WMRC Daily Analysis
December 3

The European Bank for Reconstruction and Development (EBRD) has advised the Uzbek authorities to reach agreement with the IMF over currency convertibility. Announcing the approval of loans totalling 100m euro for the Central Asian state (primarily for the improvement of energy infrastructure), EBRD president Jean Lemierre said that the bank would urge Uzbekistan to push through legislation to make its currency convertible to secure a standby agreement with the Fund.

The IMF and Uzbek authorities have had an uneasy relationship since Uzbekistan joined the Fund in 1992, following the collapse of the Soviet Union. In 1995 the IMF approved a US$144m systemic transformation facility for Uzbekistan, along with a US$185m standby facility. However, funding was suspended the following year as a result of non-compliance with the conditions of the funding.

Earlier this year, Uzbekistan said that it would implement currency liberalisation measures in a bid to have its IMF funding unblocked, but delays and failure to meet deadlines have seen talks with the IMF pushed back to 2003.

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