The role of government in the economy is specified in its functions. All functions of the state in a transition economy associated with the formation and development of market relations. Depending on the nature of the communication, you can select a function to create the conditions of existence of an efficient market and to supplement the functions and adjusting the actual action of market regulators. The first group includes software the legal framework of functioning market economy, as well as the promotion and protection of competition as the main driving force in the market environment. The second group included the redistribution of income, adjustment of resource allocation, to ensure economic stability and stimulate economic growth. These features are characteristic of transition and developed market economy. However, the transition to the market implementation of each of them characterized by features. If the established market economy legal framework of economic performance is realized mainly by controlling the application of the existing legislation and economic inclusion in his partial adjustments, the transition is necessary to re-create the legal basis of management, which should clearly define property rights and contract compliance, to regulate the activities of developing institutions of a market economy (Commercial banks, stock exchanges, investment funds, etc.), contain the legal framework of anti-monopoly regulation. Adequate market conditions, tax law, a system of laws for the protection of consumers' rights and social security, and more. Moreover, it requires legal support for such a specific process transitional period, as the privatization of state property. The transition from a planned economy to a market objective is accompanied by a sharp increase in income differentiation, and in the beginning of the transition process takes place against the backdrop of the economic downturn and high inflation, which exacerbates the problem of inequality, causing a significant reduction in the standard of living of the general population. In these circumstances, to smooth the acuteness of the social and economic contradictions and prevent the impoverishment of certain social strata, the state has to actively participate in the redistribution income.
The redistribution of resources and the production of public goods (National defense, fundamental science, education, health, etc.) are compounded by high inflation in a transition economy, from which most affected people with relatively stable nominal income (as a rule, employees of budgetary branches). It starts the flow of qualified scientific and pedagogical staff in the scope of activities that generate higher revenues. In order to save human resources in vital for the development of society areas, an indispensable element of resource redistribution policies transition should be an effective system of income protection public sector employees against inflation.
On 14 January, an extended session of the Cabinet of Ministers, dedicated to comprehensive analysis of the results of social-economic development of the country in 2016 and determining the most important directions and priorities of economic and social program of the government in 2017 was held in Tashkent.
President of the Republic of Uzbekistan Shavkat Mirziyoyev delivered a keynote speech at the session. In his speech, the President underlined that the continuity in consistent implementation of the Uzbek model of development and Program of further reforms, structural transformations and modernization of the country, developed under the leadership of First President of the Republic of Uzbekistan Islam Karimov, ensured maintenance of stable and sustainably high rates of economic growth and macroeconomic balance, increase of the level and quality of life of the population. During the discussion of the issues, included into the agenda of the meeting of the Cabinet of Ministers, it was highlighted that the gross domestic product of the country increased by 7,8 % in 2016. The volume of industrial production grew by 6.6 %, contractual construction works –12.5 %, retail trade — 14.4 % and services — 12.5 %. The State Budget was executed with a surplus at 0,1 % to GDP. The surplus in foreign trade turnover has been secured. The inflation rate has not exceeded forecast parameters and constituted 5,7 %.
Over 16,6 billion US dollars or 9,6 % more than in 2015 were invested into the economy. The volume of foreign investments and loans increased by 11,3 % and exceeded 3,7 billion US dollars. The realization of 164 large investment projects with a total cost of 5,2 billion US dollars were completed, including production of new T-250 car model at GM Uzbekistan JSC, enhancement of the cement plant in Djizak region, construction of two steam-gas installations with a total capacity of 900 MWt at the Talimarjan power plant and energy block of burning high-ash coal with a capacity of 150MWt at the Angren power plant. A new Angren-Pap electrified railway line was constructed with a unique 19 km long tunnel through Qamchiq mountain pass, which connected Fergana valley regions with other regions of the country through a reliable transport link. Afrosiyob high-speed passenger trains started to travel from Tashkent to Bukhara. The program measures on modernisation and diversification of agriculture under implementation ensured the growth of agricultural output by 6,6 %, including of fruits and vegetables — 11,2 %, potatoes – 9,7 %, melons – 10,5 %. The measures on comprehensive support and protection of private property and entrepreneurship contributed to creation of around 32 thousand new small businesses in 2016, or 18 % more than in 2015. The small businesses’ share in GDP of the country increased to 56,9 %, and in industry to 45 %. Thanks to positive structural transformations and high rates of economic growth the real income of population increased by 11 %. The salaries of workers of the budget organizations was raised by 15 %, pensions and social benefits — 12,1 %. Around 726 thousand people have been newly employed, including 438,5 thousand graduates of educational institutions. Within the framework of the State program “Year of healthy mother and child” a wide complex of measures on strengthening healthcare of mothers and children, formation of healthy and harmonically developed generation was implemented, for funding of which over 8 trillion soums and 212 million US dollars were directed.
