The Republic of Korea has solidified its position as one of Uzbekistan's top five trading partners joining China, Russia, Kazakhstan and Turkey according to a recent report by the State Statistics Agency. In the first seven months of 2024, Uzbekistan's foreign trade turnover (FTT) reached $36.8bn, marking a 5.3% increase compared to the same period in 2023. Of this total trade volume, exports accounted for $14.79bn, although this represented a slight decrease of 1.1% from January to July 2023. Conversely, imports surged by 10.1% totaling $22.05bn. South Korea's share in this trade landscape has been significant, with trade between the two countries amounting to $1.19bn.
Despite being one of Uzbekistan's leading trading partners, the year-on-year data reveals a gradual decline in trade volume over the past two years. In 2022, trade between South Korea and Uzbekistan stood at $1.4bn which fell to $1.2bn in 2023 and slightly declined further to $1.19bn in 2024.
Trends in Exports and Imports
Uzbekistan's exports to South Korea also followed a fluctuating trend. After rising from $22mn in 2022 to $25mn in 2023, exports dropped back to $22mn in 2024. Similarly, imports from South Korea experienced a decrease, from $1.4bn in 2022 to $1.2bn in 2023 before settling at $1.16bn in 2024. Despite these declines, South Korea remains a key player in Uzbekistan's import landscape, contributing 5.3% of the total imports and ranking fourth among the 20 major partner countries for imports from January to July 2024.
South Korea's contribution to Uzbekistan's import of industrial products has also been notable. In the first seven months of 2024, the import volume of industrial goods reached $3.3bn, showing a 1.7% increase compared to the same period last year. Of this, South Korea's share amounted to $87.9mn reflecting the ongoing demand for Korean industrial products in Uzbekistan.
Strategic Investments and Economic Cooperation
The economic ties between Uzbekistan and South Korea extend beyond trade, with South Korea playing a pivotal role in Uzbekistan's dynamic development across various sectors. Currently, there are 726 joint ventures between the two nations covering industries such as energy, chemistry, automotive, electrical engineering, textiles and food production as previosuly reported by Daryo. Korean investments in Uzbekistan have surpassed $7.5bn indicating a strong commitment to bilateral economic cooperation.
Uzbekistan is one of South Korea's largest partners in Emerging Europe and Central Asia, with trade reaching $1.9bn in 2021 and growing to $2.34bn in 2022 and 2023. Over 500 Korean companies operate in Uzbekistan, including major firms like Samsung, LG, Lotte and Hyundai. The countries have also established several free economic zones such as Navoi and Angren further enhancing their economic collaboration.
Future Prospects and New Investments
To build on this strong foundation, Uzbekistan and South Korea are working on an Agreement on Sustainable Trade and Economic Partnership (STEP) which aims to further strengthen economic ties and ensure sustained growth. As reported by Daryo earlier, this agreement is expected to provide a structured framework for continued cooperation addressing both countries' economic challenges and opportunities.
Furthermore, during a forum held in June 2024, the leaders of both nations committed to boosting trade and investment through flexible financing and favorable business conditions. President Shavkat Mirziyoyev announced plans to establish a regional high-tech hub in Uzbekistan focusing on raw materials processing, semiconductors, smart agriculture and green energy.
The forum showcased several strategic collaborations including textile projects with POSCO and a children's clinic supported by Eximbank and CNT. New investment projects totaling $9.6bn were also announced. These projects cover key areas such as semiconductor production, green hydrogen and ammonia production and the establishment of a Chemical Technology Center.
Uzbekistan also aims to leverage Korean expertise in digitalization, infrastructure, and urban planning. Curently Uzbekistan has trade relations with 187+ countries worldwide.
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