meeting of the Council of the Supreme Assembly [parliament] of the Republic of Uzbekistan was held July 28. The meeting was chaired by the chairman of the Supreme Assembly, Erkin Khalilov.

The Council passed a resolution to convene the third session of the Supreme Assembly of the Republic of Uzbekistan of the second convocation on 30th August 2000.

The following issues are expected to be submitted for consideration at the third session:

On the implementation of the state budget of the Republic of Uzbekistan in the first six months of 2000

On the draft law on the budget system - first reading

On the draft law on nationwide discussions of draft laws - first reading

On the draft law on norm-setting and legal documents - first reading

On the draft law on courts - new edition

On the draft law on plant protection

On the draft law on postal communications

On the draft law on radiation safety

On the draft law on combatting terrorism

On the draft law on psychiatric assistance.

In addition to these issues it is expected that others which fall within the competence of the Supreme Assembly will be included on the agenda for the consideration of deputies.

he government of Uzbekistan has asked Russia to assist immediately in extinguishing a fire which has broken out at a chemical combine in the town of Karshi [400 km southwest of Tashkent]. An ITAR-TASS correspondent was informed of this today by the press service of the Russian Emergencies Ministry.

The fire at the chemical combine in Karshi broke out at 2340 hours Moscow time on Thursday [1940 gmt 27th July]. The fire quickly spread to four reservoirs, each holding 5-10,000 tonnes of gas condensate. One of the reservoirs has exploded. An Il-76TD aircraft, which is specially equipped for fire-fighting, is now preparing to leave for Uzbekistan.

resident Islam Karimov of the Republic of Uzbekistan left for the town of Karshi [the capital of southern Kashkadarya Region] in the morning of July 28 to take part in an extraordinary session of the Kashkadarya Regional Council of People's Deputies.

zbekistan recently bought a replacement cargo of 12,500 tonnes of white sugar for nearby shipment, traders said on Thursday.

Pricing details were not disclosed. They said ED & F Man had won a snap tender called after another company failed to deliver on a previous tender because a letter of credit had not been opened in time and prices had meanwhile risen by some $40 a tonne. In May, Uzbekistan bought four 12,500-tonne cargoes of white sugar at between $272 and $282 a tonne, delivered at frontier (DAF) from June onwards.

he head of the IMF mission, Christoph Rosenberg and the head of the World Bank mission, David Pearce, chaired a news conference at the UN office in Uzbekistan at which the issues of convertibility, the inflow of foreign currency and inflation were discussed, the Uzbek newspaper 'Pravda Vostoka' reported on 5th July. The existaence of three exchange rates - official, black market and commercial - frightened off foreign investors, the newspaper said and added that, according to an optimistic forecast, Uzbekistan would shift to the convertibility of current payments in six months and, according to a pessimistic forecast, in a year.

The Uzbeks favoured expanding exports and clear economic mechanisms, since the 1996 restrictions to regulate the flow of foreign currency had not lived up to expectations, the newspaper said. As for inflation, Rosenberg said that a tough monetary policy was needed in order to curb inflation. Pearce said that direct foreign investment was not enough for Uzbekistan if one looks at direct foreign investment and foreign investors separately. The World Bank had completed some projects and is to carry out more between 2003 and 2005 in Uzbekistan, the newspaper said. The following are excerpts from the newspaper article:

The first news conference, similar to a series of meetings promised for the future, which was held at the UN office in Uzbekistan, served to confirm the forthcoming "transparency". The heads of these two UN financial agencies [the IMF and the World Bank] answered journalists' questions for two hours.

First, however, Christoph Rosenberg [the head of the IMF mission in Uzbekistan] and David Pearce [the head of the World Bank mission in Uzbekistan] provided journalists with press releases and special literature about the work of the agencies in Uzbekistan and also their background from the very outset.

It should not be thought that a country with problems will immediately be given credit. The IMF member states instruct the IMF as to what policy it should pursue. In rough terms, whether "one should be executed or pardoned" depends on the voting . The voting power of the member-states varies considerably. The USA, for instance, has 265,000 votes or 18 per cent of the total quantity, the small state of Palau [now called the Republic of Belau] has 272 votes or 0.002 per cent and Uzbekistan has 3,006 votes or 0.14 per cent.

When Uzbekistan joined the IMF in 1992, it considered the step to be a beneficial one. It contributed its quota of 374m dollars and took on all commitments except for article 8 concerning the convertibility of the national currency [the som]. This is a rare case, but is not exceptional. There are about 40 such countries throughout the world, and [Uzbek] President Islam Karimov has spoken a lot about why we did not hurry with convertiblity. Needless to say, a debate on the subject also took place at the news conference.

But first Christoph Rosenberg explained how information transparency could be achieved. IMF missions pay an annual visit to every IMF member state. Then the missions' reports about the economic situation [in the IMF member-states] are put out on the Internet. So the IMF missions' independent opinions are quite transparent and accessible. As for their recommendations, they are made public with the country's permission. The recommendations on Uzbekistan have not been made public yet, but in general one can understand that the young state does not want to inform the world about what it has been recommended [to do].