The President of the country, analysing in detail and comprehensively the existing unsolved problems and partial utilization of reserves, explicated his proposals on key strategic tasks and important priorities of economic and social program of the country for 2017. Among priority tasks, a central role is attached to development of permanent, open dialogue with population within the framework of implementing the State program «Year of dialogue with people and human interests», continuation of active social policy, directed towards further improving the level and quality of population, their material welfare. The government, heads of ministers, agencies, business associations and local governance bodies were assigned concrete tasks on eliminating the shortcomings in the development of the spheres and territories, as well as development and realization of the complex of measures, on continuing active investment policy, strengthening protection of rights and interests of entrepreneurs, gradual decrease of the role of state in managing the economy and cardinal improvement of the work of the governmental bodies. The president underlined the most important tasks and measures on realization of newly adopted targeted programs on construction of affordable housing, development and modernization of road-transport, engineering-communications and social infrastructure, ensuring improvement of the quality of life of the population in city and rural areas.
For admitted failures, deficiencies, and lack of initiative, some officials were warned of personal responsibility for quick elimination of shortcomings, as well as ensuring the effective implementation of the tasks for the further intensive development of industries and regions of the country. The President of the country laid the following priority tasks and requirements before the government, heads of ministries, agencies, business associations and khokimiyats:
− first — development of complex measures on eleven priorities of economic and social program for 2017;
− second– ensuring critical analysis of state of affairs in the spheres of the economy, social sphere and regions of the country on a systemic basis, making amendments on this basis to main directions and priorities of deepening the economic reforms;
− third– increasing personal responsibility of the heads and senior officials for end results, their compliance with strict discipline and strengthening effectiveness of the management system in accordance with increased modern requirements.
Following the discussions, a governmental decision was adopted, which determines the practical measures on ensuring implementation of most important directions and priorities of the program of social-economic development of the country for 2017.
The purpose of the strategy designed for 2017–2021 years — a radical increase in the efficiency of the reforms, the creation of conditions to ensure the full and accelerated development of the state and society, the implementation of the priority areas for the country's modernization and liberalization of all spheres of life. As noted in the document, a comprehensive analysis of Uzbekistan passed stage of independent development, as well as the changing conditions of the world economy in the context of globalization requires the development and implementation of the «radically new ideas and principles of the future sustainable and advanced development of the country».
The strategy includes five priority areas:
- Perfection of state and social construction, aimed at further strengthening the role of Parliament in deepening democratic reforms and modernization of the country, development of the institutional framework of public administration and public services, deregulation, the widespread introduction of the system of public services on the principle of «single window» further the implementation of mechanisms of public control and strengthening the role of civil society institutions and the media;
- Ensuring the rule of law and reform of the judicial system, aimed at strengthening the real independence of the judiciary and guarantees protection of the rights and freedoms of citizens, improving citizens' access to justice, improving crime counteraction system and crime prevention, the full realization of the adversarial principle in the trial, the improvement of system of legal aid and legal services;
- The development and liberalization of the economy, aimed at increasing its competitiveness and openness, freedom of economic activity, strengthening of macroeconomic stability and the preservation of economic growth, modernization and active diversification of the leading sectors of the economy, a radical reform of the financial and banking sector, all-round protection of private property and entrepreneurship, expansion foreign economic relations, actively attract foreign investment, effective development of tourism, the implementation of structural changes in agriculture;
- The development of the social sphere, aimed at gradual increase in wages, pensions and benefits, an effective solution to the issues of employment, providing citizens with affordable modern housing, modernization of housing and utilities, social infrastructure, improving social welfare and health care, education and science, state youth policy;
- Ensuring security, inter-ethnic harmony and religious tolerance, the implementation of balanced, mutually beneficial and constructive foreign policy aimed at strengthening the independence and sovereignty of the state, creating a security belt around Uzbekistan, stability and good neighborly relations, the promotion of a positive image of the country abroad.
The project is proposed to form a National Commission for the implementation of the Action Strategy for the five priority areas of the Republic of Uzbekistan in 2017–2021, respectively, as well as the Commission on the implementation of the selected priority areas. The strategy will be implemented in five phases, each of which provides for approval of a separate annual State for its implementation of the program in accordance with the declared name of the year.
