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ELECTROTECHNICAL INDUSTRY AS AN IMPORTANT DRIVER OF
THE ECONOMY OF UZBEKISTAN
Rashidova Odina
Tashkent State University of Economics
Abstract.
In the article, the economic development of the electrotechnical industry, the rate of
growth of the production volume of electrotechnical products, and the export indicators of electrotechnical
products are studied over the years, and the geography of product export is highlighted. Development
prospects for the next period have been defined.
Keywords:
Export of electrical engineering industry, tax benefits, cable and wire products,
household appliances, power equipment, capitalized investments.
Introduction.
As we all know, the electrical engineering industry, which is becoming an important driver of our
economy, has changed radically in the last 3-4 years. This industry is youngest and at the same time one
of the rapidly developing industries. As a result of the reforms carried out in New Uzbekistan, the
electrical engineering industry has become one of the important sectors of our country. Today's fast-
paced era and the rapid development of market mechanisms in the economy are causing the steady
growth of the electrical engineering industry as well as other industries. Naturally, this presents us with
the most pressing tasks of radically improving the industry, introducing new market mechanisms,
increasing production capacity, and ensuring employment of the population. The share of the
production of electrical engineering products in the republic's industry is also increasing year by year.
In the decree of the President of the Republic of Uzbekistan dated 02.03.2021 No. PD-5011 "On
additional measures to further develop the electrical engineering industry and increase the
competitiveness of local products" defined to increase the volume of deep processing of copper raw
materials to 70,000 tons in 2022, production to 19 trillion sums in 2022, the volume of exports of
products in 2022 to 600 million US dollars, to increase the number of jobs in the network to 34,000 in
2022. (Presidential decree, 2021)
This decree adopted by our country's president opened the door to new opportunities for the
future of the industry. It is noteworthy that a new era has begun for the enterprises of the electrical
engineering industry. It is no exaggeration to say that it was mutually beneficial for both local
entrepreneurs and foreign investors.
According to the decree of the President of the Republic of Uzbekistan dated 04.01.2019 No. PD-
4090 "On measures to increase the export volume and production of the electrical engineering
industry", in 2021, it is planned to increase the export volume of finished electrical engineering and
electrical household products to the amount of 400 million dollars. (Presidential decree, 2019)
Over the past five years, in order to develop the electrical industry, a number of Presidential
resolutions (PD-2772, PD-4090, PD-4348, PD-5011, PD-5128, etc.) investment projects for the technical
and technological renewal of existing and creation of new industries in the industry, as well as the
creation of the Fund for the Development of the Electrical Industry. Issues related to the prospects for
the development of the electrical industry were also discussed at meetings held under the chairmanship
of the head of our state on May 6 and September 26.
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Literature review.
Petrochenkov (2014) in his work on the energy-information model of electrotechnical industrial
production proposed two stages: obtaining the models of the first stage, and the interaction model of
the new stage.
In his scientific research, Khrenov (2021) studied the export activity of non-ferrous metallurgy in
the electronics industry.
Semukhin's (2019) researches are devoted to the peculiarities of entering the foreign market of
electrical engineering enterprises. In his opinion, the basis of the effectiveness of foreign economic
activity is the development of a comprehensive strategy, taking into account the specific characteristics
of the importing country. It is also necessary to take into account the features of the manufacturing
process of electrical equipment. In this regard, the factors affecting the activity of electrical engineering
enterprises were considered, and the ways of adapting the products to the requirements of the foreign
market were determined.
In his research, Tursunkhojaev (2022) studied the issues of improving the use of marketing tools
to ensure the economic security of electrical engineering enterprises in Uzbekistan.
However, foreign and local scientists have not sufficiently studied the export potential and
external economic mechanisms of electrical engineering enterprises. Conducting research in this area
shows the need to ensure "green" economy, achieve green economic growth, increase the export
potential of electrotechnical industry products, which is rapidly developing in the country's industrial
products export, and improve organizational and economic mechanisms.
Research methodology.
As a result of our research, a scientific-methodical proposal and practical recommendations have
been developed aimed at developing the products of the electrical engineering industry, expanding the
export geography, and improving the ways of effective use of our existing opportunities. Methods such
as space and time, quantity and quality, abstract thinking, logical approach, comparative analysis and
prospective forecasting were widely used in conducting the research.
Results and discussion.
Currently, about 500 manufacturing enterprises operate in the electrical engineering industry,
most of them are small, which produce products of more than 2 thousand items. The number of
employees in the industry has reached 32 thousand people. The largest 88 enterprises in the industry,
which produce more than 95% of the volume of all electrical products, are members of the
“Uzeltekhsanoat” association
, 18 of them produce cable and wire products, 36 - household appliances
and 34 - electric power equipment and other products. It should be noted that almost all enterprises in
the industry are private.