There was much that was curious in Mr Rosenberg's speech, but what journalists liked most about him was that he answered questions which he had not been asked. For instance, as soon as a journalist wondered how a mission collected economic information, a detailed explanation followed. We had good reason to be concerned about this issue because often ,when one is preparing an article, one comes across an official who has no desire to provide figures. You get them with difficulty and then suddenly discover that they diverge from the official statistics.

We wanted to ask: "Have you encountered any such problems?" [Rosenberg said:] "The statistics of the [Ministry of] Macroeconomics and Statistics may differ from those which we get from other sources. Anyone who has an interest in Uzbekistan trusts the IMF missions' reports and in the last one it had to be acknowledged that not all the figures in the IMF's published independent view coincided with the official figures."

Of course, journalists wanted to ask supplementary questions, but Rosenberg's general information was quite fascinating too. For instance, many did not know that the IMF was working on analysing the macroeconomic situation in Uzbekistan. Particular progress was made on this issue between 1994 and 1997. At that time, there were advisers here who held consultations on a wide range of issues, including the treasury, the monetary system, the consumer price index and national accounts.

The IMF office is located in the Central Bank of Uzbekistan and is continuing to work closely with both the bank and the Finance Ministry. "We provide credit by acting as a club of the central banks of almost all countries throughout the world."

"How does the IMF provide Uzbekistan with credit?" This was, perhaps, the issue with which the duel that is characteristic of all news conferences started between the official and the readers as represented by the journalists.

We should admit that we did not like all the answers because one always wants one's own country to be at the forefront. But the path to the leading position is not always smooth, at least that is how [Uzbekistan's] relations with the IMF have developed. The IMF decided to give Uzbekistan 240m dollars worth of credit in 1995, but the fund delayed two tranches in 1996. Why? The IMF experts considered that the country had changed its macroeconomic policy, and the fact that the government decided to delay the som's convertibility and that exchange points switched to purchasing foreign currency [the dollar] at an official exchange rate without selling it were contributory factors too.

How has this affected the balance of payments? Not very much. The restrictions which were introduced in 1996 with the aim of regulating the flow of foreign currency, improving imports and regulating exports did not live up to expectations anyway. Exports have declined.

Christoph Rosenberg, who has been living in Tashkent for several years and speaks good Russian, has quietly adapted to life here. During the news conference he gave media representatives a basic grounding on why it was bad to have two or three different exchange rates. Since the IMF office always monitors the national currency's exchange rate, he showed a chart with three curves on it. The chart was full of zigzags, and over the years they diverged considerably.

Three exchange rates - official, black market and commercial - frightened off foreign investors. Not only complications arising from convertibility are to blame for the fact that exports have shrunk, the head of the IMF mission in Uzbekistan noted. External factors - a fall in the prices of gold and cotton in the world market, the financial crisis in Russia and two years of poor harvests, had an impact on this as well. The smaller the flow of foreign investment, the lower the per capita dollar income.

Foreign experts put the 1997 outflow of foreign capital at 600m-800m [presumably dollars]. Enterprises' and firms' import quotas and licences may be cut in order to combat the trend [towards the outflow of foreign currency] and keep it in the country. We trod that simple path. At first, the measure was thought to be promising, but it turned out to be not all that promising.

Uzbekistan has drawn on IMF resources twice since 1995 in order to support the economic programmes which are being carried out by the government. There are no overdue debts. Uzbekistan looks after its image and tries to pay interest on time. But it is rather difficult to pay interest when the inflow of foreign currency has shrunk.

What one should do? This is the issue which was discussed by the government and the last [IMF] mission. The Uzbeks favoured an expansion of exports and clear economic mechanisms. Talking about this, Rosenberg compared Uzbekistan with a tanker which it is difficult to turn at [high] speed. Even if the exchange rates are brought together, it will take 2-3 more years for investors to invest capital in the country more energetically. In the meantime, bills have to be paid, and the expenditure side of the budget has to be offset as well.

"If one does not resort to external aid, expenditure may be cut through an increase in prices and taxes." None of those present at the news conference liked that part of the basic grounding. Another method is to make use of the IMF member's right and to ask "the Union of Central Banks" for funds. But Uzbekistan will be asked or, more correctly, has been asked to agree to an action programme. The pace of reform, its scale, transparency and opennesss should be outlined in the programme, in addition to convertibility, which is not so much important in itself but is important to the country's stability.

"How did your colleagues' last visit [to Uzbekistan] end?"

"The mission came in order to provide technical aid and hold consultations. The [action] programme was also discussed. The step, which was taken by Uzbekistan on 1st May, when the dollar's official exchange rate grew by over 50 per cent, was regarded favourably."

What is next? "Exchange offices will lead to the legalization of the black market, and that is useful anyway. But clearing is very important. Enterprises should sell their currency earnings at the market rate. Hitherto some enterprises had the privilage of paying at the official [exchange] rate, while others did not."

"What is your forecast for the end of 2000?"

"It is most likely that gradual measures will be taken in the country - not shock tactics."

In general, all plans will be a success. According to the optimistic forecast, [we] will shift to the convertibility of current payments in six months; according to the pessimistic forecast, in a year. But how will this impact on the social sector? It is well known that convertibility is good for stimulating exports by enterprises. The agrarian sector in our country is significant. If prices are liberalized, what happens if the prices of eight essential goods skyrocket?

