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Economy

Uzbekistan's governors get 3.2 trillion soums to lend after 17% of last year's new firms close

Shavkat Mirziyoyev told a meeting on poverty on Thursday that 15,000 of the 86,000 small enterprises created in the regions over the past year have already stopped work, and that about 62,000 citizens are struggling to repay the bank loans that started their businesses. His answer puts the lending decision in headquarters run by the hokims, the regional and district governors.

Uzbekistan's governors get 3.2 trillion soums to lend after 17% of last year's new firms close

The figures come from the presidential press service, as carried by Gazeta.uz and Spot.uz. Poverty stands at 5.8%; the count of people in need has fallen from 2.2 million to 1.5 million. In 49 districts and 3,429 mahallas the result is close to poverty-free status; in 159 districts and cities and 5,536 mahallas the results were judged insufficient.

The president's own comparison, by the press service's account, was between two districts that received the same money, 2.3 trillion soums each: Sharof Rashidov district lifted 30,000 people out of poverty with it, Karshi district 13,000.

The new system, announced through the press secretary's Telegram channel, puts a headquarters in every region and district under the hokim. It decides who gets preferential credit for family and youth business and how much, in cash or by transfer; it can extend repayment and reshape the schedule to the type of business; it awards subsidies and interest-free loans. Hokims and their economic staff will give three days a week to poverty and employment.

The money is 3.2 trillion soums, $271 million at Thursday's central bank rate of 11,813 soums to the dollar: 1.37 trillion from the family entrepreneurship programme, 450 billion for youth business, 240 billion from the Poverty Reduction Fund, 100 billion from the Employment Fund, 760 billion from the three social registers known as the notebooks, and 300 billion of remaining funds at the state company for entrepreneurship.

The office judged on the poverty count now decides the loans.

Terms are wide. A lead entrepreneur who takes on 10 families can borrow up to 500 million soums, $42,000, without collateral; with 100 families, up to 5 billion, $423,000. Projects from citizens with earlier arrears are to be considered case by case.

Loans that 62,000 people are struggling to service were bank loans issued under the same programmes. The office judged on the poverty count now decides the loans.

The accounts the desk has read leave one question open: who carries a loan the headquarters extends and the borrower still cannot pay.