Investment potential of Samarkand SAMARKAND 2018
The main facts about Samarkand Area 16.8 thns. km 2. Gold Uranium Population 3,7 million Copper Zinc Gas/oil Density Languages spoken Natural resources 210 people per km 2 Uzbek, Tajik, Russian, English Over 1800 mineral reserves Samarkand 2
Why is Samarkand an attractive investment destination? Growing economy with supportive business climate Supportive business climate Growing diversified economy 1 Our President named FDI attraction as a key priority for the country We are one of the fastest growing countries in the world with diversified economy structure 4 2 We are focused on economy liberalization and created a set of attractive incentives We have abundant natural and labor resources 3rd largest in the CIS 5 3 Our efforts bring results Uzbekistan improved by 90+ points on World Bank Doing Business ranking Our political, economic, and investment environment is stable and predictable 6 3
Action strategy for 2017-2021 sets up investment climate and FDI attraction as key priorities President s Strategic Priorities Key areas of the economic policy State and public institution improvement Stable foreign exchange rate Supremacy of the rule of law Economic development and liberalization Development of the social sphere Security, interethnic harmony, and religious tolerance, and constructive foreign policy Modernization of the economy Technology development FDI promotion and investment climate Private property protection mechanisms Tax system Banking system and financial markets 4
The part of small business in economy. 100 90 80 70 60 50 40 30 20 10 0 Small businesses 98,8 Corporates 93 84,2 76,5 70,5 55 45 29,5 23,5 15,8 7 1,2 GPS Industry Agriculture Retail Service supply Employment 5
Samarkand s macroeconomic data for 2017 GDP 18,3 102,5% Industrial products Consumption products 9,1 5,56 97,7% 104,5% Increase in comparison with previous year, % Regional industry 4,34 106,5% Agricultural products 9,08 101,4% Construction 95,6% 2,35 in trln sums Retail trade turnover 9,01 101,2% Total services 8,2 104,9% 6
Natural Resources Limestone 3,7 mln.ton Raw Cement materials 2,94 bln. ton Marble 19,7 mln. m/cubes 7
Livestock products production Eggs 1,2 bln. Karakul 93,6 thns. Wool 4636 ton Milk 1,2 mln. ton Fish 3856 ton 8
Agricultural products in tons Cotton 218,900 Cocoons 2,000 grains 828,400 Veg & fruits 2, 2 mln 9
Veg & fruits production (in thns. ton) Fruits - 413-479 thns in industrial processing; -183 thns exported. Potatoes - 632 Vegetables 1,7 mln. Melons & Gourds 128,4 Grapes 615,5 10
Liberalization of currency regulations No more constraint for private business development and FDI flows starting September 2017 What it used to be Exporters were required to sell ¼ of hardcurrency revenue to the government What it is now You earn revenue it is yours. This is a fair play Controlled exchange rate of the Uzbekistani Sum to the U.S. dollar Exchange rate is determined by the free market Restricted amount of foreign currency that individuals and companies could buy Buy as much as you need. No constraints We believe in the market economy! 11
One of the most populated countries in the region with free trade access to vast neighboring potential Neighbor countries with free trade agreements Population, in million Russia 144 Ukraine 45 Kazakhstan 18 Belarus 10 Other countries 1 28 Outreach of free trade agr. Uzbekistan 245 32 Total market access 277 SOURCE: World Bank for 2016 Comparable to Brazil 1 Other countries include Tajikistan (pending final signing of free trade agreement), Kyrgyzstan, Turkmenistan, Moldova, and Armenia 12
Stable political, economic, and investor environment Political stability 26 Year of independence Economic stability 10 Year of triple budget surplus 0 Substantial crises 0 State internal debt 0 Years of political unrests Investor protection Legislative acts and decrees on: foreign investors guarantees and measures to protect rights of foreign investors measures to improve the system of protection of legitimate interests of businesses 13
Attractive tax incentives and free economic zones We welcome foreign capital with significant tax incentives 0% income tax (for SMEs) 30%-50% income tax reduction 1 0% VAT and invite them to join Urgut FEZ which is divided into 3 locations within Samarkand to get full exemption from Income tax and custom duties Social infrastructure and uniform SME taxes Compulsory contributions to the Road Fund 45% 41% 38% 30% Steady decrease of tax burden (in % to GDP) 23% 20% 19% Total implemented: 58 projects Total amount: US$ 188,7 million 1991 95 2000 05 10 15 2016 Producing capability: 2,9 billion sum 1 for 15%-30% export sales 14
TAX BENEFITS FOR SMALL BUSINESS ENTITIES 17 91 67 Small Business Entities ha Buildings thns. m2 Tax benefits Subject to 30% of total produced goods are being made for export. Unified tax payment 2 years tax exemption Property Tax Can be extended for 2 more years.
