FINANCING MECHANISMS FOR PPP PROJECTS IN UZBEKISTAN:OPPORTUNITIES AND CHALLENGES

Abstract

Uzbekistan has emerged as one of Central Asia's most dynamic economies, launching an ambitious infrastructure modernisation programme under its New Development Strategy 2022–2026. Despite the enactment of the Public-Private Partnership Law No 543 in December 2019 and subsequent institutional reforms, the country's PPP project pipeline remains constrained by a fundamental financing bottleneck. This article examines the spectrum of financing mechanisms theoretically and practically available for PPP projects in Uzbekistan, assessing their feasibility against the country's existing legal, institutional, and capital market environment. Drawing on an analysis of multilateral development bank country strategies, legal texts, sovereign macroeconomic assessments, and comparative PPP market data from peer economies in the region, the article maps eight distinct financing instruments—ranging from MDB sovereign loans and commercial project finance to blended finance structures, Islamic sukuk, and green bonds—and evaluates the opportunities and structural challenges each presents. The findings indicate that, while Uzbekistan benefits from improving macroeconomic fundamentals, growing MDB appetite, and untapped Islamic finance potential, the absence of codified lender step-in rights, shallow domestic capital markets, persistent currency risk, and institutional capacity gaps continue to impede private financiers.