Supporting private enterprises in Uzbekistan : challenges and opportunities

This report explores the constraints and opportunities facing the development of the private sector in Uzbekistan and presents a strategy for A.I.D. response. Part 1 examines the national context for small enterprise development, covering: the economy in general; the policy and regulatory framework; credit and financial services for small firms; privatization and private enterprise; institutional support for private businesses; and small-scale agribusinesses. Part 2 presents a framework for A.I.D. support and suggests assistance programs for both the short and long terms. According to the report, Uzbekistan faces three major constraints to developing a market economy: (1) a lack of individual expertise within government, business, and industry concerning the operations of a market economy and the role of government and small business in that system; (2) the continuing need of most small businesses for government-supplied inputs at subsidized prices; and (3) a lack of policies and institutional structures required to promote and sustain a dynamic private sector. In this context, A.I.D. can contribute most effectively by helping Uzbekistan to develop a positive climate -- legal, regulatory, attitudinal, and institutional -- for private enterprise, rather than directly assisting individual firms.