A number of customs and tax benefits, as well as subsidies, have been provided to enterprises in
the industry. For example, until January 1, 2025, they are exempt from paying customs duties for raw
materials, materials, components and equipment imported for their own production needs. Thanks to
this, over the past 5 years, $ 560 million have been invested in the industry, 163 new projects have been
launched. Currently, 205 projects worth $1.2 billion are being implemented. As a result, the volume of
production increased by 5 times, exports by 3 times, and the number of jobs increased by 2 times.
Industry in production indicators. For the period 2017-2021 the volume of products
manufactured by enterprises in the electrical industry increased 5 times, from 3.4 trillion. sum. up to
16.7 trillion sums, household appliances - 6 times, cable and wire products - 1.5 times, power equipment
and other products - 8.7 times.
At the end of 2022, it is expected that the volume of production of electrical products will grow by
19% and amount to about 19.9 trillion. sum. At the same time, the largest growth is expected in the
production of cable and wire products by 46.2% - up to 6.9 trillion. sum. and the production of household
appliances by 20.5%, up to 6.8 trillion. UZS., and the volume of production of power equipment and
other products may decrease by 2.5% - up to 6.2 trillion sums. In 2022, according to preliminary data,
the volume of exports of electrical products increased by 42.4% and reached a record high of $800.8
million, of which exports of cable products amounted to $518.1 million (an increase of 34.0%),
household appliances
—
$226.5 million (up 67.5%), power equipment and other products
—
$56.2
million (up 38.1%).
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Table 1.
Electrotechnical products production volume indicators
27
(billion sums)
2017
2018
2019
2020
2021
2022
Growth in
2022 to
2021
Total
3375.4
4432.3
7944.4
12618.0
16695.9
19871.0
119.1%
Cable products
1717.9
1617.2
2628.9
2645.0
4738.7
6926
146.2%
Share in total
50.9%
36.5%
33.1%
21.0%
28.4%
34.9%
Household
appliances
927.0
1040.0
2097.0
4730.0
5598.6
6748.5
12.05%
Share in total
27.5%
23.5%
26.4%
37.5%
33.5%
34.0%
Power
equipment and
other products
730.5
1775.1
3218.5
5243
6358.6
6196.5
97.4%
Share in total
21.6%
40.0%
40.5%
41.6%
38.1%
31.2%
At the same time, more than half of the total export volume was cable and wire products - 64.7%,
about one third - household appliances (28.3%), the rest - power equipment and other products (7.0%).
At the end of 2022, in the structure of the total production of electrical products, the share of
cable and wire products will be 34.9%, household appliances - 34.0%, and power equipment and other
products - 31.2%.
Figure 1. Indicators of the volume of production of electrotechnical products
At the same time, according to the results of the current year, the enterprises of the
Uzeltekhsanoat association plan to produce an electric cable of 24.4 thousand km (an increase of 20%
by 2021), a LAN cable for Internet networks - 48.3 thousand km (+ 17%), TVs - 510 thousand pieces.
(+18%), household refrigerators - 355 thousand units. (+18%), air conditioners - 240 thousand units.
(+18%), washing machines - 500 thousand units. (+24%), vacuum cleaners
—
350 thousand units.
(+17%), kitchen stoves
—
1.33 mln. (+26%) and others.
Expansion of export opportunities. It should be noted that over the course of 5 years, both the
range of export products of the industry's enterprises and the geography of export countries have
expanded. In order to enter new markets, the industry enterprises received more than 40 international
certificates, the number of exported goods additionally included water pumps, elevators and escalators,
industrial coolers, solar water heaters and other products.
27
Information of the "Uzeltechsanoat" association
3,4
4,4
7,9
12,6
16,7
19,9
1,7
1,6
2,6
2,6
4,7
6,9
0,9
1
2,1
4,7
5,6
6,7
0,7
1,8
3,2
5,2
6,4
6,2
2017
2018
2019
2020
2021
2022
production volume
cable products
household appliances
power equipments
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Figure 2. Structure of production by types of electrotechnical products
In the current year, the enterprises of the industry have exported more than 120 types of electrical
goods to 48 countries, while in 2017 the export structure included only about 25 types of goods, which
were mainly supplied to the CIS countries. For the first time, 13 enterprises from Fergana, Samarkand,
Kashkadarya and Tashkent regions entered the foreign market. The list of new export countries includes
the EU countries
—
Great Britain, Romania, Slovenia, the Czech Republic, Hungary, etc., where products
are delivered under the preferential trade regime (GSP +), as well as several countries in the Middle
East, Africa and Mongolia.
