Jamshid Kuchkarov: “In a market economy, prices should be free”

Tashkent, Uzbekistan (UzDaily.com) – Finance Minister of Uzbekistan Jamshid Kuchkarov Jamshid Kuchkarov said that the tariffs set for energy resources must comply with the principles of the market economy, and therefore their increase is inevitable.

At the same time, the establishment of a real price for these resources should contribute to the improvement of the economic situation of enterprises of the relevant industries.

The Minister of Finance said that tariffs for all energy resources will increase by an average of 18 %. At the same time, the increase in prices for gasoline, diesel fuel, natural and liquefied gas, coal, electricity, heating and drinking water will occur from 15 August.

This trend of rising energy prices Jamshid Kuchkarov justified as follows:

"The price increase is not an issue that can be solved by the Ministry of Finance, the Ministry of energy or any other statement. These are the realities of a market economy. If prices in the market are not free, it will be impossible to establish an objective value and correlate it in the future.”

“In fact, energy prices were supposed to rise on 1 June. We planned to charge for the sum of 480 per 1 kWh. However, the President was against it,” Jamshid Kuchkarov said.

The Minister also answered the reporter’s question on whether the agreement with LUKOIL, which was actively discussed, can be revised or terminated:

— The agreement with LUKOIL is not subject to revision, as it is an international agreement. If we renegotiate the contracts or terminate them, we will lose confidence.

Deputy Chairman of Uztransgas Murodulla Basmanov explained this situation as follows: “The export of natural gas has an impact on domestic consumption. This was the reason for the debt to LUKOIL. It doesn’t really have to be that way. This situation was the result of some errors in the balance sheet last year. We bought a thousand cubic meters of gas from LUKOIL for 146 dollars and sold it to the population for 40 dollars. As a result, the company incurred significant losses. It’s our fault and we have to fix these mistakes ourselves. At the same time, consumers should not suffer.”

Jamshid Kuchkarov added that energy tariffs will continue to rise. However, he did not give a specific date when this could happen.