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Exclusive interview with Deputy Prime Minister of Uzbekistan Aziz Abdukhakimov

Author:

15.07.2019

We met with Deputy Prime Minister of Uzbekistan Aziz Abdukhakimov last year in Tashkent at the opening of the 24th International Exhibition Tourism Along the Silk Road. He then told us many interesting things about the reforms in the tourism sector of Uzbekistan, as well as about plans to share experiences and to cooperate with Azerbaijan in this area. Recently, we again had an opportunity to talk with Mr. Abdukhakimov and learn about the implementation of planned large-scale reforms. Our meeting was in Baku during the 43rd session of the UNESCO World Heritage Committee. 

"Can you describe the current level of our relations? How much do they suit our interests?"

"I must admit that Uzbekistan is very fond of Azerbaijan. We treat Azerbaijan as a close and fraternal country. We have a common history, language, religion. We are parts of the common Turkic world. It is very important. It is also important that close and fraternal relations have developed between the leaders of our countries. That is why we should engage in mutual cooperation, develop our economic, cultural and humanitarian ties. Potential for this is great.

Azerbaijan is a key Caucasian country for Uzbekistan. Today we have many interesting and ongoing joint projects.

We also have a joint intergovernmental commission on cooperation. Currently we are preparing for the 11th meeting of the commission. You know that last year our Prime Minister visited the opening of the Baku-Tbilisi-Kars railway, which gave a very serious impetus to our relations."

"Can you compare the current indicators of mutual cooperation with existing opportunities?"

"The volume of mutual trade is growing. In 2018, trade between Azerbaijan and Uzbekistan increased by 46.5%. During the first four months of 2019, our trade turnover increased by another 45%, compared to the same period of 2018. This is a very positive trend.

Uzbekistan has more than 80 enterprises with the participation of Azerbaijani investments, including 70 joint enterprises. They operate in areas such as trade, engineering, metal processing, finance, energy, food and light industry, ICT, etc.

Representative offices of a number of Uzbek companies also operate in Azerbaijan, such as Uzbek Airlines, Uzavtoprom AK - Ravon (automobile manufacturer), Artel company, which produces electrical products.

We also develop cultural and humanitarian cooperation in science, education and sports. At the same time, existing indicators do not reflect the real potential of our countries. That is why we have established active contacts between the businessmen of Uzbekistan and Azerbaijan. We are working on creating new joint ventures and the opening of the Uzbekistan Chamber of Commerce in Azerbaijan.

We also work on the establishment of the Business Council of Uzbekistan and Azerbaijan. This is also a very important platform. The first meeting of the council will be held in Baku this year.

I am sure that Uzbekistan and Azerbaijan can get significant dividends by focusing their efforts on cooperation in transport and communications. Transportation routes from Central Asia through the Caspian Sea and further through the Caucasus are of particular relevance."

"As far as I know this is your first visit to Baku. How do you like our capital city?"

"Yes, this is my first time in Baku and I like it very much here. I have been to 46 countries so far. I really liked Azerbaijan, and I am going to recommend it to all my friends. A little more than two hours of flight, and you find yourself in a country with excellent cuisine, sea, historical centres and, most importantly, wonderful people. There are no barriers between us - we can speak Uzbek, and Azerbaijanis understand us perfectly. I think we need to make a new tradition making weekend visits to Azerbaijan and Uzbekistan.

We can start special programs. We can, for example, negotiate with travel agencies in Azerbaijan and provide them with discounts. We have practiced this before."

"You do not rule out the possibility of cooperation with Azerbaijan as part of a joint tourist product, Modern Silk Road Tour, which has been negotiated between Uzbekistan and Kazakhstan. What is the progress in this regard?"

"We are actively promoting this project. We have already signed an intergovernmental agreement with Kazakhstan on the implementation of the so-called Silk Visa zone. As a first step, we have unified visa regimes of our countries and the lists of visa-free countries.

At the same time, our law enforcement agencies, special services, customs and tourism agencies are working on solving technical issues. You will need to fill in a single electronic form to visit Uzbekistan without a visa and then you can continue your trip to Kazakhstan without worrying about visa. Azerbaijan has extensive experience in introducing e-visa, and in the future, it will be possible to think about cooperation on this project as well.

During my visit, we discussed this issue with Vice Prime Minister Ali Akhmedov and Chairman of the State Agency for Tourism Fuad Naghiyev. There is a huge interest, and I believe that as we get involved, opportunities will emerge for organizing joint tourism products. I think if there is a desire and a corresponding political decision from the Azerbaijani side, we can start the negotiation process. In the meantime, it will be much faster to develop this project between our countries so that others can join it later."

"Joint tourism products are increasingly popular these days. Both Azerbaijan and Uzbekistan are undergoing major reforms in the tourism sector..."

"You are absolutely right. Thanks to the initiative of our president, Uzbekistan has opened up to the world. I think Uzbekistan is already in the second place in terms of visa liberalization after Georgia: 110 countries with visa-free regime in Georgia and 65 in Uzbekistan. Another 77 countries are covered by electronic visas.

On the other hand, we see how a guest accommodation system is developed in Azerbaijan, including many new hotels, inns and hostels. We also have drastically simplified the conditions for opening hostels: 28 prerequisites before and only 6-7 conditions that must be met now to ensure the safety of guests and the quality of services.

