Arriving in Bukhara (Buxoro) this week provided another opportunity to observe and reflect on the society and culture of Uzbekistan–but also its economy. The streets are bustling, the bazaar is full of both people and wares, and restaurants seem to be full in the evenings. But these can’t be really accurate indicators, because from passing observations we do not know the details of transactions, or what the average capacity or turn around on sales may be in an “average” day or week. That said, it is fairly clear that the mostly Russian and European tourist market is strong.
The question I am curious about is to what extent the internal economy as reflected by Uzbek needs and production (not tourism) is strengthening? My realization that the currency is being floated in relation to the rouble (unfortunately discovered when I lost what should have been $75 in roubles) was just one such indication of this diagnosis. The Tashkent Times recently noted that the inflation rate was 17% and steady; and the Kun.uz online reported this week that the price of wheat would now be raised and sold at market rates, so as to allow farmers not to be harmed by artificially prices–a directive from the president himself. It’s not completely clear what calculus the Ukraine war or the influx of Russians to Tashkent and elsewhere in Uzbekistan have to do with these points, but we cannot discount these external factors and their push on economic uncertainty.