SOLUTION OF SOCIAL PROBLEMS IN
MANAGEMENT AND ECONOMY
International scientific-online conference
21
STAGES AND CHARACTERISTICS OF THE DEVELOPMENT OF THE
SECURITIES MARKET IN UZBEKISTAN
Khidirnazarov Azamat Mamarajabovich
Gulistan state university, Uzbekistan
https://doi.org/10.5281/zenodo.16785065
Abstract.
This thesis examines the development stages and key features of
the securities market in Uzbekistan, tracing its evolution from the early post-
independence period to the present. The research analyzes the institutional,
legal, and economic factors that have shaped market growth, as well as the
challenges hindering its full potential. A comprehensive review of domestic
reforms and global capital market trends provides a comparative perspective,
highlighting opportunities for policy improvement and innovation. The findings
reveal that while significant progress has been made in establishing the
foundational infrastructure, the market remains relatively underdeveloped in
terms of liquidity, investor diversity, and product range. Addressing these gaps
will require strategic reforms, such as enhancing transparency, strengthening
regulatory frameworks, expanding financial instruments, and fostering investor
education. Ultimately, a competitive and well-regulated securities market is
essential for mobilizing investment, supporting sustainable economic growth,
and integrating Uzbekistan more effectively into the global financial system.
Keywords:
Uzbekistan, securities market, capital market development,
stock exchange, financial reforms, investment, economic growth, financial
regulation.
Introduction.
The development of a competitive and efficient securities market is
essential for stimulating economic growth and mobilizing investment in
emerging economies. In Uzbekistan, the establishment of the Republican Stock
Exchange “Tashkent” in 1994 marked a pivotal step toward the formation of a
capital market following the dissolution of the Soviet Union (Alimov &
Mukhamedov, 2021; BM.GE, 2025). Despite such efforts, market activity
remained subdued for years, constrained by limited trading volumes, narrow
investor participation, and dominant state ownership in listed companies
(BM.GE, 2025; Ataniyazov & Sayfullokhon, 2022).
Recent years, however, have seen the launch of bold reform initiatives
aimed at revitalizing the securities market. These include enhancements to
regulatory and legal infrastructure, adoption of digital identification systems,
and alignment with global standards (Muxamedov & Ibodullayev, 2025). In
addition, Uzbekistan’s partnership with Franklin Templeton to manage the
SOLUTION OF SOCIAL PROBLEMS IN
MANAGEMENT AND ECONOMY
International scientific-online conference
22
National Investment Fund and the planned listing of $1.7 billion in state assets
by early 2026 illustrate the country’s commitment to attracting international
capital and fostering transparency (Financial Times, 2025).
Nevertheless, significant challenges persist. Market liquidity remains low,
and investor confidence needs bolstering through increased transparency,
modern financial instruments, and improved digital infrastructure (FT, 2025;
Kursiv Uzbekistan, 2025).
This thesis examines the structural and temporal stages of Uzbekistan’s
securities market development, assesses current strengths and weaknesses, and
proposes policy recommendations to enhance market efficiency and integration
into global financial systems.
Main div.
1. Historical Evolution and Market Structure
Following the dissolution of the Soviet Union, Uzbekistan embarked on
gradual privatization, converting state enterprises into joint-stock companies
and listing a portion of their equity through the Republican Stock Exchange
“Tashkent” (RSE) in April 1994 (Wikipedia, 2025). This cautious approach
avoided the emergence of oligarchic structures and promoted broad-based,
albeit limited, shareholder ownership (Wikipedia, 2025).
By mid-2024, the Tashkent Stock Exchange listed over 100 issuers and 157
securities, with primary market capitalization approximating 21% of GDP.
Trading activity surged—transaction counts increased by 82%, though overall
trading volume dropped by 79% compared to 2023. The market boasted over
813,600 brokerage clients, most being individuals (UzDaily, 2024).
2. Recent Dynamics and Retail Investor Surge
A watershed year, 2023, saw a dramatic surge in retail participation.
