In a bad year for Eurasian trade, China consolidated its role as Uzbekistan’s main trading partner.
According to end-of-year figures for 2020 from the Uzbek State Statistics Committee, bilateral trade amounted to $6.4 billion, with the bulk of that traffic favoring Beijing. While China’s exports hit $4.5 billion, imports from Uzbekistan amounted to $1.9 billion.
Russia is lagging behind in the volume of bilateral turnover with $5.6 billion, though it still has a hefty advantage in the trade balance. Neighboring Kazakhstan came in third with $3 billion.
China has been in the first spot among Uzbekistan’s trading partners since 2015, when it overtook Russia. It also leads the way in investment stakes. Talking in September about figures for 2019, for example, the head of the State Statistics Committee said that China had accounted for 26.2 percent of foreign investments in fixed assets that year. Russia was a distant second with 10.6 percent.
As of the start of 2020, more than 1,650 enterprises in Uzbekistan are operating with Chinese capital. Russian money may be less in volume, but it is spread more widely, across around 1,820 businesses.
This has, of course, been an anomalous year for trade. Exports from Central Asia to China suffered across the board as a result of the COVID-19 pandemic, and Uzbekistan was no exception. In dollar terms, China’s statistics show imports from Uzbekistan dropped more than 30 percent.
The fact that China’s overall imports fell only 1.1 percent draws a compelling picture about the kind of trade that is going on and what the future may hold. Raw materials are highly susceptible to painful fluctuations and Uzbekistan appears to have paid a heavy price.
Russia, which has less appetite for those raw goods, could aim at regaining pole position by offering Tashkent a more interesting and diversified proposition.
“Most likely, China will retain its leadership in Uzbekistan's foreign trade turnover in 2021,” said economics commentator Navruz Melibayev. “But over the next few years, the situation may change in Russia’s favor. Uzbekistan gained observer status in the Eurasian Economic Union at the end of 2020. Simplification in the rules of mutual trade could lead to an increase in trade between the two countries.”
Uzbekistan is also actively pursuing membership in the World Trade Organization, which could offer yet other options. China will doubtless dominate for the foreseeable future, but competition is on the horizon.