Scepticism Over Claims of Rising Uzbek Incomes
Scepticism Over Claims of Rising Uzbek Incomes
The UN’s Human Development Report for 2009 says that around 77 per cent of the population of 27 million lives below the poverty line, set at two US dollars a day, while 8.5 per cent live in extreme poverty
Yelena Danilova, human development coordinator at the UN Development Programme office in Tashkent, said, “Last year, there was a substantial decline, but this year, based on official statistics, we can say that real incomes in the public sector have increased substantially.”
In August, the authorities announced a further rise in pensions and wages. The minimum wage is just over 22.5 dollars a month, while a public-sector worker can expect to earn an average of 210 dollars. Average pensions are 45 dollars a month.
NBCentral Asia experts say the majority of Uzbeks are experiencing financial problems due to delays in paying wages and a general shortage of cash in circulation.
High inflation and the devaluation of the Uzbek national currency have also cut real earnings.
Previous NBCentralAsia reports highlighted problems created by the shift to paying wages and pensions by plastic cards rather than in cash, as it is difficult to withdraw money. (See Uzbek Pensioners Reluctant to Switch to Plastic Cards, 31-Jul-09.
Now, some months later, the situation has got worse as the authorities have started delaying payment of pensions, benefits, and salaries. The reason seems to be a cashflow problem as money is diverted to fund the all-important cotton harvest.
“They’ve begun to stop transferring money to the plastic cards, and the bank employees are saying the state is using all its funds to buy cotton from farmers,” said Tashpulat Yoldashev, an Uzbek political analyst based abroad. “There isn’t enough money left over to make these payments.
A staff member at the National Bank for Foreign Economic Activity who requested anonymity said that while salaries had risen, bank managers had simultaneously cut some of the benefits that go with the job, for example transport and meal subsidies.
“The nominal incomes of many public-sector employees have therefore remained the same as before,” she said.
Another factor that has dented household incomes is the compulsory deduction of utility payments from people’s wages. (For more on this, see Uzbekistan: Outcry at Compulsory Utility Payments, 20-May-09, and Cash Shortage in Uzbekistan, 29-Apr-09.
Jahongir Shosalimov, an independent economist in Tashkent, believes real incomes in Uzbekistan have fallen by 30 or 40 per cent over the past few years.
The major reasons for this, he said, were the sharp drop in the money sent home by migrant workers abroad, which he now puts at 20 per cent of earlier volumes; and restrictions placed on exports of fruit and vegetables.
“Many people have lost their income source. A significant proportion of the population earns their income from their allotments and farms,” said Shosalimov.
(NBCentralAsia is an IWPR-funded project to create a multilingual news analysis and comment service for Central Asia, drawing on the expertise of a broad range of political observers across the region. The project ran from August 2006 to September 2007, covering all five regional states. With new funding, the service has resumed, covering Uzbekistan and Turkmenistan.)
