Outlook for 2011-12

• The Economist Intelligence Unit expects that the president, Islam Karimov, will retain a tight grip on power. Despite ostensible moves to give parliament a greater say, there is little prospect of democratisation.
• Mr Karimov's health is subject to question, and there are doubts over who will eventually succeed him, making for a highly uncertain outlook once he departs the political scene.
• Political links with the West will be closer over the forecast period than in the late 2000s, driven by the regional security agenda. However, political and economic ties with Russia and China will also remain strong.
• Real GDP growth will remain robust in 2011-12, owing to a solid performance in the Russian economy and broadly favourable export prices. We forecast officially reported annual average real GDP growth of just over 8.5%.
• Average annual inflation is forecast to remain high in 2011-12, at around 15%, owing to high global commodity prices. Government increases to state-sector wages and welfare benefits will lead to rapid money supply growth.
• The current-account surplus will reach 16% of GDP in 2011, before falling in 2012 as global prices for Uzbek commodity exports decline.

Monthly review

• In the first official pronouncement on the wave of unrest in the Middle East and North Africa (MENA), Mr Karimov claimed that the unrest is the result of foreign influences attempting to gain control of natural resources.
• A prominent political prisoner, Yusuf Jumaev, has been released from jail early and allowed to leave for the US.
• The black-market exchange rate has fallen by about 9% since October 2010 and is more than 40% below the official rate.
• The government is in dispute with the UK-owned Oxus Gold over a 50% stake in Amantaytau Goldfields (AGF).
• Despite a global climate of high food and commodity prices, official data report that inflation slowed in the first quarter of 2011, to 7%, from 7.3% in the previous quarter and 7.7% in the year-earlier period.
• Official statistics put exports of energy and fuel products at US$708m in the first quarter of 2011, still accounting for one-fifth of total exports, but falling by 10% in value terms compared with year-earlier period.
• Natural gas extraction was 16.7bn cu metres in the first quarter, a decline of 4.1% year on year. Output of liquids (oil and gas condensate) was 900,000 tonnes, a fall of 7.9% year on year, following a drop in output of 17.8% in 2010.

The president, Islam Karimov, dominates the political scene, and there is little prospect of democratisation over the forecast period. Mr Karimov, who was last elected for a seven-year term in December 2007, is expected to maintain a firm grip on power, as there seems to be no co-ordinated opposition to his rule from within the political hierarchy. Furthermore, years of repression have prevented the emergence of an opposition figure capable of challenging him successfully. Most of his opponents are living in exile. The centralisation of power in the person of Mr Karimov makes for a highly uncertain outlook once he eventually departs the political scene. Doubts over the 73-year-old leader's health add to the uncertainty.

The risks to stability in 2011-12 are compounded by the possibility of terrorist attacks and of social unrest. Although the main terrorist threat against the country-the Islamic Movement of Uzbekistan (IMU), which has been increasingly operating in Afghanistan and Tajikistan-has suffered setbacks in recent months, it retains an ability to operate in the region, and Uzbekistan is at high risk of a terrorist attack. The government is therefore likely to step up its co-operation with international anti-terrorism efforts. With regard to social unrest, the Economist Intelligence Unit does not perceive any immediate risk that the recent popular uprisings in the Middle East and North Africa (MENA) could directly spill over into Uzbekistan. Moreover, the authorities would act swiftly, and with force if necessary, to quell protests. However, if other authoritarian regimes in the Commonwealth of Independent States (CIS) were to be toppled-which cannot be ruled out, with Azerbaijan appearing the most vulnerable-the Uzbek regime could be at risk, as the demonstration effect of such an uprising in its immediate neighbourhood would be much stronger. A speech by Mr Karimov in May, in which he blamed the MENA unrest on foreign influences, indicated the authorities' concern about the risk of protest spreading to Uzbekistan.

