After obtaining loans in US currency, his liabilities quadrupled: since 2017, the value of the dollar has risen from 4,100 to 11,430 Uzbek soms. Faced with the impossibility of paying off their debts, many are accused of fraud and some are in prison. President Mirziyoyev had encouraged this type of financial operations to increase agricultural potential.
Moscow () – In Uzbekistan, hundreds of businessmen who had received generous loans from the state after the liberalization of the foreign exchange market in 2017 are now on the brink of bankruptcy. After receiving hundreds of thousands and even millions of dollars to build greenhouses, thermal plants and develop intensive crops according to government plans, their liabilities doubled and tripled overnight.
As of September 2, 2017, the price of the dollar on the exchange market was 4,100 Uzbek soms. Today, the data stands at 11,430, and the banks demand to settle the loans at the current exchange rate.
Companies declaring bankruptcy are multiplying, as are lawsuits against them for financial fraud. Several owners are already in jail, and many are busy defending themselves in court. In business, the State is accused of “breaking ranks” to prevent those affected from aligning themselves, and of using the judiciary as a weapon to defend the interests of central power.
ozodlik He says that a businessman from Bukhara, Šavkat Kudratov, has lived on loans in local currency since 2015. When he was offered a loan in dollars to carry out a state project, he initially refused, but later trusted the promises. And now the court asks him: “Didn’t you know that the dollar would get more expensive?”, to which he replies “I knew it, I don’t deny it, but I thought it would increase between 10 and 20 soms a month at the most”, to a regular and predictable rhythm. But “it could not be foreseen that its value would double in one day.”
The problem is that article 383 of the Uzbek Civil Code clearly states that “any unforeseen circumstances will be resolved in favor of the businessman”, and the increase in the price of the dollar was unforeseeable. Kudratov, like many others, does not feel guilty of fraud: “If he had known, he would never have accepted such a loan.” In 2015, he had signed a loan with an exchange rate of 1 to 2,692, and today the official rate has more than quadrupled. “This is not in accordance with the law and neither with common sense,” but the judges are inflexible, and they rely on presidential decrees.
Kudratov’s project was scrutinized by state officials for a year. It was concluded that the estimated benefit was 20%, and therefore it would be easy to repay the credits received. Now that credit has increased by 400%, none of the officials have come forward to recommend an exit. The businessman paid his quota regularly – not without difficulty – for seven years, covering 30 thousand dollars, compared to the total credit of 240 thousand. Meanwhile, the initial sum of 646 million soms has now become 3.7 billion soms, payable to the Kišlokkurilišbank Institute.
Appealing to the Chamber of Commerce is useless; Its leaders say that these are “force majeure situations” in which they cannot do anything, because “they are not directly specified in the contract.” They recommend asking the Ministry of Foreign Economic Relations for clarification. Entrepreneurs run out of instances to turn to, all the courts of appeal and arbitration are on the side of the banks and the State, “they play their game behind our backs,” concludes Kudratov.
There are many businessmen who are going through similar or worse situations, and there are even several behind bars. When President Šavkat Mirziyoyev visited the regions where the main agricultural farms are located in 2016-2017, he himself tried to convince as many people as possible to access credit, intensify cultivation and other activities, involving all of them. central and local administrations, as well as banks.
It was ensured that the loan installments would be paid in local currency, not dollars. However, the situation has changed so much – especially after the turbulent year of the Russian war in Ukraine – that even a relatively solid country like Uzbekistan is in crisis.
