Uzbekistan’s Economy Poised for Continued Strong Growth Through 2027

The projections follow an exceptionally strong economic performance in 2025, when the economy grew by 7.7%, outperforming earlier expectations and reinforcing the country’s position as one of the fastest-growing economies in Central Asia.

The outlook is based on assumptions finalized in March 2026 amid heightened global uncertainty, including geopolitical tensions and disruptions linked to the conflict in the Middle East.

Broad-Based Economic Expansion

Economic growth in 2025 was supported by strong performance across all major sectors.

The services sector remained the primary engine of expansion, growing by 14.7% thanks to increased activity in trade, logistics, digital services, and tourism. Industrial output excluding construction rose by 6.8%, while construction activity surged by 14.2%, reflecting continued investment in housing, infrastructure, and urban development projects.

Agriculture also delivered positive results, expanding by 4.4% due to higher crop and livestock production.

“Uzbekistan enters the next two years from a position of strength, supported by resilient domestic demand, high levels of investment, and ongoing structural reforms,” said Kanokpan Lao-Araya, Country Director for Uzbekistan.

She noted that continued reforms and fiscal discipline have strengthened the economy’s resilience amid external uncertainties, while emphasizing the importance of transitioning toward more productive, private sector-led growth.

Domestic Demand and Investment Drive Momentum

Domestic demand remained the central pillar of economic growth in 2025.

Real household incomes increased by 9.2%, supporting stronger consumer spending and business activity. Overall investment rose by 10.5%, fueled by enterprise resources, household savings, and foreign direct investment.

Investment inflows were particularly strong in manufacturing, logistics, construction, and urban development, reflecting growing investor confidence and expanding economic opportunities.

Inflation Continues to Ease

The report also pointed to significant progress in reducing inflationary pressures.

Inflation declined to 7.3% in 2025 from 9.8% in 2024, supported by tight monetary policy, exchange rate appreciation, and easing production costs.

Inflation is expected to continue moderating, reaching 6.5% in 2026 and gradually converging toward the central bank’s medium-term target of 5% by 2027.

However, adjustments in administered energy prices and potential food supply disruptions could temporarily slow the pace of disinflation.

Fiscal Stability and Strong External Balances

Fiscal consolidation continued in 2025, with the budget deficit narrowing to 2.1% of GDP while maintaining social spending priorities.

Monetary policy remained tight to support inflation stabilization and strengthen market confidence.

Meanwhile, external balances improved as exports, tourism revenues, and remittances increased. International reserves also remained at comfortable levels, providing additional macroeconomic stability.

WTO Accession and Reforms Remain Key Priorities

The outlook identified economic transformation and structural reform as critical priorities for sustaining long-term growth.

Uzbekistan’s accession to the World Trade Organization (WTO) is expected to help accelerate reforms, improve competitiveness, diversify exports, and attract higher-quality foreign investment.

In addition, deeper reform of state-owned enterprises, regulatory modernization, and stronger market competition will be necessary to achieve productivity-driven growth over the medium term.

Risks and Opportunities Ahead

Despite the positive outlook, Uzbekistan still faces several external and domestic risks, including global financial volatility, trade uncertainty, and fiscal pressures linked to state-owned enterprises.

At the same time, continued reform momentum and prudent macroeconomic management are expected to strengthen the country’s resilience and long-term investment attractiveness.