Genuine opposition parties were impeded from taking part in the parliamentary election in December 2009. Consequently, given the lack of legitimate avenues of protest or opposition, spontaneous popular unrest, sparked by social and economic grievances, could increase. The occurrence of such violent unrest as seen in the Kyrgyz Republic in mid-2010 is unlikely in Uzbekistan, as the response of the security forces to any public upheaval would be much harsher. The authorities have also been keen to play down any hint of popular anti-Kyrgyz sentiment that might give rise to inter-ethnic violence.

Mr Karimov was last elected in December 2007, and the next presidential election is not due until 2014. A parliamentary election will also be held in that year, although parliament is at best a rubber-stamp body and no opposition parties were allowed to stand for the most recent election, in December 2009. We do not expect any moves towards democratisation over the medium term. The next elections will also be heavily controlled by the authorities, and voters will not be given a meaningful choice. The more significant issue is therefore whether Mr Karimov will remain in office and stand again in 2014. This is a conceivable outcome, if his health permits, and he would be certain to win re-election under such a scenario. However, in view of his advancing age, he is more likely to attempt an orderly handover of power to a trusted successor, whether in 2014 or earlier. Recent moves to amend the constitution, which would make the leader of the Senate (the upper house of parliament) president in the event of the current president's incapacity, could indicate that Mr Karimov is becoming more concerned about the succession, as he appoints the leader of the Senate. If Mr Karimov's health were to start to deteriorate, it is likely that he would speed up the succession process. Were he to die in office without having agreed a succession plan with other members of the elite, this could result in a destabilising power struggle. This could lead to prolonged political upheaval within the country, including mass social unrest, if the authorities were perceived to be temporarily weakened. We view a "palace coup"-whereby other members of the elite forcibly remove Mr Karimov from office-as a less likely scenario. Mr Karimov has so far successfully managed to limit the power of potential rivals, and we expect him to maintain a tight grip over the forecast period.

Relations with the US and the EU had improved in recent years, driven by anti-terrorist initiatives, the regional security agenda, and the desire of some EU states to look for alternative energy sources in Central Asia in order to reduce their reliance on Russia. However, recent statements from Uzbek officials suggest that Uzbekistan will try to seek alliances with countries, such as China, that are less concerned with its poor human rights record. The US is becoming a more prominent partner in anti-terrorism measures, following an agreement in 2009 to allow US non-munitions supplies to Afghanistan to cross Uzbek territory. Relations with Russia will occasionally be troubled, largely because of Russia's desire to increase its military presence in the region (Russia has mooted plans to build a second military base in the Kyrgyz Republic, close to the border with Uzbekistan).

Ties with Uzbekistan's neighbours in Central Asia will occasionally be tense. The unrest in 2010 in the Kyrgyz Republic caused Uzbekistan to close its borders with that country temporarily, and relations will remain strained because of border demarcation disputes, as well as ethnic tensions within the two countries' populations. Ongoing disputes over water and energy supplies will also exacerbate tensions between Uzbekistan and its neighbours. Depending on how the security situation develops in Afghanistan (and, increasingly, in Tajikistan), there is a risk that insurgents in those countries-among them significant numbers of ethnic Uzbeks-could expand their activities into Uzbekistan.

Over the forecast period the government will continue to support growth by expanding public investment into infrastructure and industry, and by increasing public-sector wages and social payments. The IMF has repeatedly called for greater progress in developing the banking system, liberalising the trade and payments systems, and adopting a more flexible exchange-rate policy. Given the government's record, we remain sceptical that significant progress on these issues will occur.

Large trade surpluses, supported by increased prices for Uzbek commodity exports, have enabled the government to avoid deeper reforms. Ample revenue from commodity exports will continue to limit the incentive for undertaking far-reaching economic reforms. Russia, China and some Middle Eastern countries have shown increasing interest in investing in sectors such as hydrocarbons. However, the poor business environment will continue to deter most Western investors, with the authorities likely to retain a plethora of regulations on private-sector activity, including currency controls and high tariffs on imports.