It seemed that the IMF representative was very familiar with the issue. He agreed with journalists that the social aspect was, of course, important. But according to his information, about 60 per cent of all goods reaching the market are priced at the black market exchange rate. One may anticipate that the prices of some [goods] will go up, while others will go down.

"We did some calculations, and they showed that the overall impact of inflation will be moderate. But it is hard to make an exact forecast for all foods. Take bread. It is subsidized and is artificially cheap and, according to our calculations, on average, it constitutes 24 per cent of the consumer basket. The percentage is even higher in the villages. If the state keeps up its monopoly purchases of cotton and grain, the liberalized price of the product may become a heavy burden to rural residents. The urban population on fixed incomes, the staff of public sector organizations and pensioners are the most vulnerable to inflation. Of course, it is not easy for the government to take decisions. But a tough monetary policy is needed in order to curb inflation."

[We] wanted to interrupt the IMF representative once again over the words "is needed": "What is needed from us is clear. But what is it possible to get from you? What is the cost of the liberalization programme?" At this point, we heard that currency restrictions had been imposed on the country depending on our membership fee. However, 100m-150m dollars are not the limit. There are other investors who may react to the IMF's actions, and the overall amount [of money] will be more. What does the World Bank think of this?

The head of the World Bank's mission, David Pearce, said that the bank had been working in Uzbekistan since 1994. [The bank] is financing nine loans totalling 458m dollars, of which 236.5m dollars have been paid out for various projects. This year, will see the completion of the bank's second three-year period of activity [in Uzbekistan]. What projects did the bank support? Projects for institutional development and technical aid, the development of cotton growing and rehabilitation... [pluristops as given]. Some projects have been finished, and others such as the health cleanup of Tashkent, the development of city passenger transport, water supply, hygiene and health are planned [to be carried out] between 2003 and 2005.

Meanwhile the World Bank is ready to support initiatives to [launch the bank's] third three-year [period of activity]. The director of a World Bank department will be coming [to Uzbekistan] in early July to start consultations with the government.

Recently the government, with support from the Asian [Development] Bank, has drawn up investment plans. And now the World Bank should analyse this programme, assess the government's demands for investment and [consider the issue of] what problems might arise with domestic and foreign financing.

Are there any other investors in the economy of Uzbekistan?

It transpired that the World Bank had also been concerned about this issue long before alert journalists. On the list of donors, Mr Pearce mentioned the IMF, the Asian Development Bank, the EBRD, the UN and the unilateral donors - Japan, [South] Korea and a number of others.

"It is important to know about them, given the shortage of domestic and foreign resources, which need to be coordinated. It is important to know about them in view of the competition for resources among the World Bank's clients".

"What is unclear to me is to what extent Uzbekistan has an interest in major borrowing. Perhaps it intends to use its own resources at its [current] speed and our resources as additional ones?"

We did not know the answer. Then data concerning Uzbekistan's neighbours were announced. The World Bank allocated about 2bn dollars to Kazakhstan over 6-7 years, over 500m dollars to Kyrgyzstan and somewhat less to Uzbekistan. We differ from our neighbours in the amount of funds we ask for. In principle, the fact that we want to live according to our means is no secret to anyone. But, the head of the World Bank's mission was trying to find out for himself what the role of the international community was in the country's mid- and long-term development.

We ask for less [money] than others, but the World Bank has no fixed quotas. In addition to this, unlike commercial banks, institutional projects which lead to economic and social wellbeing are preferred here. Incidentally, a number of such projects are being prepared for Uzbekistan: the restructuring of agricultural enterprises, rehabilitation of the Karshi cascade of pumping stations, the setting up a drainage system on the right bank of the Amudarya [river] and [the provision of] water supply and hygiene in Samarkand and Bukhara. They are worth 288m dollars.

"Initially, it was planned that the borrowings would be between 300 and 500 [presumably million dollars]. But, for the time being, the overall figure is lower now because Uzbekistan lacks certain macroeconomic conditions."

"How do you assess Uzbekistan's investment achievements and prospects?"

"If any foreign capital is considered to be investment and the entire flow of foreign capital is taken into account, then, according to the official statistics, there was growth in 1999. We are guided by them but if [one looks at] direct foreign investment and foreign investors [separately] then we believe that such a volume [of investment] is not enough for the country. However, there is a big potential for attracting investment in mid- and long-term prospects.

"The bringing of both the commercial and the official [exchange] rates together under the government's decision of 1st May [presumably the government resolution of 29th June on improving and developing the country's off-exchange currency market] is likely to have encouraged many people.

"This is the first step towards the convertibility of current payments. We hope for further steps and rely on an optimistic six-month forecast for the bringing of the currency [exchange] rates together and the liberalization of foreign trade activity. But the economy needs coordinated measures as well."

ussia's Iluyshin aviation complex and Uzbekistan's Tashkent aviation association are studying the possibility of supplying 20 Il-76 Candid transports to China after it sent a preliminary request on the appropriate contract to both companies, Iluyshin Director-General Viktor Livanov told the Military news Agency.