The growth in the production of electrical products contributed to the growth in exports, which
over the past 5 years have increased 3 times - from $189.7 million (in 2017) to $562.5 million (in 2021).
At the same time, the export of household appliances grew 6.6 times - from $20.6 million to $135.2
million, cable and wire products - 2.6 times - from $146.9 million to $386.7 million, power equipment
and other products by 1.8 times - from $22.1 million to $40.7 million.
Table 2.
Export indicators of electrotechnical products (billion sums)
2017
2018
2019
2020
2021
2022
Growth in
2022 to
2021
Total
189.7
116.5
250.2
326.5
562.5
808.8
143.8%
Cable-wire
products
146.9
65.5
157.5
164.9
386.7
518.1
134%
Share in total
77.4%
56.2%
62.9%
50.5%
68.7%
64.7%
Household
appliances
20.6
26.4
45.3
94
135.2
226.5
167.5%
Share in total
10.9%
22.7%
18.1%
28.8%
24.0%
28.3%
Power
equipment and
other products
22.1
24.6
47.4
67.6
40.7
56.2
138.1%
Share in total
11.6%
21.1%
18.9%
20.7%
7.3%
7.0%
It should be noted that the largest share in the total export volume in 2022 is cable-wire products
- 64.7%, household appliances - 28.3%, power equipment and other products occupies 7.0%.
The geography of export products has expanded, and currently available in 48 countries, including
Austria, Hungary, Romania, Netherlands, Finland, Czech Republic, Africa is being delivered. Over the
past period, industry enterprises received 41 international certificates to enter new markets. The export
nomenclature has also been expanded, about 200 types of exported products include water pumps,
elevators and escalators, industrial chillers and solar water heaters were also included.
At the end of 11 months In 2022, compared to the same period last year, 276 thousand
refrigerators were exported. (growth by 55 thousand units), TV sets 210 thousand units. (growth by 15
35%
34%
31%
Cable products
Household appliances
Power equipment and
other products
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thousand units), washing machines 204.3 thousand units. (growth by 19 thousand units), air
conditioners 54.3 thousand units. (an increase of 16.1 thousand units), the volume of exports of these
types of products amounted to $68.3 million, $36.7 million, $22.1 million and $13.9 million, respectively.
Figure 3. Export dynamics of electrical engineering products (billion sums)
The main export countries of electrical products are Turkey (38% of total exports), Russia (20%),
Kazakhstan (12%), China (5.4%), Tajikistan (5.4%), Azerbaijan (4.1% ), Kyrgyzstan (4.0%), Georgia
(1.8%), Belarus (1.0%), Lithuania (1.0%), Turkmenistan (1.0%), Hungary (0.6%) and other. At the same
time, it should be noted that the share of Turkey in exports is the highest due to the supply of the main
volume of exported copper wire and copper pipes to this country. At the same time, the main volume of
finished electrical goods is exported to the CIS countries.
Attracted investments. During 2017-2021 the total volume of assimilated investments in the
electrical industry amounted to $561.0 million. As a result of the implementation of investment projects
in the electrical industry, the production of new types of products that were previously imported was
mastered. In particular, the production of modern models of TVs, household washing machines, electric
ovens and gas stoves, air conditioners, refrigerators, electric and solar water heaters, LED lamps, electric
and gas meters, transformers, modern electrical cables and LAN wires has been launched.
Table 3.
Total indicators of investments in the electrotechnical network
28
2017
2018
2019
2020
2021
2022
2023
(expected)
The volume of capitalized
investments (million dollars)
99.7
46.9
70.0
193.8
150.6
169.7
191.5
At the end of 2022, the volume of capitalized investments amounted to 169.7 million dollars, of
which 46.4 million dollars are foreign direct investments, due to which 36 new projects were launched
and More than 2.5 thousand additional jobs were created.
In accordance with th
e “Investment Program of the Republic of Uzbekistan for 2023
-
2025”
approved by the Decree of the President PP-459 dated December 28, 2022 in the electrical industry in
28
Information of the Statistics Agency under the President of the Republic of Uzbekistan
189,7
116,5
250,2
326,5
562,5
750
146,9
65,5
157,5
326,5
386,7
427,3
20,6
26,4
45,3
94
135,2
230,3
22,1
24,6
47,4
67,6
40,7
92,4
0
200
400
600
800
1000
1200
1400
1600
2017
2018
2019
2020
2021
2022
Total
Cable products
Household appliances
Power equipment and other products
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the next three years, it is planned to master only $604.9 million of investments, of which $183.0 million
is foreign direct investment. At the same time, in 2023, as part of the implementation of 29 new
investment projects and 7 projects for the modernization and reconstruction of enterprises, it is planned
to master $191.5 million of investments, of which $58.0 million will be foreign direct investment.