Uzbekistan's fiscal position is difficult to assess because of the high degree of opacity in the limited data available. Preliminary official data report a budget surplus of 0.3% of GDP in 2010. Revenue performance has improved in recent years as a result of strong economic growth, high commodity prices and reforms to ease the tax burden. GDP expansion will support revenue growth over the forecast period. A reduction of 1 percentage point in the rates of profit tax and personal income tax from 2011 onwards will help to sustain economic growth and encourage further activity to move out of the shadow economy. However, social spending will continue to rise strongly, and expenditure on defence and internal security measures will remain high. We forecast that the consolidated budget will record small deficits in 2011-12, equal to 0.2-0.3% of GDP. To support infrastructure development and investment in basic industries, the government will also draw on the Fund for Reconstruction and Development (FRD), which is financed by energy export revenue. According to Mr Karimov, the FRD held around US$3.7bn (equal to 11% of GDP) at end-2009.

Export-related foreign-exchange inflows, combined with large increases in public-sector wages and benefits, have maintained inflationary pressures. The money supply is forecast to grow rapidly in 2011-12 (albeit at a slower pace than in 2005-07), reflecting our expectation that prices for Uzbek gas and gold exports will remain high relative to their historical levels. In the past the IMF has recommended that the Central Bank of Uzbekistan consider targeting a moderate nominal appreciation of the currency to control inflation and to reduce reliance on indirect monetary policy tools. By contrast, the authorities will continue to prefer to allow the som to depreciate in nominal terms, in an attempt to support exports. However, they are unlikely to allow either a rapid depreciation or to consider a devaluation to bring the som's official value into line with the (much weaker) black-market exchange rate.

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Official output data are highly suspect and often internally contradictory. We expect that officially reported growth rates will continue to exaggerate the true rate of economic expansion, and that the authorities will report GDP growth rates that are close to the official target. The authorities targeted real GDP growth of 7-8% in 2010, following reported growth of 8.1% in 2009. Official data put growth at 8.5% in 2010, a slight pick-up compared with 2009. The chief external factors affecting economic performance are trends in global commodity prices. Following an estimated rise of around 26% on average in 2010, gold prices are forecast to go up by a further 16% in 2011, before trending down in 2012. In 2011-12 prices for cotton will remain much higher than in 2005-09, following a sharp rebound in 2010. We continue to expect that Uzbekistan will benefit from higher prices than in recent years for its gas exports, after a tripling in prices between 2007 and 2009. Given high global prices for Uzbekistan's main exports, and the solid performance of the Russian economy, we forecast that (officially reported) real GDP will rise by 8.6% in 2011. A continuing expansion in the Russian economy should support real GDP growth of 8.7% in 2012. The economy will also be assisted by rising investment, partly funded from the FRD, but also by foreign direct investment (FDI). Private consumption will suffer from lower inflows of remittances than in 2007-08, but will be sustained by government efforts to increase wages and social payments.

The government claims that inflation in 2010 was within the official target, at 7.6%. However, official figures understate the true level of inflation, which is likely to be as much as twice as high. We estimate annual average inflation of 15% in 2010. The authorities will continue to attempt to limit inflation by the imposition of price controls on basic foodstuffs and energy. Lower global commodity prices had a disinflationary impact in 2009, but this trend reversed in 2010 (particularly because food prices rose as leading grain-exporting countries in the region were affected by drought), and commodity price trends will continue to exert upward pressure on prices, particularly in the first half of 2011. The depreciation of the local currency will also boost imported inflation. Robust money supply growth, as the government increases wages and benefits further, will be an additional factor pushing up the price level. We expect average annual inflation to pick up to 16% in 2011. A stabilisation in global food prices will lead to a slowdown to 14% in 2012.

The authorities will continue to target a slow pace of nominal depreciation in order to support export competitiveness. However, the rate of depreciation will be faster than in recent years. A global weakening of emerging-market currencies against the US dollar in late 2008 and early 2009, owing to greater risk aversion, resulted in an acceleration of the trend of som depreciation. The Uzbek currency was also affected by contagion from the steep falls in the Russian rouble and the Kazakh tenge. The pace of depreciation slowed in mid-2009 as global risk appetite returned, but picked up again in 2010, as increasing instability in the region (particularly in the Kyrgyz Republic) raised concerns about the security situation in Central Asia. By end-May 2011 the som had depreciated by a cumulative 24.6% since end-September 2008. We expect the official exchange rate to be around Som1,896:US$1 by the end of 2012, compared with Som1,638:US$1 at end-2010, a fall of about 13.5%.