According to him, the supply of 10 Il-76s to China in the near future is quite realizable. It will be possible to discuss optional supply of 10 more planes after the first 10 are contracted.

At present there are some dozens of new Il-76s on the Tashkent aviation association's airfield. The companies are planning to use them for supply. But the planes are to undergo preliminary adjustment according to Chinese air force requirements. The export price for one plane is 30m-35m US dollars. The last Il-76 supply to China happened in 1994.

tate-owned National Bank of Uzbekistan operates as a universal commercial bank within Uzbekistan and as a government agent in international markets. NBU accounts for over 60% of the country's total banking assets. The recent decision to privatize may bring in a foreign strategic partner to help expansion in central Asia. Its non-performing loans are very low ­ 0.1% ­ as many of the largest are new.

If government loans are excluded, this figure rises to 13%. But with government guarantees, its high level of liquidity and a capital adequacy ratio of 52%, the bank is secure.

he Uzbek cabinet of ministers has issued an instruction to provide textbooks to the schoolchildren who are taught in the Kyrgyz, Tajik, Turkmen and Kazakh languages.

The document allows entities to obtain textbooks which are not published in Uzbekistan by means of exchange with neighboring countries where significant Uzbek ethnic communities live who also need textbooks in their native language, sources with the Uzbek education ministry told Interfax. To this end, official letters have been sent to corresponding Kazakh, Turkmen, Kyrgyz and Tajik ministries to notify them on the planned quantity of textbooks and other school manuals to be published in Uzbek.

According to an agreement with the Kazakh education ministry, Uzbekistan has already received a batch of textbooks containing 12 articles from Kazakhstan, and the Uzbek education ministry is preparing in turn to send a batch of textbooks to Kazakhstan.

The Uzbek Cabinet of ministers allocated 700 million soms in the budget for 2000 to create an additional library fund of textbooks in all the languages in which schoolchildren are taught in the republic, including Russian. Uzbek authors have written a number of original textbooks on history, geography, mathematics, geometry, physics and chemistry in the Uzbek language since 1991. Part of the books is being translated into other languages. Textbooks on the Russian language and reading for the 2nd, 8th, 10th and 11th grade pupils have been published in 2000.

To set up a national base of textbooks, Uzbekistan is attracting finances from abroad. For instance, the republic will receive a $20 million loan from the Asian Bank of Development to publish textbooks and other school manuals.

All the future authors of the textbooks will take training courses in Britain to study the international standards of preparing school textbooks and educational supplies.

meeting took place at the Uzbek Emergency Situations Ministry on July 26 to review the ministry's results in the first six months of this years. Addressing the meeting, Minister Bahodir Qosimov, in particular, said that, thanks to the efforts of the government, some work had been carried out in ensuring peace and calm for the country's population in the review period. Over the six months of 2000, a republican search and rescue centre called "Najotkor" [Rescuer] and a special militarized mobile rescue unit in the centre of the town of Chirchik in Tashkent Region, which both fully meet modern requirements, were put into operation.

The fact that the water rescue service was also put under the Ministry's charge is a sign of government's great trust in the ministry's staff, and places heavy responsibility on the divers, the meeting noted. As a new kind of service is being organized, the ministry is also buying modern diving equipment. Its structures in the localities have rescued thousands of people and saved their lives.

The Emergency Situations Ministry is also doing a great deal of work under the Soghlom Avlod [a Healthy Generation] national programme; Starting from the 2000-2001 academic year, a 64-hour course of Basics of Human Safety courses will be held at secondary schools.

A programme has also been drawn up for arranging the training of Uzbekistan's secondary school students in the fundamentals of human safety in the event of an emergency. The aim of the programme is to teach the students ways of protecting and providing theselves and others first aid in the event of an emergency.

The meeting pointed out that the ministry and its substructures had been given responsible tasks and stressed the need for the existing issues to be settled as soon as possible. Those who spoke also voiced their views on this subject.

embers of the delegation of a Chinese-Uzbek commission on scientific and technological cooperation is currently visiting our country [Uzbekistan]. The members of the delegation visited the Academy of Sciences of Uzbekistan July 26.

The sides discussed issues related to further developing scientific and technical cooperation between the research institutes of Uzbekistan with the relevant institutes of China in the sector of cotton and rice growing, gardening, agriculture, machine building, seismology, energy and environmental protection.

court in the Uzbek capital, Tashkent, has sentenced a man to death for "rape, murder of a 13-year old girl and several robberies", the Uzbek newspaper `Turkiston' reported on 26th July. The paper said the girl's parents were away that particular day and she was returning home at midnight when she a man identified as Timur Abdulin trying to enter the house. The girl recognized Timur as her father's "acquaintance" and let him in. The man "ruthlessly" beat up the girl to an unconscious state, "raped and strangled" her in order to conceal the crime, the paper said.

perational measures conducted in the bordering areas of Uzbekistan have exposed 275 cases of the illegal export of goods, Uzbek TV reported on 25th July. Customs officers seized over 24 tonnes of petrol, more than 21 tonnes of diesel oil and about a tonne of oil products, over 11 tonnes of nonferrous metals, 33.5 tonnes of cement, 13 tonnes of salpetre, 36 cattle and 25 horses, the report added, without mentioning over what period these figures were registered.

