Uzbekistan on the Verge of a New Wave of Privatization and Entering Global Markets

Tashkent, Uzbekistan (UzDaily.com) — Uzbekistan has been recognized as the most active and successful market in the post-Soviet space for attracting foreign capital through privatization mechanisms and public offerings. This assessment was shared by participants in the panel discussion "Sale of State Assets and Development of Capital Markets in Emerging Economies," held within the framework of the Tashkent International Investment Forum 2026.

According to the session moderator, Giovanni Salvetti, Partner and Head of the CIS region at the investment bank Rothschild & Co, he could not name any other country that has achieved comparable results in attracting foreign investment in such a short period of time.

The reason for such a high evaluation was two landmark events that took place within a few weeks: the initial public offering of the Uzbekistan National Investment Fund (UzNIF) on the London Stock Exchange for over $600 million and the privatization of Mobiuz through a private transaction exceeding $350 million, with an investment commitment volume of more than $500 million.

According to forum participants, both deals span opposite ends of the privatization spectrum and clearly demonstrate the scale and diversity of instruments that Uzbekistan is utilizing to open up its economy.

Alisher Miraliev, Deputy Director of the State Assets Management Agency of Uzbekistan, reported that the country began large-scale privatization of major assets only in the last four to five years, after engaging international consultants and expanding its methodological base. While previously only two methods were used—exchange trading and auctions—the arsenal today includes eight instruments that comply with international best practices.

In total, the State Assets Management Agency of Uzbekistan has realized assets worth over $5 billion over the past five years. Among the next objects of privatization, he named energy facilities, infrastructure enterprises, the automotive industry, as well as insurance companies and banks. The final list of assets will be published following approval by the President of the country.

Kodirjon Norov, Managing Partner of Highland Capital Partners, drew the attention of forum participants to a qualitative turning point in the development of the local capital market. According to him, the number of trading operations on the Tashkent Stock Exchange has grown from approximately 300 per day five years ago to around 5,000 per day in the current year. The trading volume for the first four months of 2026 amounted to approximately $400 million in equivalent—already half of the record figure for the entirety of 2025. At the same time, more than 7,000 new brokerage accounts were opened within the framework of the UzNIF placement alone—a significant indicator for a country with a population of 38 million people. Norov also announced that Highland Capital Partners has completed the first closing of its fund—the first completely private equity fund in Uzbekistan—at a volume of $36 million with the participation of the IFC, EBRR, and the Silk Road Fund of China. The target size of the fund is $75 million. The investment focus is on companies in the consumer sector, pharmaceuticals, retail, and healthcare, with transaction sizes ranging from $3 million to $5 million.

Evgeny Gaisev, Executive Director for the EMEA region at Morgan Stanley, highlighted three conditions necessary for the success of UzNIF to become a systemic, rather than a one-off, phenomenon.

First, sufficient free float: according to him, inclusion in the MSCI Emerging Markets indices, which have over $2 trillion under management, is capable of providing a passive inflow of $20 billion to $40 billion into Uzbek equities—provided that companies establish target indicators for the volume of shares in free float well in advance.

Second, a stable pipeline of high-quality IPOs with carefully developed investment cases, dividend policies, and corporate governance standards.

Third, the development of local investor demand—through the system of pension funds, management companies, and retail investors. "The pool of capital oriented toward emerging markets is very deep. The question is not whether the markets are capable of absorbing Uzbek securities, but whether the country will ensure a stable pipeline of investment-attractive placements," he summarized.

David Gottlieb, Partner at the law firm Cleary Gottlieb Steen & Hamilton, revealed the legal architecture of the deal, which was assembled literally in real time. According to him, specialized privatization legislation in the modern sense did not exist in Uzbekistan, so the parties utilized a "regulatory sandbox" mechanism: three presidential decrees—in December 2025 and April 2026—successively regulated the status of depository receipts, the procedure for dual listing, the rights of GDR holders, the conversion mechanism between the London and Tashkent tranches, as well as the price stabilization structure (green shoe). The entire process from the start of work to placement took less than nine months. Gottlieb emphasized that the completed placement was secondary—meaning the state sold already existing shares. He called the next necessary step the development of a legal framework for primary offerings, where the issuer issues new shares to raise capital. A corresponding law on the capital market is currently undergoing the review procedure in parliament. "The government deserves high praise for the fact that the reform was not limited to public announcements but was implemented in practice," he stated.

Xavier Hurstel, Chairman of ADP International, whose company manages 25 airports outside of France, including in developing countries, formulated the fundamental position of strategic investors in infrastructure. According to him, the key tool for sovereign states is a concession within the framework of a public-private partnership: it ensures the inflow of private investment and management expertise while retaining the state's right to the return of the asset after 25–30 years. He named critical conditions for an investor to include the stability of concession agreement terms, protection against arbitrary changes to the tax regime, guarantees for the conversion and repatriation of revenues, as well as the liberalization of air traffic rights—as a key factor for driving traffic growth and the commercial attractiveness of airports. "Trust is built mutually. We must trust the government, and the government must trust us. It is this trust that lies at the core of a balanced concession agreement," Hurstel noted.

Tomer Pinkusiewicz, a Partner at Gibson Dunn specializing in infrastructure investments in emerging markets, highlighted several prerequisites without which American institutional investors are not ready to enter such markets. In addition to a balanced agreement with a clear allocation of risks, he pointed to the need for public political support from multiple ministries, transparency in investor selection with objective and pre-established criteria, stability of the tax regime for the entire duration of the investment, as well as an effective—not just declared—dispute resolution mechanism. He separately emphasized the importance of completed deals as the primary tool for reputation building: "Nothing speaks louder than closed deals. They are what create trust and attract the next wave of investors."

Panel participants agreed that Uzbekistan is at the beginning of a massive capital market development cycle. According to Morgan Stanley's forecast, if the current dynamics of reforms are maintained, the country could enter international emerging market equity indices within a few years, opening access to tens of billions of dollars of passive investment capital.