The current-account surplus increased in 2010, largely owing to higher prices for Uzbek commodity exports, and to a recovery in remittances as the Russian economy returned to growth. We estimate the current-account surplus in 2010 at US$5.8bn (15% of GDP). Exports of automotives will continue to rise over the forecast period, and cotton prices will remain high in 2011. The pick-up in export revenue will push up the trade surplus in 2011, but this will be partly offset by increased import costs, owing to higher global food prices, as well as by rising demand for consumer goods and for imported inputs into state-funded infrastructure development. Our forecast assumes that gas export prices will remain higher than in the historical period. We expect the current-account surplus to increase in US dollar terms in 2011, to around US$7.5bn. The surplus will fall in 2012 as global prices ease for Uzbekistan's main exports, reducing revenue from sales of gold and cotton.

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The government has been worried by the wave of unrest in the Middle East and North Africa (MENA). Official media have avoided reporting on the unrest, suggesting that officials fear that it could spread to the Uzbek population. The government had similarly made no comment on the revolts until a televised speech by the president, Islam Karimov, on May 9th, the anniversary of the end of the second world war. Mr Karimov claimed that the MENA revolts were the product of the plans of "big forces" and "influence from outside". He also said that the "Arab Spring" revolts were linked to the countries' natural resource wealth, which is an odd claim, as it does not fit with the profile for some of the states that have seen unrest. Mr Karimov specifically mentioned Libya in his speech, possibly highlighting a fear of foreign intervention. Mr Karimov also linked what he claimed were foreign plots against resource-rich Arab states to the Andizhan uprising of May 2005. According Mr Karimov, the uprising, which was brutally suppressed by the Uzbek security services, was a result of foreigners coveting Uzbekistan's natural resources.

Mr Karimov is aware that Uzbekistan's human rights record is frequently criticised by foreign governments and non-governmental organisations (NGOs), and that human rights groups are still calling for a proper investigation into the Andizhan events. By linking the MENA revolts to Uzbekistan, and specifically mentioning Libya, Mr Karimov may have been indicating that he fears that human rights could be used as a pretext for intervention. At the same time, he also mentioned the threat of "outside agents" as a means of justifying continuing repression and the use of force against opponents. The Economist Intelligence Unit views the spread of the MENA unrest to Uzbekistan as only a limited possibility, but the authorities' concern highlights the fact that it cannot be discounted.

Security and political repression continues to be tight against the background of the unrest in MENA. Rather than addressing the concerns of human rights groups and some Western governments, Uzbekistan has made retrograde steps-the latest of which was the expulsion of Human Rights Watch, an NGO (April 2011, The political scene). However, Human Rights Watch welcomed the release of Yusuf Jumaev, a leading political prisoner, on May 18th. Mr Jumaev is one of the country's best-known poets, and had been one of the country's highest-profile political prisoners. Mr Jumaev had served three years of a five-year sentence in a prison in Jaslyk, a notorious jail where torture is reported to be endemic. He was jailed in 2008 on spurious charges of resisting arrest and wounding two policemen. He had called for Mr Karimov to resign in the run-up to the presidential election in 2007. Mr Jumaev was released early and allowed to leave Uzbekistan for the US. The 53-year-old had previously been given a suspended sentence in 2001 for insulting Mr Karimov's dignity, an offence for which he received a presidential pardon. Human rights groups and foreign governments had consistently called for his release.

Following his release, which appeared to be linked to a public apology that Mr Jumaev made to Mr Karimov, Mr Jumaev spoke publicly about his maltreatment at the hands of the prison authorities. It was already well known that he had been tortured, placed in solitary confinement and attacked by other prisoners. In addition, according to Mr Jumaev, every fortnight he was placed in a small closed container within a police van and driven to Nukus, the nearest large city, and back-a journey of 500 km.