The report said "wide-scale" work was being done to prevent the illegal import of firearms, explosive devices, narcotic substances and literature advocating "religious extremism and fundamentalism". The TV footage showed a customs check point, parked heavy vehicles, assault rifles, religious literature.

he launching ceremony of a study report on improving the management and the price policy of the water supply system of Uzbekistan, took place at the mission of the Japan International Cooperation Agency. It was attended by the Uzbek Ministry for Foreign Economic Relations, the Macroeconomy and Statistics Ministry, the Ministry of Municipal Economy, and by representatives of [capital] Tashkent and Chirchik [town in Tashkent Region] municipal firms dealing with drinking water.

The study report was worked out by Japanese and Uzbek specialists over two years and is aimed at improving the system of supplying Tashkent city and Chirchik town with water. Of special interest is the fact that the JICA workers are also planning to engage in research in other fields of the Uzbek economy.

session of the republican Commission on Monetary and Credit Policy held on 20th July considered the extent to which the activities of certain enterprises holding Central Bank licences meet the requirements of the Uzbek Cabinet of Ministers' resolution No 405 of 19th November 1996 "On enhancing the effectiveness of use of centralized currency resources in importing consumer goods".

It was pointed out that the results of the analysis conducted by a special working group of the republican Commission on Monetary and Credit Policy and by authorized banks indicated that certain enterprises holding Central Bank licences were failing to work satisfactorily to supply the consumer market with goods in line with the requirements of the above resolution, and also pointed to breaches of the existing trading regulations.

The meeting noted that the heads of certain enterprises holding Central Bank licences were negligent about drawing up import contracts and importing consumer goods in a timely way and also deliberately delayed selling stockpiled goods and encashing the proceeds from their sale in line with the established procedure. Taking all this into account, the republican commission resolved to strip 47 enterprises and organizations of the Central Bank licences which give a priority right to convert soms into freely-convertible currency.

The State Taxation Committee, the Committee For Demonopolization and the Development of Competition under the Ministry of Finance of the Republic of Uzbekistan and authorized banks were also instructed regularly to submit to the commission proposals for considering depriving of licences those enterprises which fail to make effective use of the convertibility quotas they are allocated.

krainian President Leonid Kuchma has spoken by phone with President Islam Karimov on July 26. During their discussion, bilateral economic cooperation and ways of increasing trade turnover were discussed. Kuchma also discussed the agenda for the summit of CIS heads of state with Islam Karimov. It will take place in Crimea in August.

ederal Security Service directorate officers have detained an advocate of Wahhabism, citizen of Uzbekistan Mahmud Salimov, in Sverdlovsk Region.

The visitor from Uzbekistan arrived in the Urals after he was put on the wanted list at home "for attempting to overthrow the republic's constitutional system". While hiding from the authorities, Salimov continued actively to promote the ideals of Wahhabism in the Urals and Siberia, on the territories of Artinskiy, Achinskiy and Krasnoufimskiy districts.

He is now under guard and the question of his deportation from Russia and handover to the Uzbek law-enforcement agencies is being considered.

general meeting of the shareholders of Uzbektelekom [Uzbek Telecommunications] joint-stock company has elected Abduvohid Hoshimovich Joraboyev the company's managing director.

hinese government delegation led by a Chinese deputy foreign trade and economic cooperation minister, the chairman of a small commission, Zhang Xiang, is currently staying in our country [Uzbekistan]. Our correspondent has the details on the visit.

According to the agenda of the visit, the members of the delegation held talks at the Ministry for Foreign Economic Relations and State Committee on Science and Technologies of the Republic of Uzbekistan today. The small commission for scientific and technical cooperation under Uzbek-Chinese Intergovernment Commission on Trade and Economic Cooperation held its first meeting at the State Committee on Science and Technologies of Uzbekistan.

The meeting discussed issues of bilateral scientific and technological cooperation and its prospects, outlined the main principles of scientific and technological cooperation between Uzbekistan and China. At present, the research organizations of the two countries cooperate in the following spheres: agriculture, seismology, energy, ecology and environmental protection. Drawing up mutually advantageous joint projects directed at developing the economies of the two countries is the main issue in developing these relations. A protocol, which contains the small commission's regulations, and relevant decisions on the issues which have been discussed, was signed at the meeting.

In line with the agenda the guests will visit the Ministry of Agriculture and Water Resources and hold talks there tomorrow. They will also visit a research institute of genetics and experimental biology and solar energy centre of the Academy of Sciences of the Republic of Uzbekistan.

rug dealing remains a special area of attention for the law-enforcement bodies. It is creating problems in the whole region, including our republic [Uzbekistan], whose territory is used for drug transit.

According to official data, there is a tendency towards significant growth in contraband transportation of drugs. Now you can see a graph on your television screens showing figures that point to what has just been said . The numbers of foiled attempts to traffic drugs for 1998 and 1999 practically tally. However, the amount seized last year significantly increased to almost 3 t. According to official information, heroin and opium are increasingly predominating amongst contraband drugs. The curve in the graph also testifies to this. My colleague will continue the subject with his report.

