Avoiding the Bazaar…

by Nathan Hamm on 11/30/2004

It will be worth keeping an eye on Uzbekistan at the end of this year into the beginning of the next. While the outcome of the December 26 parliamentary election probably will not lead to much unrest, planned trade restrictions have large potential to rile up the people. The planned trade restrictions are the ones that were delayed after the Kokand riots (scroll down).

Those riots rattled the government, and IWPR reports that authorities are wary about upsetting merchants. In fact, the leadership is afraid to move forward and the people will take no more. A member of Erk told IWPR that uniformed police are avoiding Chorsu.

Some argue that the new trade rules are intended to drive merchants out of business. They undoubtedly would do so, but Uzbekistan’s government is caught between a rock and a hard place.

An alternative explanation offered by a western diplomat, who asked not to be named, is that the government is in fact trying to pursue the economic reforms required by lenders such as the International Monetary Fund, IMF. As a precondition to a resumption in lending, the IMF has insisted that the Uzbek currency be made fully convertible – and the goal of financial stability could explain why the authorities are trying to clamp down on unrestricted flows of goods and cash.

Of course, that’s not a popular view, but it probably is true. That’s not to say that it is a good move though–the bazaars are the heart and soul of many’s economic life. Conversely, some kind of regulation will be needed at some point. Either way, Uzbekistan’s government is caught in a difficult position and will potentially face major headaches in the next few months.

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– author of 2991 posts on 17_PersonNotFound.

Nathan is the founder and Principal Analyst for Registan, which he launched in 2003. He was a Peace Corps Volunteer in Uzbekistan 2000-2001 and received his MA in Central Asian Studies from the University of Washington in 2007. Since 2007, he has worked full-time as an analyst, consulting with private and government clients on Central Asian affairs, specializing in how socio-cultural and political factors shape risks and opportunities and how organizations can adjust their strategic and operational plans to account for these variables. More information on Registan's services can be found here, and Nathan can be contacted via Twitter or email.

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