Economic policy follows three main avenues: a tight fiscal policy, a tight monetary stance and a commitment to gradual economic reform. In practice, the government only pursues the restrictive fiscal stance. The budget, which is not subject to independent scrutiny, has been consistently in surplus in recent years owing to the gas export windfall. This has allowed the government to reduce energy and other utilities subsidies to households while maintaining spending in other areas that prevent unemployment. The government reports that the budget was in surplus amounting to 0.3% of GDP during the first quarter of 2011, following a full-year surplus of 0.3% of GDP in 2010.

Monetary policy is nominally tight because the benchmark interest rate of the Central Bank of Uzbekistan, the refinancing rate, is at 12%, almost double the official rate of year-on-year consumer price inflation. However, the true rate of inflation is likely to be much higher, making the refinancing rate negative in real terms. The Central Bank reduced the rate from 14% to 12% at end-2010, despite a rise in inflation even on official figures. The reduction suggests that the government is concerned about a slowdown in economic activity, despite its claims of robust economic growth and a steady rise in bank lending.

On the structural front, the government has declared itself in favour of gradual reform. However, in practice this means reserving the commanding heights of the economy for the state (or for well-connected figures among the political elite), restricting foreign investment, expelling foreign investors when joint ventures become lucrative, and avoiding large-scale privatisation. Uzbekistan has refused to close large numbers of insolvent firms and has thereby avoided mass unemployment. Although this has reduced the social cost of the post-communist era to an extent, it has also led to structural inefficiency.

The most revealing indication of the slow reform approach is the government's modest privatisation process. The State Property Committee sold off 26 assets during the first quarter of 2011 for just Som10.3bn (US$6m). Of the assets disposed of, 20 were owned by local governments in the capital, Tashkent. In 2010 the government disposed of 96 state-owned assets, for a total sale price of Som23bn. Despite such a modest privatisation programme, the government claims that the private sector now accounts for around four-fifths of employment.

As well as high food and commodity prices (see Economic performance), additional inflationary pressures are coming from the depreciation of the local currency, the som. By end-May the som stood at Som1,704:US$1, a cumulative depreciation of 3.8% in nominal terms since end-2010 and a fall of 11.3% since end-2009. Given the low availability of hard currency (October 2010, Economic policy), the rate of exchange on the black market is even lower. The black-market exchange reportedly stood at Som2,400:US$1 in April, down from around Som2,190:US$1 in October 2010-a fall of almost 9%, and around 42% lower than the official exchange rate. Although well connected companies are allowed to benefit from the official exchange rate when importing goods, increasing their profit margins by means of the currency trade, this is impossible for unofficial traders, who have to resort to the black-market exchange rate. This inevitably pushes up prices for imported consumer goods that are smuggled across the border.

Oxus Gold (UK) has run into difficulties surrounding its gold mining operations in the central Kyzylkum area. Oxus owns 50% of Amantaytau Goldfields (AGF), as part of a joint venture with two state-owned Uzbek partners. In February Oxus announced that it had agreed in principle to sell its 50% stake to its partners, but a month later claimed that the Uzbek auditors assessing the stake's value were not acting in good faith. It also expressed concern that the auditing team was trying to find a reason to put AGF into liquidation, thereby enabling the Uzbek state to expropriate Oxus's assets. Oxus reports that it has had no response to its appeal to reach an amicable agreement on the asset's value, and is considering international arbitration. Shavkat Tulyaganov, the deputy minister of trade and foreign economic relations, has claimed the Oxus had not paid its taxes, although he cited no evidence. Oxus rejected the accusation.

The authorities' actions seem to be an attempt to push Oxus out of the country or to gain its stake for a knock-down price. Several years earlier Oxus had difficulties with its investments in the neighbouring Kyrgyz Republic, eventually pulling out of the country after disputes with its state partners. The actions of the auditors and Mr Tulyaganov's claims about non-payment of tax appear to be part of a campaign to forcibly nationalise the company's stake in AGF. The other half of AGF is held by the State Committee on Geology and Mineral Resources (40%) and the state-owned Navoi Mining and Metallurgical Combinat (NMMC; 10%). The deposit is estimated to hold 2.84m oz of gold and 6.74m oz of silver.