A resident of [the far southern Region of ] Surkhandarya was arrested. A driver by profession, he had brought onions to Tashkent to sell at a market, and 39 g of heroin in his stomach, which, as he said, he had bought from a stranger in [the administrative centre of Surkhandarya Region] Termez. He said that he had brought the drugs only for his own consumption, but not to sell. Asked whether this was too much for him, he gave a very vague answer: He is 29 and has left his wife and three children at home alone.

There are various reasons for people getting involved in drug dealing. If a person is a drug addict himself, he sees his benefit in the next dose of drugs. On the whole, the desire to earn fast and easy money prevails. There are also the kind of people who are insistently advised by others to engage in this filthy sort of activity, as in the following case:

Rapid-reaction officers received a tip-off that a certain resident of Tajikistan had been renting a flat in Sobir Rahimov district in the capital and that he had arrived in Tashkent to sell drugs. The amount seized was more than 500 g of heroin.

We managed to film another arrest literally the previous day. A resident of [the administrative town of eastern Syrdarya Region] Gulistan brought to the capital more than 80 g of that same white poison and decided to sell it almost in the centre of the city. Judging by his documents, this man had a good job with a private firm and had no criminal record.

According to the Health Ministry and the Internal Affairs Ministry, 2,300 people have been registered with the centre for curing drug addiction so far. The figures for incidence of drug dependence, again according to first-hand data, have tripled since 1995. Those who take drugs mainly include people between 18 and 40, in other words, this is the able-bodied stratum of the population.

zbek President Islam Karimov told a government meeting on 21st July that job creation was a "matter of life and death" for Uzbekistan, and said that development of small and medium-sized businesses should play a vital part in providing employment. He told the meeting, which was called to review the country's half-year economic results, that young men had to be provided with employment to prevent them from engaging in undesirable activities, and that the tradition of trading and business that had for centuries been traditional in Central Asia should be the mainstay of the job creation programme. Criticizing regional officials for inaction in implementing reforms, Karimov said more had to be done to attract foreign investors. Progress has been made in liberalizing the currency market, with the Central Bank rate now equal to the off-exchange currency rate, and foreign exchange offices operating. The president also announced that 200m dollars was being lent by various donors to fund educational programmes in the next two or three years. The following are excerpts from a recorded broadcast of the speech on Uzbek TV the same day; this version incorporates excerpts released on 21st July from an Uzbek radio report:

Uzbek President Islam Karimov, shown addressing meeting] Dear participants in the meeting!

I think you will agree with me that the main task of today's meeting is to make a fundamental and critical evaluation of the results of our work over the last six months, of our achievements and our shortcomings, and to outline tasks for the next six months od this year. [Passage omitted: the republic has seen a 3.8 per cent rise in GDP, a 6.2 per cent increase in industrial production, 7.1 per cent increase in consumer goods, 5.3 per cent rise in retails turnover, 7.1 rise in agricultural production; so far the farmers have laid in 2.2m tonnes of grain, which is 50,000 tonnes up on last year; positive trade balance; monthly inflation rate dropped from 1.9 per cent in 1999 to 1.5 per cent; a total of 113 enterprises have been privatized in the first six months; development of small and medium businesses should play a vital part in providing employment: first, government resolutions adopted to encourage business, second improvement of crediting system, thirdly material and technical support provided]

Despite the fact that foreign investors are displaying interest in our companies, not a single one of the 13 facilities intended for privatization on an individual basis has yet been privatized. In the first six months, not a single share in joint-stock companies in the Republic of Karakalpakstan, Dhizak, Surkhandarya, Namangan, Syrdarya, Bukhara, Khorezm and Navoi Regions was sold to foreign investors.

The Regional heads are present here. What are the problems and tasks that face these Regional governors? The reform of our economy is the most important task for us today, for the whole of our country, and that includes denationalizing companies and then privatizing them. Let me put a natural question to the governors present, how will they answer it? Six months have passed and has any of you ever, even once, asked yourself what the progress in this area has been, whether there has been any step forward in the Region in your charge, what the obstacles to the changes are, or what how firms subordinate to you have changed, or whether their shape and form in terms of ownership is changing or not. We have been repeatedly attacking you from this rostrum, calling on you to be aware. There should be a limit for this too. Why have none of you ever put this question to yourselves? What is stopping you from doing so? Why do you not have the faintest idea of reforms in the areas in your charge? Why are you not responsible for this? Why are you not worried about this issue? I am right to pose this question. Should all reforms be in Tashkent alone?

The heads of enterprises intended for privatization themselves are failing to exercise initiative in this respect. Empty and fruitless negotiations are overunning the time allotted. I think that the reason for such cases is that the heads of firms are afraid of losing their positions when foreign investors take up their responsibilities as shareholders.

