April 24, 2014
Maximum Effect

Singapore, a city-state, has for many years amazed experts, financial analysts and economists for not only its exceptional ability to adapt to any conditions, but also its willingness to make the most of even the smallest of these opportunities. A state whose territory makes up as few as 715 sq. km, is today one of leading nations in Asiaas much as the world in terms of competitiveness and economic efficiency. These achievements have been possible due to the hard work, since as recently as half a century ago the country had just made it on the rails of an industrial progress.

A great path undertaken by Singapore to develop its economic model is largely symmetrical to that made by Uzbekistan for more than twenty years. Modernization, innovation, IT, investments - these are the landmarks that guide both countries in an effort to take up a rightful place on the global economic map of the world. And Uzbekistan can learn much from the country that for years ranked first in the World Bank rating “Doing Business”.

Singapore is one of the so-called four Asian tigers or four Asian small dragons, that is, the countries that have achieved outstanding success in building innovative economies. The nation earnedanother informal title – that of an “Asian economic miracle of 20th century”, because just in a few decades the country evolved from an emerging economy into one of the most highly advanced ones. Interestingly, Singapore and Uzbekistan have just another trait in common, and that is interlacing of cultures and ethnicities, a unique fusion at the junction of Asia, the East and Europe. Countries have policies aimed at maintaining interfaith harmony, development of tolerance and accord among people of different ethnicities and religious groups.

Thus, what is Singapore like today and where are the points of contact allowing for the promotion of cooperation with our country? Its economic development strategy allowed for a short time to turn this “Asian Tiger” into a financial and commercial center of Southeast Asia. Singapore took a firm place among the industrialized nations, becoming one of the leaders in high-tech sectors such as electronic and electrical industry. It enjoys a leading position in Southeast Asia in the production of electronic components, precision instruments and computers. It is the development of this cooperation area that our two countries have been placing a special emphasis on. In the near future, Uzbekistan will enter a new line in the development of its high-tech industry; the country will launch theproduction of personal computers. A partner in this project is a Singaporean company Prescient Systems & Technologies Pte., Ltd. Following several meetings and negotiations, the Uzeltekhsanoat Joint-Stock Company and the Singaporean side have reached a preliminary agreement on a joint scheme. The feasibility study of the project is already prepared.. The production is planned to be placed in the Sirdaryo region of Uzbekistan. This is due to the favorable geographical and transit position of the region, the availability of a necessary transport and engineering infrastructure and human resources. There is already an active branch of the SIZ Jizzakh, where the Chinese ZTE launched the assembly of mobile phones. The parties now continue negotiations on the implementation of the necessary pre-work, as well as the signing of the relevant bilateral agreements. Total project cost is valued at US$8.4m. After reaching the projected capacities, the factory is to produce up to 100,000 computers a year.

In the high-tech segment operates an Uzbek-Singaporean Joint Venture CFM ProEnergies specializing in the production of LED lamps and lighting. The enterprise is located in FIEZ Navoi, manufacturing brand new artificial light sources, using LED as a light source. These lamps have the highest energy efficiency even with respect to fluorescent lamps, the production of which is being actively developed in Uzbekistan. Moreover, the new generation of high strength lamp to be more durable and environmentally friendly because it does not contain toxic substances and therefore do not require special disposal. In the FIEZ, production of 17 kinds of lighting fixtures and bulbs has already been introduced.

However, perhaps the largest and brightest example of the bilateral cooperation can be called the projects of Singapore’s Indorama Group in Uzbekistan. The company operates in two industries strategically important for our republic - hydrocarbon and textile sectors. In particular since 2011, a project is underway on the construction of gas chemical complex on Unitary Subsidiary Enterprise “Muborak Gas Processing Plant” valued at over US$1.6b. The facility is expected to be commissioned in 2016. After reaching the design capacity it will produce up to 492 thousand tons of polyethylene, 66 thousand tons of gas condensate and 53 tons pyrolysis gasoline.

A Project of the company in the textile industry has long proved correctness of the decision to invest in the economy of Uzbekistan. In 2010, the country had established a joint venture Indorama Kokand Textile, and a year later started one of the most modern factories for the production of cotton yarn cost US$55m. Its capacity is up to seven thousand tons per year. Over 85% of the yarn is exported to Germany, Spain, Belgium, France, Argentina, Brazil, Turkey, Bangladesh and other countries. Earlier this year, a new step was made in development of the company – a third stage of development of the plant has been started, in which an investor was expected to assign additional funds in the amount of US$20m in the expansion of spinning with the creation of 100 additional jobs. To note, the total investment of Indorama Group to Uzbekistan’s textile industry has exceeded US$90m. The company Verigrow successfully operates in this segment, too. In 2012, the Singaporean side bought a dormant industrial complex and organized a modern enterprise, Verigrow Ipagi, specializing in silk production. In restoration activities over US$5m have been invested, and more than half of this amount went to the purchase of new equipment and technology, modernization and technological re-equipment. Today, the company employs 180 people. Last year it produced goods worth more than one billion soums, 80% of which went for export. A new stage of capacity expansion continues, there is an installation of the equipment ongoing. After its run, the production will increase by 70%, being able to annually produce for UZS2 billion and creating 60 new jobs.

Another interesting area of cooperation is tourism. There is a growing flow of visitors from Singapore to our country, especially in cognitive and pilgrim tourism.

Overall, last year the volume of the bilateral trade between our nations totaled US$47.6m. Experts note that this is low enough not only for the available potential, but already achieved results of previous years. For example, in 2012 the trade turnover exceeded US$107m. Therefore, the parties plan to soon significantly enhance communication, especially between business representatives. Today 33 Uzbek-Singaporean joint ventures operate in Uzbekistan, including seven purely foreign enterprises. In the near future there may be an order of magnitude more. This was discussed at a joint business forum and cooperation exchange held in late March in Tashkent. Many Singaporean businessmen expressed their interest in creation of new capacities in special industrial zones Navoi, Angren and Jizzak. Especially so if one takes into account that there are already successful examples of an effective use of Singaporean investments. Both countries have demonstrated not only a desire to go a joint course, but also to jointly develop quite complex technology projects, to create a unique capacity for deep processing of raw materials. This commitment in the near future will allow Uzbekistan and Singapore to bring trade to a higher level.

(Source: “Uzbekistan Today” newspaper)


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