During his first official visit to Berlin on January 20-22, President of Uzbekistan Shavkat Mirziyoyev initiated a new dialogue format of Central Asia + Germany. Together with German President Frank-Walter Steinmeier, Chancellor Angela Merkel, and Bundestag President Wolfgang Schauble, he discussed cooperation between the countries in the spheres of petrochemistry, engineering, transport, communications, tourism, and culture.
Cooperation between Germany and Uzbekistan became possible when Tashkent had started wide political and economic reforms. It was stated by Angela Merkel at the meeting with Mirziyoyev. She also welcomed a new regional policy of Uzbekistan on creation of a friendly and trust-based atmosphere in Central Asia. According to her, Germnay is ready to be a partner for Uzbekistan in improving human rights, establishing a civil society, and extending economic cooperation. Steinmeier said that he had plans to visit Uzbekistan in spring 2019.
For Uzbekistan, Germany’s support primarily means investment. 2019 was declared the Year of Active Investment in the country. Tashkent is intensively searching for loans for modernization of economy while Germany is still one of key funders in the EU. The Uzbek government realizes that without modern technologies, including German ones, it is impossible to provide structural reforms. Tashkent is ready to offer German businesses such spheres as chemistry, petrochemistry, pharmacy, healthcare, production of construction materials, and agriculture. Germany hasn’t displayed an active attitude in recent decade. It invested only 750 million euro in Uzbekistan during the period. The bilateral trade is also low. In January-November 2018, its volume was $712.1 million.
Shavkat Mirziyoyev underlined that “Uzbekistan and Germany have a free hand for increasing bilateral trade from 700 million euro to 1 billion euro.” Uzbek President said that “Uzbekistan sees a reliable and time-proved partner in Germany.” As a result of the talks, nine intergovernmental and inter-institutional documents were signed in the spheres of economy, trade, finances, education, science, and innovations. Moreover, the sides agreed on implementation of new major projects together with such German companies as Siemens, ThyssenKrupp, Claas, MAN, Knauf, Linde, Papenburg, Humana, Volkswagen, and so on. Ahead of Mirziyoyev’s visit, Berlin hosted the German-Uzbek Business Forum where investing contracts for $4 billion were signed.
“Financial and industrial businesses of Germany come to new markets expecting staying there for the long haul. So, they act steadily and systematically. They are not after phenomenal indices at early stages but make themselves comfortable thoroughly. Results of the Berlin economic forum are a challenge for the Uzbek government. Each contract needs supervision, constant monitoring, and control by Tashkent. It’s about establishment of a legal model of foreign investment presence for a partner who is very demanded for comfortable and transparent business conditions. I think if the model succeeds (unfortunately, none of Uzbekistan’s neighbors could reach the goal), investments will come to Uzbekistan without any problem,” Igor Pankratenko, Deputy CEO of the Center of Strategic Assessment and Forecast, told Vestnik Kavkaza.
According to Bakhtiyer Ergashev, President of the Ma’no Center of Survey Initiatives, Tashkent set a special goal to develop export orientation of the country and diversify Uzbek outlet markets. New outlet markets are needed for that. “We export only agricultural products and textile to Europe. However, the range will extend in the future. The EU has confirmed its readiness to help Uzbekistan with unilateral tariff preferences within the framework of the General System of Preferences Plus. It will encourage duty-free export of more than 6 200 Uzbek products to Europe,” Ergashev said.
The expert pointed out that Germany was the first country that suggested development of the Central Asia Strategy in 2007. Last year, the third amended strategy which focused on economy was presented. Previously, the strategy of EU-Central Asia partnership included a big number of political and NGO projects. Now German business will provide its investment policy in a comfortable economic climate. There are reasons to suppose that signed agreements of intent will be implemented. Today the republic has 132 companies with the involvement of German investors, including 33 businesses with 100 per cent of German capital. A Deutsche Bank office works in Tashkent.
“On the one hand, Europe is interested in developing relations with Central Asian countries, firstly with modern Uzbekistan. Some political steps made by Uzbekistan sparked big interest and support in the West. So there is a nice opportunity for direct contacts and ties,” the expert stated. According to him, the interest is explained by the fact that the EU and Germany need an access to South and Southeast Asia. Transport corridors suggested by India and implemented by China will pass through Central Asia, including Uzbekistan. Berlin sees Uzbekistan as a promising transit direction for land access to South and Southeast Asian markets, primarily China and India.
Security was also discussed at the Berlin summit. Tashkent and Berlin stand for a peaceful settlement of the Afghan conflict through negotiations and encouragement of socio-economic development of Afghanistan. Both countries believe that terrorism, extremism, and radicalization are main threats to international security. It’s a new era of cooperation between Uzbekistan and Germany. American President Donald Trump’s statement on possible withdrawal of the U.S. troops from Afghanistan may encourage the cooperation, Bakhtiyer Ergashev says. According to him, the German government thinks that Germany should take the niche in Afghanistan after withdrawal of American troops. Probably, the problem of Uzbek-German cooperation in Afghanistan was also discussed at the summit.