Conclusion and suggestions
Despite the fact that the local electrical engineering industry is rapidly developing in terms of
increasing the volume of manufactured products, its assortment and competitiveness in the foreign
market, there are still a number of problems facing the industry, the solution of which determines the
prospects for its further development. In particular, taking into account the geographical location of the
Republic of Uzbekistan, it is necessary to focus on the production of industrial goods that have high
added value, but do not have high transportation costs. In addition, the industry has a high threshold for
market entry. Given that Uzbekistan is gradually increasing its focus on integration into World
Federation of Trade Unions (for example, the WFTU), joining these integration unions will lead to the
emergence of large global players in the local market, which will significantly affect the dynamics of the
industry. can show.
The experience of the countries where the electrical engineering industry of Uzbekistan managed
to significantly increase the share of electrical engineering products in the export structure shows that
the amount spent on research and development is 1% of the average GDP. In the Republic of Uzbekistan,
this indicator is about 0.1% of the country's GDP.
The electrical engineering industry continues to develop steadily. In this case, significant state
support will be provided to branch enterprises in the form of tax and customs benefits, subsidies,
creation of favorable conditions for participation in state procurement, and exporters will be provided
with transportation costs and funds spent on holding exhibitions of their products in foreign countries.
A certain part of 's will be covered.
It is necessary to introduce competitive intelligence in the enterprises of the electrical engineering
industry, to optimize the production program by product type based on the study of changing market
requirements and the external environment.
The potential of our country in the field of electrical engineering is still high. Giant projects are
being implemented in the direction of green energy will open new markets worth at least $1 billion a
year to local producers. It will create a thorough ground for the establishment of an electrical
engineering cluster and open the way to thousands of new jobs.
At the same time, the following factors will play a key role in increasing the volume of exports of
products manufactured by enterprises in the industry: ensuring the quality and certification of products
in accordance with international standards, the production of goods under well-known brands, as well
as price competitiveness in the foreign market of exported goods.
The electrical engineering industry is one of the driver sectors of the economy of Uzbekistan and
demonstrates accelerated development. The Development Strategy of New Uzbekistan provides for
2022-2026. increase the volume of industrial production by 1.4 times, including high value-added
products in the electrical industry by 2 times and exports by 3 times.
Uzbekistan imports electrical goods worth $1.3 billion. Demand for semiconductors and
electronic boards is growing in our country and neighboring markets, which is estimated at $6 billion.
In the next 5 years, it is planned to increase copper production in the country by 3 times and bring the
share of its processing finished products by 2026 to 70%.
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Decree (2021)
“On additional measures to further develop the electrical engineering industry and
increase the competitiveness of local products” No. DP
-5011 of the President of the Republic of
Uzbekistan dated 02.03.2021.
Decree (2021)
“On measures to further develop and increase the export potential of the electrical
engineering industry” Decree No. DP
-5011 of the President of the Republic of Uzbekistan dated
04.01.2019.
Ivanovich, K. K. (2020). About some questions of classification of institutional conditions
determining the structure of doing business in Uzbekistan. South Asian Journal of Marketing &
Management Research, 10(5), 17-28. Doi:
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Iryna Lavriv (2016), The factors affecting the export potential and its formation under the
conditions of integration. Baltic Journal of Economic Studies, Lviv National Agrarian University, Ukraine.
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Kholmirzaev A. H. (2022). Ways to increase the competitiveness and export potential of industrial
enterprises in the country. "Science and Education" Scientific Journal. Volume 3 Issue 5.
Khrenov, V. V. (2021). Export activities of the enterprises of the electrical industry and non-
ferrous metallurgy of the city of Sverdlovsk in relation to the DPRK in 1958. Korea management in
Russia: direction and development, 2 (4), 137-144.
Mamayusupova, M. S. (2023). Increasing the export potential of electrotechnical industry
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research, 3 (02), 65-72. Doi:
https://dx.doi.org/10.5281/zenodo.7732836
Petrochenkov A.B. (2014). Energy information model of electrotechnical complexes of industrial
enterprises. Electrical Engineering, (11), 47-51.
Semukhin, M. I. (2019). Features of entering the foreign market of electrical companies. In Basic
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Tursunkhojaev S.J. (2022). Improving the use of marketing tools to ensure the economic security
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