FOREIGN INVESTMENT POTENTIAL Enterprises with foreign investment 291, 63 of them foreign enterprises. Foreign partners (countries): Russia, China, Iran, USA, Turkey, Germany, Great Britain, Southern Korea, UAE and others. 16
SAMARKAND EURO ASIA TEXTILE LTD Project: Cost: Producing Country of equipments : «SamAntepGilam» LTD 8,0 bln. Sum EU Countries, Turkey, USA, Japan, China. Producing capability per annum: Exporting Countries: 1,2 mln. Men's shirts Russia Number of Employees: 150 Date of conduct : March, 2016 17
Project: SAMARKAND AUTOMOBILE FACTORY LTD «Uzautosanoat» AT, Bank «Asaka» (JSC) «ITOCHU Corporation» company, «ISUZU MOTORS» company (Japan) Cost: 100 bln. Sum Producing Country of equipments: Producing capability per annum: Number of employees: Exporting Countries: EU Countries, Turkey, USA, Japan, South Korea. 4000 980 Kazakhstan, Kyrgyzstan,Turkmenistan, Russia, Turkey, Iraq, Azerbaijan, Tajikistan. 18
Project: Cost: Producing country of equipments : Producing capability per annum: Exporting capability: Exporting Countries: Number of Employees: JV MAN Auto-Uzbekistan «Uzautosanoat» SJC-«MAN Truck & Bus AG» 70mln. euro Germany, Austria, Italy, France, England, South Korea 3000 67 in 2017(equals 5,7 mln. US dollars ) Current - Kazakhstan Kirghizstan, Tajikistan, Turkmenistan, Georgia, Russia. Future - Ukraine, Azerbaijan,Iran, Pakistan, Mongolia, Afghanistan, African Countries. 299 Date of conduct : 7th of august, 2009 19
Infrastructural potential (local). Electricity (power) 5,5 bln. kvt/h Gas 1,1 bln. m/cubes Drinkable water 407,6 mln.m/cubes Motorway 4097 km, incl: magisterial 1364 km (М-39) International airport. Int. air directions Russia (Moscow, St. Petersburg, Yekaterinburg), Turkey (Istanbul) & other countries. Railway 382,5 km Railway station. Directions: (Russia, Kazakhstan) 20
SAMARKAND AFROSIYOB CEMENT THE PROJECT OF CEMENT PRODUCTION Project: Cost: Credit Asaka-Bank: Cement production 26,1 mln. US dollars 16,9 mln. US dollars New job places: 300 21
HISTORICAL AND CULTURAL OBJECTS OF SAMARKAND Samarkand has 1105 archeological, 670 architectural, 37 attractions, 18 monumental, 21 memorial, total 1851 tangible-cultural objects. In UNESCOs world objects list Samarkand announced as Samarkand crossroad of cultures, and has been placed among 513 the most beautiful heritage objects. 22
Perks depend on amount of investment: 0.3-3 mln $ 3-5 mln $ 5-10 mln $ 10 mln $ & over *Subject to 50% of total produced good are being made for export.
Investment projects in tourism sphere Resting zone Chuponota Aqua resting zone Prospective investment projects ИСТИҚБОЛЛИ ИНВЕСТИЦИОН ЛОЙИҲАЛАР Samarkand City complex The complex of Imam al Bukhari
TOURISM POTENTIAL OF SAMARKAND 85 touristic companies 107 HOTELS about 4500 beds available Historical & cultural Eco & agro Gastronomic Extreme Pilgrimage tourism 25
SUPPORT FOR INVESTORS IN TOURISM SPHERE Perks In accordance with Republic of Uzbekistan s presidential edict (# PE-4861 December 2nd, 2016 ) is established (for business entities): Entities exempt from Taxes: on benefits, on Land, on property, and unified tax payment for 5 years. In the case of putting into service not less than 4 star (level) hotels and motels which are certified in the subject to the normal due process. Entities exempt from custom (duties) payments for 5 years (apart from fees for custom registration) for the imported equipment, technique, accessories, spare parts and materials. If, above mentioned imported items for building up and reconstruction of hotels and motels are not produced in Uzbekistan, approved in accordance with the established procedure.
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