UzA correspondent had a conversation with Cassandra Colbert, IFC Regional Manager for Central Asia.

Led by President Shavkat Mirziyoyev, Uzbekistan takes concrete measures to eradicate poverty and improve the living conditions of the population. 

A number of projects are being implemented based on public-private partnerships (PPP), a relatively new principle of economic growth for the country. The active participation of international financial institutions in this process helps to increase the effectiveness of this principle.

UzA correspondent had a conversation on this issue with Cassandra Colbert, IFC Regional Manager for Central Asia.

– As a member of the World Bank Group, our goal is to help end poverty in the world. We do that by supporting the development of private sector with both investments and advisory services.

I would like to underline that Uzbekistan is strategically important country for us. We are looking to invest in areas such as manufacturing, services, agribusiness and energy. In the financial sector, we will continue to focus on financial institutions that lend and lease to support small and medium-sized enterprises. 

We are also helping the government establish and develop a strong pipeline of PPPs. Along with other international financial institutions, we are also supporting the government’s privatization programs in the banking and chemical sectors.

Ultimately, I am a big believer in the future of Uzbekistan. The country has taken bold steps to remake its economy and create opportunities for its people.

– How does the International Finance Corporation participate in PPP projects implemented in Uzbekistan?

– Since 2018, International Finance Corporation together with the World Bank, contributes to the implementation of public-private partnership projects in Uzbekistan.

I’m referring to the plant coming up in the Navoi region. In October last year, Masdar Clean Energy of the United Arab Emirates was awarded the project with a bid to supply solar power at just 2.67 U.S. cents per kilowatt hour, one of the lowest tariffs in emerging markets. The PPP, tendered under the World Bank Group’s Scaling Solar program, will soon add 100 MW of clean, renewable energy to the country’s energy mix. 

And that’s not all – we are particularly delighted that, given the successful outcome of the first tender, the government of Uzbekistan, with IFC’s support, launched another tender for an additional PPP for 400 MW, followed by more PPPs for a total of 1000 MW of solar power. 

I would like to mention one more very important project. We are helping the government structure a transparent and competitive tender process for the PPP to develop a 1,200 - 1,500 MW gas-fired power plant in Syrdarya region. This large-scale PPP will help modernize Uzbekistan's aging power infrastructure and provide both residents and businesses with a steady supply of electricity. 

Uzbekistan has ample natural gas reserves and gas-fired power plants are crucial to regulate the power grid. This, in turn, will enable increased penetration of intermittent renewable-energy sources, such as wind and solar. Modern and highly-efficient CCGT plants will reduce in half the use of gas, when compared to existing gas-fired plants. Not to mention that this will significantly reduce GHG emissions. 

We got together with the Ministry of Energy, Ministry of Investment and Foreign Trade, and the PPP Development Agency to organize an online investor conference recently. It brought together more than 100 participants, including investors, financial institutions, and other stakeholders, who were familiarised with the project’s scope and transaction structure, Uzbekistan’s power sector, and its PPP regulatory framework. The goal is to attract leading investors of the world to the tender, which is expected to be transparent and competitive.

– What do you think about PPP’s promising aspects?

– PPP has plenty of advantages; but the most important one is that it allows governments to leverage private capital and expertise in a transparent and competitive fashion for the public good. This is key in situations where public funding is scarce.

The public sector often lags behind in funding, technology, skills, and efficiency. PPPs can help expand key services and complement traditional public-sector approaches with various forms of private-sector participation. 

When designed well and implemented in a balanced regulatory environment, PPPs can increase efficiency and sustainability to the provision of public services and attract foreign direct investment. But, I must state a caveat: PPPs must be tailored to local contexts and our job is to work with governments and development partners to find the right solutions that work for that country and its future.