Uzbekistan says it will liberalize its currency regulations, no longer fixing the sum to the U.S. dollar and removing restrictions on the amount of foreign currencies individuals and companies can buy.
Reuters reported on September 3 that Uzbekistan will allow its citizens and companies to buy and sell foreign currency without restrictions at a market rate, taking a major step towards opening up its economy to badly needed foreign investment.
According to a decree published on Uzbek President Shavkat Mirziyoyev’s website on Sunday, the reform, which confirms a Reuters report published last week, takes effect on Tuesday,
Reuters news agency reports that since being elected in December, Mirziyoyev has moved to gradually liberalize the country’s sum currency, allowing some companies and banks to trade it at a market rate and scrapping mandatory foreign currency sales last month.
The decree reportedly removes most restrictions on foreign currency operations by individuals and businesses in Uzbekistan. However, when buying foreign currency, Uzbek citizens will have it transferred onto special bank cards rather than being handed cash.
The document also instructs the central bank to run a tight monetary policy to ensure the sum’s stability. It states that the sum’s exchange rate must only be determined by market factors, but provides no figures.
Foreign companies have largely stayed out of the resource-rich nation of 32 million because decades-old regulations forcing most businesses to sell foreign currency at a knockdown official rate while buying it at a much more costly one.
As of Sunday, the official rate of the sum – set by the central bank – stood at 4,210 per dollar while the black market rate was around 7,700 per dollar.
The government in a website posting on September 3 said the move would take effect on September 5.
