ENHANCING THE ECONOMIC POTENTIAL OF UZBEKISTAN THROUGH THE DEVELOPMENT OF ROAD TRANSPORT

ABSTRACT

This article analyzes the use of road transport and offers suggestions for improving the economic potential of Uzbekistan by improving it and further development of the country's transport sector.

АННОТАЦИЯ

В данной статье проводится анализ использования автомобильного транспорта и предлагаются предложения по повышению экономического потенциала Узбекистана за счет его совершенствования и дальнейшего развития транспортной отрасли страны.

Keywords: road transport, network, public road, economic opportunities, vehicle.

Ключевые слова: автомобильный транспорт, сеть, дорога общего пользования, экономические возможности, транспортное средство.

Introduction

Uzbekistan is landlocked within other landlocked countries characterized by vast desert and mountainous terrain. It’s geography has influenced the development of transport, with a long spinal corridor connecting the country internally and extending to its neighbors. Being double-landlocked poses formidable constraints to Uzbekistan’s development, increasing logistics and transport costs considerably. To unlock Uzbekistan, an integrated multimodal transport system offers an economically attractive option to restore Tashkent’s pre-independence status as the preeminent transport hub of Central Asia. The system should give equal priority to traditional north-south corridors connecting Uzbekistan with its Commonwealth of Independent States (CIS) neighbors (and extending to Afghanistan, Pakistan, and Iran for alternative maritime access) and east-west corridors connecting China with the Middle East and Europe via Uzbekistan

The total size of the road network is about 185,000 km, of which 42,695 km constitute a public road network, or ‘roads of common use’, 75,000 km are agricultural tracks, and 68,000 km are municipal roads and streets. Common use roads are functionally classified into international (3,981 km), national (14,100 km), and regional roads (24,614 km), and are owned and managed by CAR. Municipal roads are owned by municipalities, but their maintenance is under the responsibility of local branches of CAR. Road coverage and connectivity in the Ferghana Valley and Tashkent are comparable to those in Western European countries in terms of coverage, although service levels are lower. For the most part, Uzbekistan has achieved basic road connectivity, and only a few remote regions lack all-weather road access. The public road network is arguably one of the largest public sector assets of Uzbekistan, with a conservatively estimated replacement value (net of land, major bridges, and tunnels) of US$45–US$55 billion [1].

Method

At the end of 2019, nearly two-thirds of the common use public roads were assessed as being in good or excellent condition (table 1). This assessment is based on biannual visual inspections, which are highly subjective and may not be based on a consistently applied metric. About 95 percent of common use roads is paved and less than 5 percent is gravel and earth surfaced. The use of cement concrete pavements is increasing rapidly. Casual, albeit informed, observations of road condition suggest that only about half of the international/national roads may be in fair condition, reflecting a large backlog of periodic maintenance (requiring functional or structural overlays). Similarly, a third of the regional roads may need rehabilitation or reconstruction [2]. City roads and streets for the most part appear to be in better condition than interurban roads. Fortunately, the road network has ample capacity and traffic congestion remains manageable.

Table 1.

Condition of common use public road network, 2019

Much of the road deterioration is due to aging infrastructure, which needs both structural and safety upgrades. The upkeep of main roads reflects an intensive routine maintenance effort, as  indicated by heavily patched roads and a low incidence of potholes. However, paved roads in Uzbekistan are fairly rough, even newly resurfaced roads, pointing to the need for improved design, better construction quality control, and tighter compliance with standards and specifications.

Paved with asphalt concrete (54.4 percent), bituminous surface treated/stabilized (41.93 percent), and cement concrete (0.73 percent or 312 km).

Roads remain the prevailing inland transport mode. Over the past decade, traffic volume has grown 2–4 percent a year. Average annual daily traffic (AADT) on international roads ranges from 10,000 to 15,000 vehicles, with substantially higher volumes in the vicinity of Tashkent and other major urban centers and lower volumes in the western provinces. On national roads, the typical AADT ranges from about 3,000 to 10,000 vehicles, while on regional roads it is about 500 to 3,000 vehicles. The sustained traffic increase comes partly from Uzbekistan’s continued economic expansion, which has seen a gross domestic product (GDP) growth of more than 5 percent a year since 2016.

Expenditures in the road sector in 2016 and 2017 averaged about 1.8 percent of GDP. This compares favorably with a typical annual outlay of 1–2 percent of GDP to maintain and construct roads in Organisation for Economic Co-operation and Development (OECD) countries. The erstwhile Republican Road Fund (RRF)50 provided the lion’s share of spending on roads. From 2012 to 2018, 60– 65 percent of RRF expenditures were for road reconstruction and rehabilitation and 35–40 percent for routine maintenance and small repairs. About 3 percent of RRF’s annual budget went to finance road maintenance equipment. Over the past 10 years, the GoU has made an effort to eliminate the major maintenance backlog in the core network with sufficient funding allocated to maintain and rehabilitate international and national roads. This significant achievement, however, has come at the expense of regional and local roads, which have not received adequate maintenance funding [3].

