Third, many entrepreneurs expressed dissatisfaction with the current requirement to obtain a national certificate when importing certified equipment and raw materials from countries with an advanced quality control system – the European Union, the USA, Japan, and South Korea.  For example, it takes 2-3 million Uzbek soums and 5-10 days to obtain a certificate for equipment and raw materials.

The government commission headed by Deputy Prime Minister S.Umurzakov is instructed within a month to form a list of such states, to submit a draft resolution on the termination of the practice of obtaining a national certificate for equipment and raw materials that already have certificates of these states.

Fourth, certainly you all are informed about reducing the customs duties in order to increase competitiveness and reduce the cost of industrial products.

At the same time, such enterprises as «Milk Euro Food» (Tashkent Region), «SDK Group And» (Andijan Region) and «Wooll Teks Inter» (Tashkent) noted an excess of the customs duty rate for imported raw materials relative to finished products.  That is, the import of certain types of products from abroad is cheaper for our entrepreneurs than their production.

The government commission under the leadership of the Deputy Prime Minister S. Umurzakov, within a month, to submit a draft resolution on reducing the rates of customs duties on the import of raw materials and semi-finished products.

Sixth direction.  Certainly, you clearly understand the importance of transport and logistics issues in ensuring the competitiveness of our products and their promotion to new markets, establishing trade and cooperation ties between regions in general.

In this direction, we have created a system for the development of transport corridors, simplification and digitalization of the movement of goods through customs, and partial reimbursement of transport costs.  Through this system, over 3 thousand exporters have been provided with financial assistance in the amount of 200 billion Uzbek soums since the beginning of the year, which made it possible to export products worth about $800 million.  These enterprises will continue to work systematically to bring the export volume to $2 billion by the end of this year.

To this end, first, when importing trucks, due to the provision of customs privileges by us 2 years ago, road freight transportation became 2 times cheaper, the volume of cargo increased by 1.5 times.  However, the term of this privilege ends in 4 months, and more than 40% of entrepreneurs proposed to extend the term of these customs privileges.  In this regard, a recent presidential decree was signed to extend them for another 3 years.

Second, the heads of the enterprises «Polvontosh» (Surkhandarya Region), «Afrosiyob Parranda» (Samarkand Region) drew attention to the large difference between the tariffs operating on the routes of internal and external railway communication, the high cost of international transportation.

In this regard, the Ministry of Transport, along with the Ministry of Finance and the Antimonopoly Committee, must revise railway tariffs within two months.  For entrepreneurs, the current import tariffs for raw materials not produced in the country should be reduced at least by 25%.

From January 1 next year, the Ministry of Transport will publish data on the cost and price structure of each service.

Third, the railway sector in the next 5 years needs more than 7 thousand additional freight cars.  This problem can be solved not at the state level, but solely through the involvement of the private sector, as in the production of electricity or cement.

Therefore, next year, the activities of private logistics operators will be established, having at their disposal wagons and containers, the tariffs will be divided into two parts.  The state will only regulate issues related to railway infrastructure and locomotive services, and the provision of freight cars will be carried out on the basis of market principles.  In this regard, the benefits for private entrepreneurs when importing railway cars are extended until January 1, 2025.

Seventh direction.  We will resolutely continue our policy of reducing interference in business activities, simplifying procedures, and ensuring the inviolability of private property.

First, the process of obtaining subsidies provided for entrepreneurs is currently extremely complicated.

For the purpose of state support for entrepreneurs, more than 80 types of subsidies have been introduced.  Over the past period, they have been allocated 2.3 trillion Uzbek soums.  However, in more than 10 areas, such as preschool education, public education, alternative energy, fish farming, poultry farming, karakul farming, subsidies do not work.

This issue was also raised by the head of the Ferghana private kindergarten «Yulduzchalar ziyosi» Ziyoda Kosimova.  The reason, in her opinion, is the complicated procedure for paying subsidies and the lack of digitalization.  To receive a subsidy, an entrepreneur must submit an average of 5 documents and receive the opinions of 10 ministries and agencies.  This takes at least a month.

In addition, 60% of livestock breeders find it difficult to get subsidies.  Therefore, from January 1 of next year, applications for the allocation of subsidies will be accepted through a «one stop shop», the number of government agencies involved in this process will be reduced by 2-3 times.

Second, last year we canceled 114 out of more than 400 business licenses and permits.  In addition, a notification procedure has been introduced for 33 types of activities for which licenses and permits are required.  Currently, 30 types of licenses and permits are issued online.

Starting next year, all permits for starting a business will be processed online.  By the end of this year, the number of required licenses or permits will be reduced by another 30%.

Third, the head of the «Wang Da Group» joint venture in the Syrdarya Region, Guzal Tojimirzayeva, and more than 30 other entrepreneurs in the field of metallurgy are asking for permission to use induction furnaces.  From November 1 of this year, restrictions on the use of modern induction furnaces that meet all technical requirements will be lifted.  At the same time, special attention will be paid to such issues as ensuring the quality of products, full compliance of production with uniform standards and safety requirements.

Fourth, in the course of any inspection, monitoring of the activities of entrepreneurs, carrying out control measures, the principles of justice and the rule of law must be observed.  For this, the Chamber of Commerce and Industry will be empowered to participate in all inspections with the consent of the entrepreneur and establish effective public control.

