BAKU, Azerbaijan, June 25. Uzbekistan is taking steps to increase the use of domestically produced construction materials in large-scale infrastructure and tourism projects while supporting local manufacturers through new policy measures and targeted financial assistance.
This was reflected in the statement by the Press Secretary to the President of the Republic of Uzbekistan.
Speaking at a videoconference meeting, President of Uzbekistan Shavkat Mirziyoyev noted that investors involved in major and mega-projects have requested value-added tax (VAT) exemptions for imported construction materials. At the same time, domestic manufacturers have expressed readiness to compete with foreign suppliers on both quality and standards, provided similar tax preferences are extended to locally produced goods.
"If VAT incentives are also extended to domestically produced materials, we are ready to compete on both quality and standards," local manufacturers told the president.
To ensure a level playing field, responsible agencies have been instructed to prepare a draft decision that would establish equal conditions for supplying imported and domestic materials to large investment projects.
The issue comes as many producers face financial difficulties. According to official data, overdue loan debt among 457 enterprises in the sector has reached 3.5 trillion soms (about $291.1 million). Authorities attribute this largely to high production costs and products that do not fully meet current market demand. Officials have been tasked with developing short-term financial recovery programs for each enterprise, supported by $50 million in funding aimed at modernizing production facilities, lowering costs, and expanding the manufacture of high-demand products.
The government’s focus on local production is also reflected in its tourism development strategy. A recently adopted two-year program envisions the construction of 34 major tourism facilities and more than 1,000 accommodation establishments, including 200 hotels across the country.
One example is the "Kumushkon Resort" tourism complex in Parkent, where 98% of the construction materials used are domestically produced. Authorities have instructed regional administrations to ensure that the share of local materials in newly built hotels reaches at least 95%.
"Regional authorities must ensure that the share of local materials used in hotel construction reaches at least 95%," Mirziyoyev said.
To support this objective, Uzbekistan plans to expand production of key construction and finishing materials by the end of next year. Targets include increasing output of paints and coatings from 119,000 to 150,000 tons, sanitary ware from 1.5 million to 2 million units, PVC pipes and fittings from 255,000 to 300,000 tons, wallpaper from 6 million to 7.5 million units, and decorative panels from 15 million to 18 million square meters.
"It is necessary to create a system that connects major projects with local manufacturers," Mirziyoyev said.
Officials believe that strengthening domestic manufacturing capacity and integrating local suppliers into major infrastructure and tourism projects will help reduce import dependence, improve industrial competitiveness, and create new opportunities for economic growth.
Exchange rate: $1 USD = 12,020 UZS