Due to increasing demand to create hostels in remote mountainous areas, we have maximally simplified the conditions on this issue. Now the procedure it is very simple - within a few days a village house is decorated in national style, its bathroom is brought into conformity with standards, its kitchen is equipped with air conditioning, etc. Government also provides a microcredit to the owner of the house, and the family learns basic English for several weeks, guest services and the provision of additional services, such as visiting local artisans, riding to the mountains on horseback, hiking to a mountain river, a waterfall, cooking together fresh dishes. In a word, everything that will allow the tourist to feel the traditional Uzbek life.

"What other preferences does the government of Uzbekistan introduce to attract investment in the tourism sector?"

"There are many preferences. For example, thanks to our president, investors' expenses for the construction of hotels are covered from the state budget. On average it is a little less than $4,000 for a room in a three-star hotel and about $8,000 for a single bed room at a four-star hotel. Based on world practice, and taking into account the low construction costs in Uzbekistan, construction of a room in a three-star hotel costs $20-25,000, depending on the region, a little more expensive in a four-star hotel, which is $35-45,000 on average. So, 20-25% of the costs for the construction of hotel is covered from the budget. In total, $100 million is reserved in the state budget for the construction of additional 50,000 rooms."

"Do you also provide temporary tax exemptions for investors?"

"Yes, depending on the size of the investment, they can be exempt for a period of 3 to 10 years. This is very beneficial to investors. We have a hotel boom in Uzbekistan now. But most importantly, in order to improve the quality of tourist services, we also have introduced a mechanism to compensate for a portion of the investor’s expenditures on attracting foreign franchises. The main thing is that it should be a three-star and four-star brand , the ones that Uzbekistan needs the most. State covers the cost of a foreign franchise at a rate of $200 per room in a three-star and $400 in a four-star hotel. This is an unprecedented preference, and specific funds are already provided to cover these costs. In other words, we encourage well-known global brands, because these networks have their own standards of service."

"What can you tell about Azerbaijani investments in the tourism sector of Uzbekistan? Any specific plans?"

"As the first stage, Azerbaijani companies are very active in our tourism market, which offer joint products to tourists from European and Arab countries. I think that a big problem is the lack of awareness of Azerbaijani investors. I hope that thanks to the support of media, including Region Plus, investors from Azerbaijan will learn about Uzbekistan's potential."

"How much money does an average tourist need to visit Uzbekistan?"

"We calculate expenses of a single tourist according to the standards of the World Tourism Organization. On average, guests from neighbouring countries of Central Asia leave in Uzbekistan for 3-5 days $ 100-120, since they, as a rule, stay with relatives and friends. Tourists from the rest of the CIS countries, say from Azerbaijan, who stay in hotels and guest houses, spend about $420-430 on a trip to Uzbekistan, including flights. Visitors from foreign countries visit and stay in Uzbekistan for 3-5 days spending $750 on average. It all depends on tastes and needs. In fact, traveling to Uzbekistan is cheap.

In Uzbekistan, you can find a good hotel for $30-40 per day. We have very cheap food, which will cost you no more than $10 a day. Public transport fares within the country are also very affordable.

A round-trip flight on board Azerbaijan Airlines will cost you $200-250. If earlier there were only two flights a week between Baku and Tashkent, now their frequency has grown to five flights. This is a good result, given that prices are consistently reduced.

As a result, if in 2016 only 2.5 thousand people from Azerbaijan visited Uzbekistan, then in 2018 already four times as many, and the number of tourists reached about 11 thousand people. Dynamics are very good, and I think this year the statistics should double, or even triple. But it still does not meet our potential. Therefore, we agreed with Mr. Deputy Prime Minister that we will develop a roadmap of cultural and humanitarian cooperation, which will also include the exchange of airtime between state television channels and the exchange of billboards on the streets of major cities."

"As far as I know, President Shavkat Mirziyoyev has set a goal to bring the number of tourists visiting Uzbekistan to 5 million annually by 2020..."

"Not exactly. In 2016, the number of tourists was 1.3 million people. In 2017, this number reached 2.7 million. Last year, the number of guests visiting our country doubled again and already reached 5.4 million people. According to preliminary calculations, this year the number of tourists will reach 6.9 million, and perhaps even exceed 7 million. The country's leadership has set a strategic task to bring the number of visitors to 10 million people by 2023. We are actively working in this direction in order to promote our country."

"What exactly are you doing?"

“In particular, we have established an institution called Tourist Ambassadors of Uzbekistan in other countries, who are chosen from public leaders and celebrities of various countries. We also asked the government of Azerbaijan to recommend us a tourist ambassador to your country.

We started advertising for Uzbekistan in the Premier League. We are currently negotiating the placement of patch advertising on major tennis competitions including such world stars Rafael Nadal and the Williams sisters.

In addition, at the end of this year Uzbekistan for the first time will host an international congress of influencers. The event will gather 100 of the world's most advanced bloggers, vloggers, owners of pages in social networks with more than 1 billion subscribers and more than 10 billion regular views. They will promote Uzbekistan in social networks. This will be a unique, new approach for the promotion of the country.

We also set a goal to transform Uzbekistan into a country of festivals. In addition to the annual three or four major international festivals, there will also be many regional festivals, depending on their characteristics. In Bukhara, for example, this is a silk and spice festival, a dance festival in Khorezm, a mugham festival in Shakhrisabs, Oriental melodies festival in Samarkand, a festival of craftsmen in Takand, etc."

"We wish you success with your reforms, Mr. Deputy Prime Minister. Thanks for the interview."



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