That is, foreign investment channelled into a company will have its owner. Take a company, say, in Kashkadarya or Bukhara, or Surkhandarya. Let us imagine: some part of the holding in this company is sold. I mean part of this company is acquired by its new foreign owner, who puts his money, his dollars into it. Naturally, this new owner will impose modern requirements. Naturally, this new owner will object to the way you are working. Overall, he may rate you negatively. Tomorrow he may raise objections, saying: I can't stand this official, this official has an old mind-set. This official does not want new requirements to be introduced. The requirements of the old [Soviet] regime still remain in his bones. It is impossible to change this man. This is what [local company heads] are afraid of. What is the conclusion we should draw from this? Why should we rely on these bosses, why should we take the interests of these officials into account when conducting our policies? How long is this going to go on? We could have made such officials watchmen. Why are they holding their current posts if they are mindless, if there is no change after nine years of criticism of them and if they keep doing what they wish. There is nothing substantial behind what they offer as a show. They only know their own interests. We cannot tolerate such deeds. This stops foreign investment from coming in our country.

Fourthly, the information and consultative centres established to support entrepreneurs, and also business incubators, significantly stepped up their activity. They have performed more than 45,000 services to entrepreneurs this year. More than 2,000 people have undergone training within the business incubator system and more than 11,000 entrepreneurs improved their skills in operating in market conditions over the period under review.

Fifthly, since the Justice Ministry was set the task of protecting the rights of entrepreneurs, there has been a significant increase in work to protect entrepreneurs from unsubstantiated inspections of their financial and economic activity by local administrative and supervisory agencies. As a result the number of inspections was 22 per cent down on last year. In particular, there has been a nearly nine-fold decrease in the number of unsubstantiated inspections over the past six months.

More than 18,000 small and medium businesses have been registered over the period under review alone. Today their total number exceeds 175,000. Due to the development of small and medium enterprises, and I ask you to pay special attention to this figure, more than 106,000 jobs have been created in our country, all thanks to the development of small and medium businesses. From this conclusion and this figure we all can see how greatly we can contribute to settling the current problems of the republic, country and homeland. Numerous people are unemployed in the localities, villages, district centres. Numerous people would be happy to get ordinary jobs. You know what negative outcomes this may lead to. Job creation is a matter of life and death for Uzbekistan. If young lads are not provided with jobs tomorrow, what sort of activities will they get involved in? What trends will they join? In general, it is a matter of conscience for a man of great soul to feed his family. We have to help him in this. How can we help? By providing jobs. Providing jobs and again providing jobs.

What can we use to create those jobs? Our most important or, indeed, decisive way is small and medium businesses, entrepreneurship. Believe it or not, recall again this [changes tack], let journalists sitting here put this in the people's mind.

Over centuries in Central Asia, in the area of current Uzbekistan, there has been what we call small business, but what was in days of old called petty trading, other activities or goods manufacture. No matter what it was called, it has one meaning, namely to keep people busy with work, to establish small enterprises in localities where people live. If we cannot solve this task I do not know how we will provide the growing population with jobs and how we will make the people living our country wealthy. What will be the cost? We have no land reserves and we are experiencing a shortage of water. Come on, let every person living in such God-blessed, heavenly land ask himself this question. What will our future be? What will be the cost of Uzbekistan reaching the level of developed states? Who will pay for it? Who and what will make an impact? Which sector will enable us to achieve this? Anybody who fails to understand this cannot live in this country and still count himself a patriot.

I, from this high tribune, want to repeat again the task which has been voiced thousand times: this is a matter of life and death. We have to pay attention to this issue at every step we make. Every leader and official sitting here must make his contribution to the solution of this task, not to mention overcoming obstacles. The legislation relevant to this sector should be freed so as to allow these goals to be achieved. Creating various concessions for entrepreneurs, especially in the banking sector, is very important.

Agreements have been reached with the Korean government, the Korean Export and Import Bank, the Japanese government and the Asian Development Bank on allocating Uzbekistan credits for buying text-books and office supplies necessary for education.

Today, standing from this rostrum, we can give our own account: In the last year - or rather, the last six months, in carrying out the national programme for specialist training the most advanced countries, first of all Japan, the Asian Development Bank, [South] Korea [sentence incomplete]. I myself visited Korea and during talks with the Korean president, I personally asked him to help us to make our educational arrangements similar to theirs. I twice sent a letter to the prime minister of the Japanese government and our representatives, the Foreign Ministry and deputy prime ministers of our government paid two visits to Japan and personally met the prime minister. They had special talks with the Japanese embassy here. I had two meetings with the Japanese ambassador, who has particular respect for us, during which I noted that this [education] was the most important and the most decisive issue, as the education our children get should be as good as that of foreigners.

From this point of view, after such requests, they are ready to give us around 200m dollars, with about 60m from the Asian Development Bank, around 55-60m dollars from Japan - the final decision should be made any day now, around 50m from the Japanese Export and Import Bank and similar sums from others, all totalling 200,000. What will we earmark this money for? To equip colleges and lycees. For the record, around 200m dollars will be spent on equipment in the next two or three years. What does this mean? This is our attention to the upbringing of the generation that will replace us tomorrow and efforts to give them education of the same high quality as that of others.

Dear friends!

In conclusion I would like to dwell on an issue which I would say is of crucial importance for us, namely measures to liberalize the currency market. Liberalization of currency policy is becoming a key link in our strategy for deepening reforms and liberalizing the economy.

A number of important measures have recently been implemented to lay the foundations for conducting a consistent and balanced liberalization policy. The off-exchange currency market's potential has been considerably widened and strengthened.

