Tashkent, Uzbekistan – In an interview with the Financial Times, Central Bank Chairman Timur Ishmetov outlined the country's strategy to gradually increase the share of financing in the national currency, the som, and to prioritize direct foreign investment over external debt.
Ishmetov noted that historically, a significant portion of financing was raised in foreign currency due to the need for investments and external resources. This, in turn, created currency risks. Developing the som-denominated financing market has therefore become a key objective.
One of the first steps in this direction, he said, was the issuance of Samarkand bonds by the International Finance Corporation (IFC) in 2019. Subsequently, the Ministry of Finance placed Eurobonds first in foreign currency and then in the national currency.
“It was a great success, with high demand from investors. After that, banks began issuing Eurobonds in the national currency, and now companies are also moving in this direction,” the central bank chief emphasized.
According to him, the Ministry of Finance has so far used the national currency in raising financing, but the situation may change in 2026. “We are gradually increasing the share of financing in the national currency. Of course, the total volume of accumulated debt is large, so changes may not be very noticeable, but we are issuing more and more new securities in som,” Ishmetov said.
The central bank chairman added that investor interest in som-denominated instruments is growing. This is attributed to the stability of the exchange rate and investor confidence that low inflation and a stable exchange rate can be maintained in the long term.
At the same time, Ishmetov noted that the existence of currency risks does not mean abandoning external borrowing. “We need to focus on increasing the share of the financing market in the national currency,” he said.
Discussing the structure of capital flows, the central bank chief stressed that Uzbekistan should focus more on long-term direct foreign investment rather than debt financing. “As for the exchange rate, we are supporters of a floating rate. We have a very bad experience with playing with the exchange rate. We don't need anyone to teach us not to repeat these mistakes,” Ishmetov said.
He noted that the transition to a floating exchange rate took considerable time and was the result of reforms over the past decade. “As part of the reforms of the last decade, especially at the cost of much time and effort, we moved to a floating exchange rate. Now we don't want to play with it. We remain committed to the floating exchange rate,” he said.
In the future, Uzbekistan needs to simultaneously increase the share of financing in the national currency, attract more direct investment, and reduce the dependence of economic growth on external debt, the central bank chief concluded.
Since the beginning of 2025, the som has strengthened against the dollar: in 2025 by almost 7%, and since the beginning of 2026 by another approximately 1.9%. At the same time, the trade deficit remains high. Economist Mirkomil Kholboev explained the factors influencing the dollar's decline in a column.
Earlier, Ishmetov announced that the Central Bank had prepared a roadmap for further liberalization of the capital operations account and intends to implement it gradually due to risks to financial stability and the exchange rate. He also said that plans are underway to complete the liberalization of remaining administratively regulated prices, including water and other utility tariffs. The regulator's head called the Central Bank “fully independent” in making decisions on the key rate and exchange rate.
Source: www.gazeta.uz