Does a remote double-landlocked Commonwealth of Independent States country have the potential to grow at 8 percent a year for the next 20 years? Call me an optimist, but I have just been to the country and I am convinced it’s true. My lecture to a packed audience in Tashkent on ‘Uzbekistan: New Strategies and Opportunities for Structural Transformation’ was well received. Perhaps they were just being extraordinarily polite hosts, but officials there thought my visit marked a transformation point and at the end of my visit, they said they’d start working on a long-term development vision report together with the World Bank and their think tanks.
The recipe for dynamic growth in a developing country is to tap into latecomer’s advantages by developing industries in accordance with its comparative advantages in a well-functioning market economy with the state playing a facilitating role. In the case of Uzbekistan, the potential of late comer advantages have been enormous in many sectors including the traditional ones, such as carpet, garment and horticulture, and modern ones, such as consumer electronics and cars. I visited a carpet factory in Samarkand. Impressed by the owner’s entrepreneurship and the abundant supply of well-educated, disciplined, wage-competitive workers, I am convinced Uzbekistan can out compete Turkey as the world’s production center of synthetic carpets in the coming years.
During my talk in Tashkent, I made the case that Uzbekistan is well positioned to use a growth identification and facilitation framework to accelerate its industrial upgrading and diversification. I hope you will check out the powerpoint I presented there and provide feedback on applying new structural economics in Central Asia and elsewhere.
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