From 1st May, the entire system of conducting statistical and other types of accounting involving currency operations has been switched to the off-exchange currency rate, thus evening up the off-exchange rate and the Central Bank rate.

At the same time, with the aim of preventing a growth in prices, above all in prices for essential foodstuffs, a favourable new taxation system has been introduced for trade organizations.

Excise stamps for socially significant goods have been abolished. Foreign currency exchange offices have opened and are already operating. Measures have been taken in this field to broaden the opportunities of the commercial banks. The gold and currency reserves created over the last few years make it possible to fully start foreign currency operations.

The Central Bank and the Ministry of Finance are constantly to monitor changes on the currency market and make timely proposals on developing and strengthening the operation of the off-exchange currency market and of exchange offices.

The Cabinet of Ministers is strictly to monitor how the domestic market is supplied, above all with goods manufactured in the country. At the same time it is strictly to monitor improvements in the way importing and selling of essential foodstuffs are organized.

And most importantly, local authorities are to take all measures to improve the organization of trading services for the population, to create optimum conditions for trade organizations and to develop and strengthen up-to-date forms of trading.

Dear compatriots!

The tasks ahead of us are extremely difficult and urgent. We should tackle them immediately. I am confident that we will be able to find solutions to these problems and to lay a firm foundation for liberalizing the economy, ensuring its stable and dynamic growth and for raising our people's living standard.

The results in the first half of 2000 show that our country is making sure and stable progress along the path of reforms in order to achieve our goals.

I wish you all success in achieving these goals.

nokke-Heist, Belgium (AP) -- Results Sunday of the $110,000 Sanex Trophy WTA Tour clay-court tournament: Singles Championship

Anna Smashnova (6), Israel, def. Dominique Van Roost (1), Belgium 6-2, 7-5.

Doubles Championship

Giulia Casoni, Italy, and Iroda Tulyaganova, Uzbekistan, def. Catherine Barclay, Australia, and Eva Dyrberg, Denmark, 2-6, 6-4, 6-4.

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t a Cabinet of Ministers meeting called on 21st July to review the results of the social and economic development in the first six months of 2000 and the progress of economic reforms, President Karimov, asked the heads of ministries, regional governors, association and organization heads for their suggestions and views on items on the agenda.

[Karimov, shown addressing meeting] We say that our press and television lack criticism. I myself propose that officials like this [gesturing towards an unidentified official who had addressed the meeting on agricultural affairs] should prepare a programme jointly with journalists, with examples from the localities, to give this man an opportunity to severely criticize shortcomings. This is of benefit both to journalists and to you alike. Why do you not do such things?

Wherever they [unspecified people] meet, they say there is no criticism in Uzbekistan, the media in Uzbekistan is kept under pressure. [Karimov gestures towards the press gallery] Who is exerting pressure on you now? Who is stopping you, the media I mean, from doing your job? Go to the Regions to see who is putting pressure on farmers. Why do you not disclose the names of those officials who hamper entrepreneurship, why do you not show their faces to the whole of the country? Is it so difficult to leave Tashkent? This question is not only to you, it is to all of you. You [the media] must make overtures to him, ask him, saying: my friend, show me your problems, I am a journalist and ready to help you, and if you are afraid, I myself will prepare a report for you, help you out. Why do you not try this way?

I would like to avail myself of this opportunity to say that whoever - let them hear me say this from this rostrum - avoids meeting the media, they should be quite clear that we do not need such officials. As a holder of a post, you should assume the responsibilities it involves. Learn to answer questions from journalists. It is another matter whether you like his question or not. Recently on television I saw a journalist with a microphone chasing after a senior official who was running away and closing the door behind him. Why do you not show us his face? If you are brave, why not speak to the television cameras, arguing in your own favour.

The request I put to district heads, district administration workers, I mean officials, administrative bodies, be they from the prosecutors' office, police, tax or justice offices, is to make as many television appearances as possible and not to be afraid! Learn to reply to questions. Let the public see and know you, those who protect them, those act to defend them and know who does not.

My request is that - they may not be hearing me now, I will have a list of them tomorrow [sentence incomplete]. I will ask [Internal Affairs Minister Zohirjon] Almatov, the prosecutor-general, tax officials and others to give me a list of those who are avoiding meetings with media, I will sack all of them tomorrow. They will not work. The public must see and be aware of how our life is progressing and what the obstacles in the way of this are. This is what I can do to help you. Whoever runs away from you, the media, will be running away from their posts, jobs and duties. Let them know this.

he president of Uzbekistan, Islam Karimov, received a member of the House of Representatives (lower house) of Japan, Muneo Suzuki, at the Oqsaroy residence in Tashkent. Welcoming the guest to Uzbekistan, the head of state said that cooperation ties between Uzbekistan and Japan were developing and that Japan was making a great contribution to the restoration of the Great Silk Road. In turn, expressing his gratitude for the cordial reception, the member of the Japanese House of Representatives, Muneo Suzuki, voiced his satisfaction with the development of economic links between Japan and Uzbekistan. The Japanese ambassador to Uzbekistan, Kyoko Nakayama, and Uzbek Foreign Minister Abdulaziz Komilov attended the reception.