Uzbekistan’s Export Geography Expands to 78 Countries: Q3 Results

 

Central Asia is rapidly solidifying its position as a pivotal region on the global IT landscape. Uzbekistan is making substantial contributions to this development by actively increasing export indicators, establishing favorable conditions for ITes businesses, and advancing modern infrastructure. Moreover, the country is nurturing robust startup and venture ecosystems.  

 

The statistics are indicative of this growth: by the close of Q3 2024, the number of ITes companies delivering services abroad reached 936, reflecting a 170% increase compared to 2023. This figure represents over half of all members recorded at the end of 2023 (1,652 companies). As of the end of Q3, the total number of IT Park Uzbekistan members stands at 2,384.  

 

Within the 434 new exporting members, 223 companies specialize in IT services, including software development, technical support, refinement, and modification. Another 190 companies provide outsourcing and related services to foreign clients, while 21 companies operate within the creative industries and game development sectors.

 

 

Of these 434 new exporting members, 191 have chosen Uzbekistan's regions as the base for their business development, with the Tashkent (32 companies), Samarkand (29), and Jizzakh (17) regions proving most popular.

 

 

In comparison to the third quarter of the previous year, the export of IT services from the regions has surged by 374%, underscoring the effectiveness of initiatives to enhance human potential and infrastructure in these areas.

 

Additionally, the Zero Risk support program was introduced this year to bolster export growth. This program provides extensive opportunities for foreign exporting companies by offering office spaces, equipment, and financial compensations within Uzbekistan’s regional areas.

 

To date, 14 companies from the United States, Malaysia, Sweden, China, and other countries have utilized the program’s benefits to establish offices across the nation’s regions. This development has resulted in the creation of 570 jobs for local specialists, with an additional 1,000 positions expected by year-end. 

 

 

Export Geography:

 

Uzbekistan’s export footprint for products and services has expanded considerably, now covering 78 countries. For comparison, in 2023, exports were directed to 58 countries, marking an increase of 20 new destinations.

 

 

Approximately half of the total export volume is directed to the North American region, comprising 45% of total exports. Meanwhile, 21% of services and products are delivered to Europe and the United Kingdom, 27% to CIS and Asia-Pacific regions, and 6% to countries in the MENA region.  

 

Exports by activities:

 

 

Export Support:

 

Furthermore, IT Park Uzbekistan is is actively advancing its Local2Global program, supporting local members in expanding their exports and establishing international partnerships for outsourced IT services. In the third quarter alone, six online and offline events were organized, engaging over 125 participating companies.  

 

 

The Local2Global program was launched with a focus on the Korean market — one of the pivotal markets for IT and outsourcing. This project saw the participation of 22 IT Park Uzbekistan members. To enhance partnerships, a series of networking events and B2B forums have been organized, facilitating negotiations with 27 Korean companies. Additionally, prominent events, such as the Korean Companies Forum and the Tashkent Uzbekistan Export Consortium, were convened, featuring 10 IT companies from NIPA.

 

As a result of the Local2Global activities, outsourcing and outstaffing agreements have been established with companies from Korea, Romania, and other nations, while 12 additional partnerships currently in the process of formalizing contracts.

 

 

Foreign Company Presence:

 

Uzbekistan’s investment appeal is witnessing robust growth, driven by the favorable conditions established for developing export-oriented IT enterprises. By the end of Q3 2024, over 200 foreign-capitalized companies have been established, 89 of which are based in regional areas. On average, 25 foreign companies join the member network each month.

 

Among the new foreign members, 185 companies are exporters, planning to deliver services to markets including the United States, Canada, Germany, the United Kingdom, France, Spain, Latvia, the UAE, Saudi Arabia, China, South Korea, India, and others.

 

The founders of these new foreign companies represent 52 countries, such as the United States, Canada, the United Kingdom, Germany, France, Estonia, China, Japan, South Korea, Singapore, the UAE, India, and beyond.

 

Notably, 84 companies with foreign capital were established in collaboration with Uzbek partners.

 

 

Job Creation:

 

One of Uzbekistan's primary objectives as an IT hub is to generate new employment opportunities for local specialists. By the end of Q3 2024, the total number of employees among the members of IT Park Uzbekistan reached 36,300, representing an increase of 10,000 compared to the end of 2023. Of this total, 17,000 individuals are employed in export-oriented companies.   

 

It is noteworthy that the number of jobs in regional areas is experiencing significant growth — the number of employed specialists outside the capital has now reached 8,200, reflecting an increase of 4,500 since the beginning of 2024. This trend is attributed to the rising interest in IT among the youth in various regions of the country.

 

 

Development of the Startup Ecosystem:

 

From January to September of the current year, startup members of IT Park Uzbekistan successfully attracted investments totaling over $124.7 million, with the number of promising startup projects increasing to 200.

 

The cumulative amount of investments secured by these startups has surpassed $141 million.

 

 

In 2024, various foreign venture capital funds have invested in Uzbek startup projects. For instance, Arzon Apteka, a startup project of FOM Group, successfully raised $6 million. Furthermore, the startups Zip24 and Zypl AI received investments from the international company Plug and Play, which contributed approximately $375,000 to Uzbek startups.

 

In addition, local venture funds, including AloqaVentures, UZVC, and Uzcard VC, have invested around $1 million in the advancement of Uzbek startups.

