Last month, Uzbekistan’s negotiators on accession to the World Trade Organization (WTO) proudly announced the completion of bilateral talks with Switzerland – the 25th WTO member state to give its blessing for Uzbekistan’s entry into the world’s foremost trading organization.
The Uzbek government has set a deadline of next year for joining the WTO. Accession would be a landmark moment for Central Asia’s most populous country, given that less than a decade ago, it was among the world’s most closed economies.
Uzbekistan originally applied to join the WTO in 1994 but quickly gave up on the process as then-President Islam Karimov (1991-2016) pursued a policy of extreme economic isolation. Under the mantra of “protecting domestic industry,” Karimov introduced debilitating import tariffs, export quotas, and licensing requirements that virtually excluded foreign firms from accessing the Uzbek market.
Things began to change after Karimov’s death in 2016 and the ascendency of his successor, Shavkat Mirziyoyev, to the presidency. A self-styled reformer, Mirziyoyev reopened WTO negotiations in 2020 and has made accession to the trading body one of the leitmotifs of his “New Uzbekistan” program – a broad brush commitment to open up Uzbekistan’s economy and society to the world following decades of isolation under Karimov.
Tashkent’s PR campaign around its WTO bid has been vocal. Mirziyoyev’s daughter and – as of this June – chief of staff, Saida Mirziyoyeva, has been leading communications efforts, pointing to several concrete steps taken by Tashkent toward accession in recent years. In January, a new presidential decree came into force, removing the monopoly rights of several state-owned enterprises. Since 2021, the government has amended the Customs Code over 100 times, primarily to reduce tariffs and customs duties. In January 2024, it lifted an obligation for imported consumer goods to include labels in the Uzbek language (albeit with some exceptions).
Nevertheless, while Tashkent claims to be in the “final stages of accession,” much work still remains. On the ground, businesspeople report that Karimov-era trade practices remain widespread, restricting foreign companies’ capacity to access the Uzbek market and Uzbek manufacturers’ ability to export their goods abroad. Import tariffs remain exorbitantly high, particularly on those goods that could challenge well-established state-run monopolies. For example, local press reports that tariffs and associated customs duties on cars can run as high as 120 to 150 percent of a vehicle’s price – a favorable status quo for local state-run automobile giant UzAuto.
Beyond tariffs, businesses also complain of other, more obscure barriers hindering imports and protecting local vested interests. These non-tariff barriers include Uzbekistan’s byzantine set of standardization and accreditation rules. Often, high-quality goods imported into Uzbekistan are impounded for months and subject to arbitrary and costly “testing” by Uzbek authorities. For example, since November, all cars imported into Uzbekistan must be sent to a “laboratory” 60 km south of Tashkent for “technical testing.” Uzbek media has reported queues of cars that last days, as the authorities test the same foreign models over and over again – despite many being manufactured to higher standards than those cars assembled locally.
Another surprising yet instructive example is imported refrigerators, which must undergo a myriad of state-mandated “hygiene tests” paid for by the importer. The consequence is that high-quality foreign fridges get stuck in customs for months. In April, Mirziyoyev signed a decree supposedly simplifying the certification process for imported refrigerators. However, local businesspeople claim it has changed little in practice. The testing creates a de facto trade barrier against foreign competition, shielding local manufacturers, notably white goods manufacturer Artel, which has been linked to influential ex-Tashkent Mayor Jahongir Artikhodjayev.
Another regulatory hurdle that has been riling up local businesses is the so-called “Asl Belgisi” digital labeling system. The system requires all medicines, household appliances, car parts, alcoholic and non-alcoholic drinks, and other goods to obtain special “digital labels,” ostensibly to minimize counterfeiting. However, businesspeople have complained about the added costs and the fact that there is only one authorized issuer of the labels – CRPT Turon LLC, which was founded as a subsidiary of USM Holding, owned by influential Russian-Uzbek businessman Alisher Usmanov (although his share in the venture reduced from 51 percent to 49 percent after Usmanov’s sanctioning in 2022).
Such non-tariff barriers run contrary to the core WTO principles of free trade and market competition. They may help explain why Tashkent has yet to conclude what are likely to be its most challenging bilateral accession talks — with the European Union, the world’s largest and most complex trading bloc. Talks with Russia, Uzbekistan’s second-largest trading partner, are also still outstanding. And while talks with the U.S. were formally completed in December 2024, they were with negotiators from then-U.S. President Joe Biden’s team. Given current U.S. President Donald Trump’s well-known antipathy to heavily state-backed economies’ inclusion in the WTO, it’s possible that the U.S. could reconsider its position on Uzbekistan’s accession.
Despite the difficult reality on the ground, political currents appear to be working in Tashkent’s favor. The WTO is currently experiencing a profound legitimacy crisis, prompted by Trump’s mass tariff threats and constant criticism of member-state China’s anti-WTO trade practices. Eager to prove its continued relevance to the world by attracting new members, the WTO could potentially overlook unimplemented reforms in Uzbekistan, paving the way for its accession next year.
In any case, WTO member or not, Uzbekistan will remain a tough nut to crack for foreign firms wanting to access Central Asia’s most populous and promising market.