Uzbekistan lacks revenue-generating financing mechanisms to ensure sustainability of the road network and adequate service quality. While current operations and maintenance funding may appear sufficient to keep the common use road system serviceable, it is insufficient to meet the critical needs such as safety improvements, rectification of traffic bottlenecks, pavement and bridge strengthening to accommodate the increased standard axle load limit from 11.5 to 13 tonnes, and enhancement of the road network’s climate resilience. Public expenditures are mostly directed to improve and maintain international and national (state) roads. The public expenditure share of regional and local (intraprovincial and district) roads needs to be significantly boosted to develop a balanced system that supports tourism growth, improves access to markets, serves the rural population, and allows for diversification of rural production [4].

The 2030 Road Development Plan envisages improvement of some 28,000 km of regional roads (estimated cost: US$19.6 billion) and construction/reconstruction of 8,000 km of a national highway system (estimated cost: US$6.4 billion). Fully implementing the proposed program by 2030 would require some US$2 billion a year. This compares with about US$500– US$700 million actual expenditure per year (over the last five years), of which about one-half was for current (maintenance) expenditures, leaving an annual funding gap of about US$1.5 billion. With the ongoing expansion of the road network, the maintenance budget is going to come under increasing pressure. Spending priorities must ensure a proper balance between preservation of existing road assets (especially periodic maintenance) and provision of new capacity (especially high-speed access-controlled expressways).

Results and Discussion.

 “On measures to fundamentally improve the public administration system in the field of transport” abolished the RRF. However, it continues to function as an entity within CAR, presumably to complete its pending/outstanding responsibilities, such as implementation of donor-funded projects. Sources of financing included corporate taxes, fees to register vehicles, and loans and grants from IFIs. With the abolition of the corporate tax in 2018, the RRF lost its main earmarked income and was integrated within CAR in December

Limited access to good roads in remote areas restricts access to markets, economic opportunities, and basic services for the rural population. While the more densely populated regions of Uzbekistan have well-developed road networks, many remote areas have limited or inadequate roads, inhibiting in turn the provision of public transport services. Disparities across regions in terms of access to roads and large cities remain prevalent. Basic infrastructure to ensure reliable access to socioeconomic opportunities is missing in many locations (figure 1). Small farmers and other vulnerable groups rely on rural (provincial and local) roads to access markets, economic opportunities, and social services, including schools and health care facilities. Because most of the country’s poor live in rural areas, improving local roads can make a big dent in alleviating rural poverty [5].

Figure 1. Uneven access to economic opportunities and urban markets

Note: Large city is the nearest city of 50,000 or more people.

Lack of reliable access imposes costs that go beyond discomfort or annoyance. Roads in poor condition require longer travel time, and vehicles that ply on poor roads require much more maintenance—increasing transportation costs, slowing economic development, and isolating rural populations.

Conclusions

Over the past decade, maintenance and rehabilitation of regional and local roads have not been a priority, increasing a maintenance backlog. Regional and local roads constitute 75 percent of the country’s road network and serve 90 percent of Uzbekistan’s citizens. Deferring maintenance accelerates deterioration, reduces road quality, and hastens the need for reconstruction. As a rule, investing US$1 in road maintenance can save US$4–US$8 in future rehabilitation costs, and in some instances more. Poor road conditions increase transport costs by 20–30 percent. Much of the rural road network has structurally degraded to a point where maintenance is no longer cost-effective. Moreover, rural roads have poor operational and safety features. They are in urgent need of rehabilitation and upgrading and clearly should rank high in GoU spending priorities in the transport sector.

References:

1. Jaxon Banki. “Building Blocks for Integrated Transport and Logistics Development” 2020. https://openknowledge.worldbank.org/bitstream/handle/10986/34160/Uzbekistan-Building-Blocks-for-Integrated-Transport-and-Logistics-Development-Policy-Paper.pdf?sequence=4
2. Arvis, J.-F., Ojala, L., Wiederer, C., Shepherd, B., Raj, A., Dairabayeva, K., & Kiiski, T. (2018). Connecting to Compete 2018: Trade Logistics in the Global Economy. World Bank. https://doi.org/10.1596/29971
3. O’zbekiston Respubilkasi Davlat Statistika Qo’mitasi. 2020 yil. https://stat.uz/uz/statinfo/makroko-rsatkichlar
4. Zokirkhan Yusufkhonov, Malik Ravshanov, Akmal Kamolov, and Elmira Kamalova. Improving the position of the logistics performance index of Uzbekistan. E3S Web of Conferences 264, 05028 (2021), CONMECHYDRO – 2021.  https://doi.org/10.1051/e3sconf/202126405028
5. Faiz, A. 2012. Promise of Rural Roads. Report E-C167, Transportation Research Board, http://onlinepubs.trb.org/onlinepubs/circulars/ec167.pdf (accessed December 13, 2019).