The latest official figures indicate that consumer price inflation slowed in the first quarter, contrary to regional and global trends. The State Statistics Committee reports that by end-March consumer prices had risen by 2.7% since end-2010. This equates to year-on-year inflation in the first quarter of 7%, down from 7.3% in the fourth quarter of 2010 and 7.7% in the year-earlier period. Inflation is in line with the official target (of a range of 7-8% for full-year inflation), but its downward trend at a period when global commodity and food prices were rising rapidly raises doubts about the accuracy of official inflation data.

The State Statistics Committee used to report figures on retail prices for food and non-food goods. In conjunction with official figures on retail trade turnover, these data enabled us to gauge the real extent of price rises in the retail sector. Our calculations consistently showed inflation of at least double the official rate. The State Statistics Committee discontinued its publication of food and non-food goods prices in late 2010. Nevertheless, even the data that are available point to greater inflationary pressures than the headline figures suggest. According to official data, industrial producer prices rose by 17.9% year on year in January-March, up from 16.4% in the fourth quarter of 2010. Freight tariffs rose by 30.9% year on year, up from 25% in the previous quarter. Price rises for communications services slowed from 5.3% in the fourth quarter of 2010 to 3.8% in January-March 2011. However, this was partly owing to base effects: postal services prices rose by 15% in the year-earlier period. State-controlled prices for postal, telegraph and fixed-line telephony services remained flat; the increase in overall communications prices was the result of higher costs for mobile telephony, the service on which most of the population relies. Inflation in mobile telephony services stood at 8.5% in January-March, up from 8.4% in October-December 2010 and 8.9% in the first quarter of that year.

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One of the significant changes in the economy in recent months has been the sharp decline in gas exports to Russia. For the past three years rising prices and volumes of gas sales to Russia led to a considerable natural resources windfall. Unexplained factors have led to a cut in gas exports to Russia during 2011. Official statistics put exports of energy and fuel products-which overwhelmingly comprise sales of gas-at US$708m in the first quarter of 2011, still accounting for one-fifth of total exports, but a fall of 10% in value terms compared with the year-earlier period. Although no information is available on the price at which Uzbekistan sells gas to Russia, the fact that the country is following Russia's own stance of selling gas at a price model that follows global oil prices suggests higher prices than agreed in 2010. Uzbekistan has raised the price of gas sold to Tajikistan by around 9% compared with end-2010, although it has agreed a small discount with the Kyrgyz Republic, largely in the interests of maintaining stability in that country, which suffered an economic downturn in 2010 as a consequence of political unrest and inter-ethnic violence. It therefore seems clear that gas export volumes are falling significantly more rapidly than the decline in value terms.

The Uzbek government has made no comment on the phenomenon. However, Sergei Ivanov, a Russian deputy prime minister, announced at the end of May that Gazprom, the Russian state-controlled gas monopoly, had only bought 1.6bn cu metres of gas from Uzbekistan. Although Mr Ivanov did not specify the timeframe, he was probably referring to the first five months of the year. If Mr Ivanov's figure is correct, this is a cut in expected exports of around 70%, given that Gazprom had originally agreed to buy at least 13.5bn cu metres of gas from Uzbekistan in 2011. The reason for the lower export volume is unclear. Gazprom has also transported less Turkmen gas through Uzbekistan than expected, purchasing just 2.7bn cu metres in January-May out of an annual target of 11bn cu metres, around 40% below target.

Lower gas sales to Russia have cut gas output. Natural gas extraction was 16.7bn cu metres in the first quarter, a decline of 4.1% year on year. Furthermore, other parts of the oil and gas sector are also performing poorly. Output of liquids (oil and gas condensate) was 900,000 tonnes, a fall of 7.9% year on year, following a drop in output of 17.8% year on year in 2010 as a whole. This has resulted in costly imports of crude and refined products, particularly in view of high global prices. Imports of fuel and energy products more than tripled in January-March 2011 compared with the year-earlier period.