Factors such as fintech innovations (e.g., Jett.uz) and mobile trading apps
democratized access, resulting in over 411,900 stock transactions amounting to
2.7 trillion soms (~$215 million)—a fivefold increase in volume from the
previous year. Yet, overall transaction value declined due to diminished large-
scale privatization deals.
October 2023 marked a record-breaking month for market activity: trading
volume reached UZS 20.7 billion (~$1.7 million), an 8.5-fold year-on-year
increase, driven by OTC expansion and bond market developments. Notably,
Uzbekistan issued local-currency green bonds (UZS 4.25 trillion) and USD-
denominated Eurobonds ($660 million), both highly oversubscribed (Daryo,
2023).
SOLUTION OF SOCIAL PROBLEMS IN
MANAGEMENT AND ECONOMY
International scientific-online conference
23
3. Regulatory and Institutional Reforms
Uzbekistan has embarked on sweeping regulatory reforms since 2021,
centered on deepening market infrastructure, enhancing investor protections,
and fostering international integration.
a. Institutional Restructuring
The National Agency of Perspective Projects (NAPP) assumed regulatory
authority over the capital markets in 2023, consolidating responsibilities
ranging from licensing to corporate governance oversight (Azizov & Partners,
2023).
A major roadmap for 2023–2025 introduced key reforms, including
transforming the Central Securities Depository (CSD) into a joint-stock company,
creating a National Clearing Center, and establishing regulatory sandbox
provisions for market innovation (Azizov & Partners, 2023).
b. Technology and International Connectivity
Beginning in 2025, the CSD will consolidate custody of corporate and state
securities under the Central Bank, enhancing efficiency (Daryo, 2023).
. Collaboration with Korea Exchange (KRX) introduced a unified IT
infrastructure, supporting modernization efforts (Wikipedia, 2025).
Integration with global systems is underway: RSE data is now accessible via
Bloomberg terminals, broadening international investor reach (RSE press
release, 2024).
Discussions with Clearstream aim to enable seamless cross-border
custodianship (Silk Capital profile, 2025).
c. Legal Enhancements and Investor Incentives
Legislative reforms introduced tax incentives for IPO participants,
workplace-based share ownership plans (ESOPs), and regulatory safeguards,
such as mandatory dividend distribution and authority for regulators to replace
non-compliant company management (Daryo, 2023; Azizov & Partners, 2023).
A key development involves Franklin Templeton’s management of the
Uzbekistan National Investment Fund, which plans to list $1.7 billion in state
assets globally by early 2026, signaling a push toward liberalizing state
ownership and attracting foreign capital (Financial Times, 2025).
4. Achievements and Structural Challenges
Reforms have yielded several positive outcomes:
Enhanced Market Access and Activity: The retail boom and mobile trading
penetration expanded participation (Alkes Research, 2024).
SOLUTION OF SOCIAL PROBLEMS IN
MANAGEMENT AND ECONOMY
International scientific-online conference
24
Financial Innovation: The launch of green bonds and OTC trading increased
institutional depth (Daryo, 2023).
International Integration: Bloomberg exposure and infrastructural progress
position Uzbekistan within global capital flows (RSE, 2024; Silk Capital, 2025).
Despite benefits, significant obstacles remain:
Low Liquidity and Investor Confidence: Volatility, concentrated state
ownership, and sporadic trading volumes hinder market vibrancy (BM.GE,
2025).
Substantial State Presence: The state continues to hold majority stakes in
many listed companies, limiting free float and governance diversity (Wikipedia,
2025).
Regulatory Consolidation Risks: While institutional reform aids efficiency,
the transition poses challenges in capacity-building and legal clarity.
Global Integration Impediments: Delays in underwriting infrastructure (e.g.,
Clearstream) and low free-float value continue to deter some foreign investors
(Financial Times, 2025).
5. Synthesis: Road Ahead
Taken together, Uzbekistan’s securities market stands at a pivotal juncture.
Institutional and regulatory modernization, coupled with digitalization and
international partnerships, have laid a strong foundation for capital market
growth. Increased retail involvement, diversification of instruments (e.g., green
bonds), and opening assets to global investors signal positive transformation.
