Uzbeks Forced to Cut Cotton Exports
Uzbeks Forced to Cut Cotton Exports
The authorities in Uzbekistan have announced plans to reduce cotton exports and downsize the area of land used to grow this lucrative crop.
NBCentralAsia analysts suspect this change in policy has less to do with the stated intention of building up a domestic textile industry than with the international boycott of Uzbek cotton by leading western manufacturers and retailers reluctant to buy a product picked by child labour.
On October 9, at the end of an international cotton fair in Tashkent, Foreign Economic Relations Minister Elyor Ghaniev announced that the country planned to cut sales of cotton abroad to 700,000 tons in the 2008-09 export period.
Uzbekistan is the world’s second-largest exporter of cotton, selling between 800,000 and 1.5 million tons of raw cotton a year. Cotton is the country’s key export revenue.
Ghaniev said exports were to fall because Uzbekistan was going to process more cotton into textiles. To achieve this, 22 new textile mills costing 158 million US dollars are to be set up, so that by 2012, the country will be processing almost half of the cotton it grows, compared with between two and five per cent at the moment
In a separate move, President Islam Karimov signed a decree on October 20 outlining plans to reduce the area planted under cotton by almost 50,000 hectares. His decree suggests that Uzbekistan is serious about cutting export volumes.
Victor Ivonin, an economist in Tashkent, says it makes a lot more sense for Uzbekistan to process cotton domestically, as this will create many jobs.
Ivonin said the cut in exports was designed to protect Uzbekistan from unfair competition on world markets.
“It’s the behaviour of our major opponent in the cotton sector, the United States, which controls 26 per cent of the world cotton market, grant government subsidies to its own exporters and buy one-third of their cotton production,” said Ivonin. “That depresses prices on the Liverpool Cotton Exchange, and that’s why we have to dramatically increase cotton processing here.”
Other commentators are less convinced by the authorities’ arguments. They say the government has pledged to cut exports and develop domestic manufacturing in past years, without making it happen.
“We’ve been hearing this for many years, but the textile branch is still in its infancy and local textile production is undeveloped,” said an observer in the Fergana valley.
“How is Uzbekistan supposed to develop its textile industry?” asked Tashpulat Yoldashev, an Uzbek political analyst now in emigration, said. “Investment is needed to develop the industry, and investors aren’t going to come into a country which lacks economic openness and guarantees.”
Yoldashev said the real reason for reducing cotton growing and exports is the international boycott.
In 2007, four major import and retail groups in the US and Britain criticised Uzbekistan’s use of child labour.
Wal-Mart, Tesco, Marks & Spencer, Target and Gap, the National Retail Federation, the Retail Industry Leaders’ Association, the American Apparel and Footwear Association, and the Association of Importers of Textiles and Apparel all publicly renounced imports of Uzbek cotton at the recent Tashkent cotton fair.
According to one local commentator, “The authorities would like to claim that the western boycott hasn’t had an effect, yet they are forced to admit it by implication, via decrees on developing the textile industry and reducing the planting area which inadvertently shows how badly it’s hurting.”
On September 12, Prime Minister Shavkat Mirzieyev signed off on plans to bring into force two international conventions banning child labour which Uzbekistan ratified in April this year. The government also approved a national action plan for enforcing the minimum working age.
The new rules mean that minors under the age of 15 cannot be employed, including in cotton farming. NBCentralAsia observers said the official ban on child labour was intended to address international concerns and maintain Uzbekistan’s position on the world market.
(NBCentralAsia is an IWPR-funded project to create a multilingual news analysis and comment service for Central Asia, drawing on the expertise of a broad range of political observers across the region. The project ran from August 2006 to September 2007, covering all five regional states. With new funding, the service is resuming, covering only Uzbekistan and Turkmenistan for the moment.)
NBCentralAsia analysts suspect this change in policy has less to do with the stated intention of building up a domestic textile industry than with the international boycott of Uzbek cotton by leading western manufacturers and retailers reluctant to buy a product picked by child labour.
On October 9, at the end of an international cotton fair in Tashkent, Foreign Economic Relations Minister Elyor Ghaniev announced that the country planned to cut sales of cotton abroad to 700,000 tons in the 2008-09 export period.
Uzbekistan is the world’s second-largest exporter of cotton, selling between 800,000 and 1.5 million tons of raw cotton a year. Cotton is the country’s key export revenue.
Ghaniev said exports were to fall because Uzbekistan was going to process more cotton into textiles. To achieve this, 22 new textile mills costing 158 million US dollars are to be set up, so that by 2012, the country will be processing almost half of the cotton it grows, compared with between two and five per cent at the moment
In a separate move, President Islam Karimov signed a decree on October 20 outlining plans to reduce the area planted under cotton by almost 50,000 hectares. His decree suggests that Uzbekistan is serious about cutting export volumes.
Victor Ivonin, an economist in Tashkent, says it makes a lot more sense for Uzbekistan to process cotton domestically, as this will create many jobs.
Ivonin said the cut in exports was designed to protect Uzbekistan from unfair competition on world markets.
“It’s the behaviour of our major opponent in the cotton sector, the United States, which controls 26 per cent of the world cotton market, grant government subsidies to its own exporters and buy one-third of their cotton production,” said Ivonin. “That depresses prices on the Liverpool Cotton Exchange, and that’s why we have to dramatically increase cotton processing here.”
Other commentators are less convinced by the authorities’ arguments. They say the government has pledged to cut exports and develop domestic manufacturing in past years, without making it happen.
“We’ve been hearing this for many years, but the textile branch is still in its infancy and local textile production is undeveloped,” said an observer in the Fergana valley.
“How is Uzbekistan supposed to develop its textile industry?” asked Tashpulat Yoldashev, an Uzbek political analyst now in emigration, said. “Investment is needed to develop the industry, and investors aren’t going to come into a country which lacks economic openness and guarantees.”
Yoldashev said the real reason for reducing cotton growing and exports is the international boycott.
In 2007, four major import and retail groups in the US and Britain criticised Uzbekistan’s use of child labour.
Wal-Mart, Tesco, Marks & Spencer, Target and Gap, the National Retail Federation, the Retail Industry Leaders’ Association, the American Apparel and Footwear Association, and the Association of Importers of Textiles and Apparel all publicly renounced imports of Uzbek cotton at the recent Tashkent cotton fair.
According to one local commentator, “The authorities would like to claim that the western boycott hasn’t had an effect, yet they are forced to admit it by implication, via decrees on developing the textile industry and reducing the planting area which inadvertently shows how badly it’s hurting.”
On September 12, Prime Minister Shavkat Mirzieyev signed off on plans to bring into force two international conventions banning child labour which Uzbekistan ratified in April this year. The government also approved a national action plan for enforcing the minimum working age.
The new rules mean that minors under the age of 15 cannot be employed, including in cotton farming. NBCentralAsia observers said the official ban on child labour was intended to address international concerns and maintain Uzbekistan’s position on the world market.
(NBCentralAsia is an IWPR-funded project to create a multilingual news analysis and comment service for Central Asia, drawing on the expertise of a broad range of political observers across the region. The project ran from August 2006 to September 2007, covering all five regional states. With new funding, the service is resuming, covering only Uzbekistan and Turkmenistan for the moment.)
