The impact of the coronavirus pandemic on the
business enterprises in Uzbekistan
July 15, 2020, Tashkent. In June
2020, the Center for Economic Research and Reforms (CERR), with the support
of the United Nations Development Program in Uzbekistan (UNDP), conducted a
survey of enterprises on the impact of the pandemic and the government’s
The quarantine measures undertaken
by the Government of the Republic of Uzbekistan influenced both the
country's economy as a whole and individual enterprises. Despite the
introduction of a package of measures to support the business community,
companies continue to experience significant impact in connection with the
The study, initiated by CERR with the support of UNDP, conducted interviews
with entrepreneurs about the impact of the spread of COVID-19, and the
preventive measures introduced by the Government on small and medium-sized
The aim of the study was to analyze the impact of the spread of COVID-19 and
related preventive measures on enterprises as well as the assessment of the
needs of enterprises in further external support.
The survey involved 887 business managers from 14 regions of the republic
aged 18 to 79, of whom the vast majority (79%) were men. On the same token,
women-managers of organizations accounted for a fifth of the total number of
The analysis showed that the majority of organizations did not stop their
business operations amid the COVID-19 pandemic and quarantine measures.
Employees mainly continued their work. Layoffs were rarely practiced.
Among the sectors of the economy, the most affected was the sector of
housing (hotel business) and food services. In matters of personnel
management, this area is characterized by a massive suspension of activity,
the inability to transfer work to a remote format, frequent sending on
vacation (especially unpaid), and layoffs, reduction of salaries and
The least affected sector is agriculture, forestry and fisheries. Here,
mainly, the continuation of work and the preservation or even increase in
wages were observed. Demand for agricultural products remained at the same
level. Among indicated problems, there were only moderate difficulties in
accessing sales markets.
The impact of the pandemic on the business operations. The survey showed
that the vast majority of respondents (78%) indicated that their
organization continued to conduct business operations in the context of
introduced preventive measures related to the pandemic.
For reference: the highest proportion of organizations that stopped business
operations during the quarantine period were in Tashkent (31%) and in the
Republic of Karakalpakstan (31%).
In all sectors, the share of entrepreneurs, which reported the continuation
of operations in epidemic conditions, is at least 65%, the only exception
being housing and food services (30%).
The most popular answer among enterprises to the question of changes in the
level of demand for goods and services over the past 30 days is that the
demand remained unchanged (35%), while only 24% of respondents indicated a
decline in demand.
For reference: the highest rates regarding the significant decrease in
demand were noted in the Namangan region (38%), the Republic of
Karakalpakstan (35%), and the city of Tashkent (41%).
The largest drop in demand was observed in the housing and food services
Actions taken by enterprises during the spread of coronavirus infection
On the issue of changes in the organizational policy of enterprises
regarding suppliers during the pandemic, a significant number of respondents
(55%) did not note any changes. However, 7-8% of enterprises indicated a
search for new suppliers and agreements on fewer acquisitions.
For reference: the most frequent values of the answer “has not changed” were
observed in the field of transportation and storage - 68%. In the sphere of
housing and food services - 16% of enterprises declared the suspension of
In the direction of reducing business expenses after the introduction of
COVID-19 related measures, 67% of enterprises replied that there were no
changes. Only 1% of respondents ceased operations and applied for subsidies
For reference: the absence of any changes to the question of reduction in
business expenses, quite often, was chosen by representatives of small and
medium-sized businesses from the sectors of agriculture, forestry and
fisheries (85%) and information and communications (80%). For the sector of
housing and food services, the indicator was only 48%.
59% of the total number of respondents indicated the absence of any changes
to the question of changes in the business operations regarding sales
markets after the introduction of measures related to the pandemic. However,
7-8% of participants said they agreed with customers about delays in
delivery times and decline in prices for goods and services.
A significant number of small and medium-sized businesses (64%) have not
changed their business development plans since the beginning of the
pandemic. Only 5-6% of enterprises started the development of new forms of
doing business and accelerated the development of new types of goods and
Assessment of government business relief measures
The group of effective measures includes a significant decline (by 20-50%)
in interest rates on short-term loans (up to 1 year), reduction of rents for
state assets for the required period, decrease in social deductions and
taxes on labor income for the required period, VAT and excise tax reductions
for the required period. The list is also complemented by subsidies and
grants to support businesses and lump sum payments of social assistance (5
million soums each) to employees of companies.
A package of relatively effective measures consists of credit payment and
tax holidays, extension of state guarantees (all for a period of 1 year),
raising import tariffs and tax breaks for employees.
Credit payment and tax holidays in the transportation and storage sector are
considered to be ineffective according to the perception of some
Necessary measures to support enterprises
When asked about the measures that are most needed to support enterprises,
entrepreneurs most frequently noted tax deductions (42%) and interest rate
declines on loans (38%). Next options were deferral of taxes and fees (24%),
and deferral of loan payments (19%). Only 6.5% of entrepreneurs stated that
their companies do not need any type of support.
Respondents showed a very high level of confidence in the further
development of their enterprises.
CERR Public Relations Service