However, for sustainable advancement, policy-makers should focus on
enhancing liquidity (e.g., through new IPOs), strengthening governance through
reduced state concentration, deepening infrastructure (e.g., completing
Clearstream integration), and building investor trust via transparency and
stewardship. These steps will forge a dynamic, inclusive, and resilient capital
market aligned with international standards.
Conclusion
The development of Uzbekistan’s securities market has undergone a
complex and multifaceted transformation, shaped by the country’s broader
economic reforms, institutional restructuring, and integration into the global
financial system. The historical evolution of the market reveals distinct stages,
from the early establishment of rudimentary trading platforms and the adoption
of foundational legal frameworks in the 1990s, to the more structured and
technologically advanced systems emerging in recent years. This progression
reflects not only the government’s strategic priorities but also the growing
SOLUTION OF SOCIAL PROBLEMS IN
MANAGEMENT AND ECONOMY
International scientific-online conference
25
recognition of capital markets as a critical driver of sustainable economic
growth.
Despite significant progress, challenges remain in ensuring sufficient
market depth, liquidity, transparency, and investor confidence. The limited
participation of institutional investors, the underdevelopment of derivative
instruments, and relatively low public awareness of securities investment
continue to hinder the full realization of the market’s potential. Addressing these
issues will require targeted reforms, including the modernization of regulatory
frameworks, the introduction of innovative financial products, and the
strengthening of investor education initiatives.
International experience shows that robust capital markets serve as an
essential mechanism for mobilizing long-term financing, diversifying investment
opportunities, and enhancing economic resilience. For Uzbekistan, fostering a
competitive, transparent, and well-regulated securities market will be
instrumental in attracting both domestic and foreign investment, thereby
supporting the country’s long-term socio-economic development objectives.
In conclusion, the securities market of Uzbekistan stands at a pivotal
juncture. Strategic policy interventions, informed by both domestic needs and
global best practices, can transform it into a dynamic engine of economic
modernization, innovation, and inclusive growth..
References:
1.
Alimov, O. D., & Mukhamedov, F. T. (2021). The stock market in Uzbekistan
as the backbone of country’s economic development. International Journal of
Business,
Economics
and
Management,
4(2),
389–394.
https://doi.org/10.31295/ijbem.v4n2.1717
2.
Ataniyazov, J., & Sayfullokhon, N. (2022). Stock Market in Uzbekistan:
Current Situation and Development Prospects. British Journal of
Multidisciplinary
and
Advanced
Studies,
3(1),
1–10.
https://doi.org/10.37745/bjmas.2022.00121
3.
Azizov & Partners. (2023, September 20). The roadmap for the
development of the capital market in 2023–2025 has been approved. Retrieved
from [Azizov & Partners].
4.
BM.GE. (2025, June 18). The Evolution and Outlook of Uzbekistan’s Equity
Market. BM.GE.
5.
Daryo News. (2023, October 30). Uzbekistan unveils sweeping reforms to
bolster capital markets and attract international investors. Retrieved from
[Daryo].
SOLUTION OF SOCIAL PROBLEMS IN
MANAGEMENT AND ECONOMY
International scientific-online conference
26
6.
Financial Times. (2025, May 1). Franklin Templeton to list $1.7 bn of
Uzbekistan state assets. Financial Times.
7.
Kursiv Uzbekistan. (2025). What holds back the securities market in
Uzbekistan.
8.
Muxamedov, F., & Ibodullayev, A. (2025). Development of the securities
market in Uzbekistan: Improvement of the regulatory and legal framework and
digitalization trends. American Journal of Business Management, Economics and
Banking, 35, 18–23.
9.
Silk Capital. (n.d.). Capital Market Profile – Silk Capital. Retrieved from
[Silk Capital].
10.
UzDaily. (2024). Central Asian stock exchanges: Market overview in recent
years. Retrieved from [UzDaily].
11.
Wikipedia. (2025). Tashkent Stock Exchange. Retrieved from [Wikipedia].
