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Uzbek Investment Dispute Highlights Pitfalls Facing Emerging Economies

Navbahor Imamova

   It was to have been a benchmark deal, not only bringing a new energy
   source to Central Asia's most populous country, but also signaling that
   Uzbekistan, after decades of insular authoritarian rule, wanted to be a
   player in the global marketplace.

   But two years later, the $1.3 billion contract to build a national
   solar energy generation system languishes with an uncertain future,
   providing an object lesson for other emerging economies seeking to open
   their markets to international investors.

   This was not Uzbekistan's first bid to open up an economy that had long
   stagnated under the rule of dictator Islam Karimov. Since coming to
   power in 2016, President Shavkat Mirziyoyev has made attracting foreign
   direct investment one of his top priorities.

   His government has opened new sectors of the economy to competitive
   tenders; tapped global debt markets with a $1 billion Eurobond; and
   signed a spate of investment contracts with companies from advanced
   industrial economies including France, Canada and the United States.

   "Uzbekistan is not the same anymore. I personally guarantee that. We
   will create all necessary legal and institutional conditions" to make
   Uzbekistan attractive to investors, [1]Mirziyoyev said during a recent
   visit to Turkey.

   But the [2]contract with SkyPower Global, a Canada-based but
   majority-American-owned energy company, stands out, both for its sheer
   size and for what has since befallen it.

References

   1. https://president.uz/uz/lists/view/3372
   2. https://skypower.com/skypower-and-the-government-of-the-republic-of-uzbekistan-announce-1000-mw-solar-project-in-uzbekistan/

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