Uzbekistan’s agriculture sector least affected by COVID-19 pandemic: Economic Report

Uzbekistan's agriculture sector least affected by COVID-19 pandemic: Economic Report

Tashkent (UNA-OIC) – Uzbekistan’s agriculture, forestry, and fishing industry sector was the least affected by the coronavirus, while of housing (hotel business) and food services sector was the most affected by the pandemic, according to the latest economic report on the impact of COVID-19 on the commercial enterprises in the Central Asian country.

The report – released last weekend on the findings of a comprehensive survey conducted by the Center for Economic Research and Reform (CERR), with the support of the United Nations Development Program in Uzbekistan (UNDP) – revealed that the quarantine measures undertaken by the Uzbek government influenced both the country’s economy as a whole and individual enterprises. Despite the introduction of a package of measures to support the business community, companies continue to experience a significant impact in connection with the pandemic.

The study conducted interviews with entrepreneurs about the impact of the COVID-19 spread, and the preventive measures introduced by the government on small and medium-sized businesses. It sought to analyze the impact of the spread of COVID-19 and related preventive measures on enterprises as well as the assessment of the needs of enterprises in further external support.

The survey involved 887 business managers from 14 regions of the country, aged 18 to 79, of whom the vast majority (79%) were men. On the same token, women-managers of organizations accounted for a fifth of the total number of respondents (21%).

The analysis showed that the majority of organizations did not stop their business operations amid the COVID-19 pandemic and quarantine measures. Employees mainly continued their work. Layoffs were rarely practiced.

Among the sectors of the economy, the most affected was the sector of housing (hotel business) and food services. In matters of personnel management, this area is characterized by a massive suspension of activity, the inability to transfer work to a remote format, frequent sending on vacation (especially unpaid), besides layoffs, reduction of salaries and additional payments.

The least affected sector is agriculture, forestry and fisheries. Here, mainly, the continuation of work and the preservation or even increase in wages were observed. The demand for agricultural products remained at the same level. Among the indicated problems, there were only moderate difficulties in accessing sales markets.

The survey showed that the vast majority of respondents (78%) indicated that their organizations continued to conduct business operations in the context of introduced preventive measures related to the pandemic.

The highest proportion of organizations that stopped business operations during the quarantine period were in Tashkent (31%) and in the Republic of Karakalpakstan (31%). In all sectors, the share of entrepreneurs, which reported the continuation of operations in epidemic conditions, is at least 65%, the only exception being housing and food services (30%).

On the issue of changes in the organizational policy of enterprises regarding suppliers during the pandemic, a significant number of respondents (55%) did not note any changes. However, 7-8% of enterprises indicated a search for new suppliers and agreements on fewer acquisitions.

In the direction of reducing business expenses after the introduction of COVID-19 related measures, 67% of enterprises replied that there were no changes. Only 1% of respondents ceased operations and applied for subsidies from the government.

Some 59% of the total number of respondents indicated the absence of any changes to the question of changes in the business operations regarding sales markets after the introduction of measures related to the pandemic. However, 7-8% of participants said they agreed with customers about delays in delivery times and a decline in prices for goods and services.

A significant number of small and medium-sized businesses (64%) have not changed their business development plans since the beginning of the pandemic. Only 5-6% of enterprises started the development of new forms of doing business and accelerated the development of new types of goods and services.

Meanwhile, the survey showed the group of effective government business relief measures includes a significant decline (by 20-50%) in interest rates on short-term loans (up to 1 year), reduction of rents for state assets for the required period, decrease in social deductions and taxes on labor income for the required period, VAT and excise tax reductions for the required period. The list is also complemented by subsidies and grants to support businesses and lump sum payments of social assistance (5 million soums each) to employees of companies.

AB/UNA-OIC

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