One of the main problems in Uzbekistan has been the mispricing of energy resources and state control of the sector. The result has been shortages even in times of ample output, owing to widespread inefficiency. In order to address these issues, the authorities are planning a three-year, US$75m upgrade of the Bukhara oil refinery, to enable the production of higher-quality petrol. The cost will be financed by the Fund for Reconstruction and Development (FRD), which has in turn been funded by the revenue windfall that Uzbekistan has enjoyed for its gas exports in previous years.

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Please see graphic below

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Please see graphic below

Land area

447,400 sq km, of which 9% is arable

Population

27.6m (January 2009)

Main towns

Population in '000, July 1999

Tashkent (capital): 2,400

Samarkand: 392

Namangan: 378

Climate

Continental desert

Languages

Uzbek is the state language; Russian is widely spoken; Tajik is spoken in Samarkand and Bukhara; Karakalpak is used in the autonomous republic of Karakalpakstan

Weights and measures

Metric system

Currency

The som-coupon was introduced on November 29th 1993 as the successor to the rouble. It was replaced by the som on July 1st 1994, at a rate of Som7:US$1. A multiple exchange-rate system was introduced in 1997, and the main reference rate was subsequently repeatedly devalued in order to keep pace with the rapid depreciation of the currency on the black market. The exchange rate was unified on October 15th 2003 at a rate of Som975:US$1

Time

Six hours ahead of GMT

Public holidays

January 1st (New Year); March 8th (International Women's Day); March 20th (Prophet's Birthday); Nowruz (Persian New Year); May 1st (Labour Day); May 9th (Day of Memory and Respect); September 1st (Independence Day); Eid al-Fitr (end of Ramadan); December 8th (Constitution Day); Eid al-Adha (Feast of the Sacrifice)

Official name

Republic of Uzbekistan

Legal system

The Soviet republic of Uzbekistan declared its independence on September 1st 1991, after the failure of the Moscow coup. A new constitution was adopted on December 8th 1992, declaring Uzbekistan a multiparty democracy and a presidential republic

National legislature

A bicameral parliament, the Oliy Majlis (Supreme Assembly), was elected in two stages in December 2004 and January 2005, replacing the unicameral 250-member legislature. Following the election in December 2009, the Legislative Chamber, the lower house of the new parliament, comprises 135 members chosen by direct election. The 100-member upper house, the Senate, is made up of 84 senators elected by local governments and 16 senators appointed by the president

Electoral system

Universal suffrage over the age of 18

National elections

December 2009 (parliamentary); December 2007 (presidential). Next elections due in December 2014 (parliamentary and presidential)

Head of state

Islam Karimov, re-elected president with 88% of the vote on December 23rd 2007

National government

Council of Ministers, headed by the prime minister, who is nominated by parliament on the recommendation of the president. In practice, Mr Karimov exercises total control and appoints regional governors, who report directly to him

Main political parties

Adolat (Justice) Social Democratic Party; Fidokorlar (Self-Sacrificers' Party); Liberal Democratic Party (LDP); People's Democratic Party (PDP, former Communist Party); Milliy Tiklanish (National Revival), all pro-government creations; Birlik (Unity) and Erk (Freedom), both banned democratic parties

Council of Ministers

Prime minister: Shavkat Mirziyoyev

Deputy prime ministers:

;Rustam Azimov

;Rustam Kasymov

;Gulomdzhon Ibragimov

;Nodirkhon Khanov

;Farida Akbarova

;Abdulla Aripov

;Elyor Ganiyev

Key ministers

Agriculture & water: Sayfiddin Ismailov

Culture: Rustam Kurbanov

Defence: Kabul Berdiyev

Economy: Vyacheslav Golyshev

Education: Avazjon Marakhimov

Emergency situations: Bakhtiyor Subanov

Finance: Rustam Azimov

Foreign affairs: Elyor Ganiyev

Health: Feruz Nazirov

Interior: Bakhodir Matlyubov

Justice: Buritosh Mustafaev

Labour & social protection: Akiljan Abidov

National Security Service chairman

Rustam Inoyatov

Central Bank chairman

Faizulla Mullazhanov