 

 

Distribution of Startups by Sector (%):

 

 

Distribution of Startups by Stage (%):

 

 

On September 18, 2024, during the Startup & Venture Summit held in Uzbekistan, IT Park Uzbekistan and Astana Hub signed a memorandum to establish a joint alliance known as the Central Asian Innovation Hubs. This partnership will provide Central Asian startups with opportunities to showcase their projects in the international market and participate in significant global incubation and acceleration programs.

 

 

IT Park Uzbekistan has signed a memorandum with Activat VC to enhance cooperation in the development of the startup ecosystem and expansion of venture investments. This agreement represents a significant step toward supporting innovative growth and strengthening opportunities for emerging startups.

 

 

Additionally, IT Park Uzbekistan and Xsolla, a global leader in business solutions for the video game industry, have signed a Memorandum of Understanding (MoU) to establish Uzbekistan’s first GameDev Academy. This initiative aims to cultivate local talent and foster the growth of the gaming industry, positioning Uzbekistan as a promising destination for game development.

 

 

International Activities:

 

IT Park Uzbekistan, in collaboration with The World Bank, has successfully concluded an agreement to initiate a strategically significant project entitled Uzbekistan Digital Inclusion, which has garnered investments totaling $50 million. This initiative is designed to equip the citizens of Uzbekistan with essential digital skills across various regions, particularly focusing on vulnerable populations. The project is anticipated to create over 25,000 job opportunities and train 6,000 specialists, with 50% of the trainees being women and 4% comprising individuals with disabilities.

 

In addition, to enhance Uzbekistan’s recognition on the global IT landscape and to present the opportunities available for conducting ITes business within the country, IT Park Uzbekistan organizes a series of local and international events. A delegation from IT Park Uzbekistan, which includes prominent member exporters, actively participates in international conferences and exhibitions.

 

 

For example, the Uzbekistan Outsourcing Conference is conducted abroad on a monthly basis, organized by IT Park Uzbekistan to draw attention to the country's outsourcing potential. From the beginning of 2024 until the end of September, 12 such conferences were held in the United States, the Republic of Korea, Germany, Japan, the UAE, Qatar, and other countries, collectively attracting over 1,200 representatives from the ITes sector in the targeted markets. As a result of both local and international events, more than 24 agreements and memorandums of understanding regarding joint activities have been established. 

 

Between January and September, 10 major events were conducted in Uzbekistan, organized by IT Park Uzbekistan with the support of the Ministry of Digital Technologies. These included the Offshore Outsourcing Tour, held from March 18 to 20 in Tashkent and Samarkand, the Global Business Services Forum on July 24-25, and eight events as part of ICT WEEK UZBEKISTAN 2024.

 

The Offshore Outsourcing Tour lasted for three days and attracted over 200 representatives from 150 foreign companies. As a result of the conference, 10 companies with foreign investment were established.

 

The Global Business Services Forum attracted more than 200 attendees from the outsourcing and ITes industries. The event featured a TechExpo, a conference, visits to technology companies and universities, as well as several B2B meetings. Consequently, more than 10 companies were established as a result of the Global Business Services Forum, with an additional 30 currently considering Uzbekistan as a viable outsourcing location.

 

 

During ICT WEEK 2024, IT Park Uzbekistan organized eight exclusive events that collectively brought together over 1,100 participants, including more than 250 representatives from foreign companies across 51 countries. Fourteen companies registered their legal entities in Uzbekistan during the event, while an additional 13 are in the process of registration. A notable achievement of this week was the attraction of investments totaling $640,000 through initiatives such as the Startup Pitch, Investor’s Room, and President Tech Award Hackathon.

 

 

Furthermore, the delegation from IT Park Uzbekistan and member companies participated in more than 15 large-scale international conferences and exhibitions, including Web Summit Qatar, Dubai Fintech Summit, and Startup Autobahn by Plug and Play.

 

In collaboration with KIIIC, the Uzbek-Korean IT Business Alliance was established to promote bilateral cooperation and enhance the representation of technology companies from the Republic of Korea in Uzbekistan, thereby contributing to the improvement of Uzbekistan’s export indicators. In July, a Korean representative office was opened in Tashkent.

 

Long-Term Investments:

 

This year, the Ministry of Digital Technologies and IT Park Uzbekistan signed an agreement with EY to jointly develop an International Center for Digital Technologies, named Enterprise Uzbekistan.

 

 

Enterprise Uzbekistan will serve as a free economic zone for technology companies within IT Park Uzbekistan. This zone will feature a specialized legal framework tailored to the IT sector, enabling companies to develop and test innovations, services, and corporate products in the digital sphere. The initiative introduces favorable business conditions, encompassing taxation, customs regulation, labor relations, banking and finance activities, as well as the protection of intellectual property and personal data.

 

 

In collaboration with DataVolt, the construction of data centers powered by renewable energy has also commenced. Under an agreement signed at ICT WEEK, up to $5 billion is expected to be invested in projects within Uzbekistan by 2030. All data centers will operate on renewable energy sources, with DataVolt committed to attracting major international IT companies to Uzbekistan upon completion.

 

The launch of Enterprise Uzbekistan and green data centers in partnership with DataVolt will help position Uzbekistan as a global leader by creating favorable conditions for business and IT industry development, significantly enhancing the country’s appeal to investors.

 

The results from the third quarter vividly illustrate that Uzbekistan is steadfastly transforming into a global IT hub. The accelerated growth in exports, the emergence of new international partnerships, and the increasing interest from foreign companies and investors collectively indicate that the IT landscape of the country is becoming progressively more appealing to international companies. This transformation not only facilitates the creation of new career opportunities for local specialists but also exerts a favorable influence on the overall expansion of the digital sector within the national economy.