Fifth, today local khokimiyats (governors’ offices) owe 123 billion Uzbek soums to 349 entrepreneurs in connection with the demolition of buildings and structures.

I warn the khokims (governors) of all regions: by September 1 of this year, all calculations with entrepreneurs should be completed, there should not be a single amount of debt left.

Dear participants of the meeting!

Relevant decisions will be made in the near future on all initiatives, appeals, proposals concerning specific problems voiced today.

Today I am ready to listen and discuss any of your opinions, suggestions and questions.

Dear entrepreneurs, representatives of the business community!

For the coming years, we have set ourselves ambitious tasks for the further growth and development of the national economy.  In solving them, we undoubtedly rely on our multinational people, including you, our brave and worthy entrepreneurs.

In such an important historical process as the building of New Uzbekistan, you have assumed great responsibility, your active participation in the implementation of reforms is growing, which undoubtedly pleases all of us.

In this regard, I would like to note the following.

First, today, in a period of intensifying competition, along with the formation of comprehensive conditions for small businesses, we are in favor of the further development of medium and large businesses.

For this reason, we are ready to create all opportunities for our entrepreneurs to improve their knowledge and skills in business management, and to widely develop innovations.

Second, it is necessary to introduce modern technologies into production, carry out new investment projects, expand the range and improve the quality of products, and use the existing capacities more efficiently.

We must use all our capabilities and resources for the development of a system of clusters and cooperation in the metallurgical and gas chemical industries, in such agricultural sectors as food production, horticulture, fish farming, and animal husbandry.

Third, we must increase the volume and expand the geography of exports by increasing the production of import-substituting and export-oriented products.

Fourth, the private sector is called upon to become an active participant and a leading force in the expansion of the types of modern services, the organization of outsourced services in areas such as IT, healthcare, education and others.

Fifth, business representatives need to use every opportunity to ensure that their personnel receive the most modern education.

On the basis of advanced approaches, in direct connection with practice, it is necessary to deeply revise the directions of education in universities in entrepreneurship and business management, curricula and teaching methods.

It is advisable that well-known, experienced entrepreneurs of the country conduct motivational lessons and master classes in schools, professional centers, universities, create their own schools and training centers.  A similar positive experience, for example, was accumulated by the Khasan and Khusan Mamasaidov brothers.  The state will definitely provide subsidies and preferences for this. As well as among artists, scientists, athletes, doctors, glorious dynasties and our entrepreneurs will appear.

I am assured that there will be many such dynasties in New Uzbekistan and I am ready to fully support them.

Sixth, an urgent task is to create conditions for as many conscientious and disciplined taxpayers as possible, this is the best way to fight the shadow economy.

Starting this year, the book «Yilning Ilg’or Tadbirkorlari» («The Leading Entrepreneurs of the Year») will be published about business representatives who serve as an example for all of us in creating jobs, introducing innovations, paying taxes on time, exporting, and training highly qualified specialists. We will also institute government awards to adequately evaluate and motivate such business people. From now on, the entrepreneurs of the country will have their own orders and medals.

 Dear compatriots, representatives of the business community!

I believe that our open dialogue today has been very useful for all of us.

Together with you, we have found practical solutions to many issues and problems.  Most importantly, our respect and trust to each other has grown even more.  Based on what topical issues you raised, what specific proposals you made for their solution, we all see how the knowledge and level of our entrepreneurs have increased, and the worldview has changed.  Today you are using completely different working methods, innovative approaches.

And I am glad about that.

Considering our positive experience today, how do you look at holding such meetings annually, and they would become a good tradition?

In this regard, I propose to declare August 20 in our country as the Day of Entrepreneurs and celebrate it widely every year.  I think you will all approve of this initiative.

Thank you for your support!

Henceforth, on this very day, an open dialogue between the President and representatives of the business community will be held annually.  We will sum up the results of our work over the past year and in a solemn spirit will present state awards to the most advanced business representatives.

Dear entrepreneurs!

I am convinced that the new tradition that we started today will become an effective system for entrepreneurship throughout the year.  Responsible for it are the People’s Receptions and Receptions of the Prime Minister, the Chamber of Commerce and Industry, the Business Ombudsman, and in the regions – khokims (governors).  The newly formed Agency for Strategic Development, together with the above-mentioned departments, will systematize the problems of concern to entrepreneurs and investors, and develop specific proposals for their solution and submit them to the government and the President.

The Deputy Prime Ministers, heads of ministries and agencies, khokims will travel to the regions every week, on the basis of previously drawn up schedules, to meet directly with entrepreneurs and help solve their problems.

I repeat: we will always support selfless and proactive entrepreneurs, loyal to the Motherland, who know their business, who create decent working conditions for our people and earn income.

This is precisely the requirement of the President, the essence and meaning of the reforms we are implementing.

If all of us work in accordance with this requirement, then, undoubtedly, we will be able to bring entrepreneurship in the country to a qualitatively new, higher level.

I am confident of this and I urge all of you to unite in the name of achieving our great goals.

Dear compatriots!

Taking this opportunity, I sincerely congratulate you on the upcoming holiday - the 30th anniversary of the Independence of the Republic of Uzbekistan. I wish all of you a sound health, happiness and prosperity.

May success always accompany you in your noble and tireless efforts on the path to the prosperity of our beautiful Motherland!

Thank you for your attention!

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