II. Country Assessments and Performance Measures - Uzbekistan

U.S. Government Assistance to and Cooperative Activities with Eurasia
Bureau of European and Eurasian Affairs
January 2005
Report

Map of UzbekistanArea: 278,000 sq miles, slightly larger than California
Population: 26,410,416 (July 2004 est.)
Annual Inflation: 13.1% (2004 est.)
Population Growth Rate: 1.65% (2004 est.)
Gross Domestic Product (GDP): $43.99 billion (purchasing power parity, 2004 est.)
Life Expectancy: Male: 60.67 years; Female: 67.69 years; (2004 est.)
GDP Per Capita: $1,700 (purchasing power parity, 2004 est.)
Infant Mortality: 71.3 deaths/ 1,000 live births (2004 est.)
Real Annual Growth: 3.1% (2004 est.)

U.S. STRATEGIC INTERESTS

Uzbekistan's relatively large population (which accounts for forty-five percent of the population of Central Asia), strategic location north of Afghanistan, and extensive mineral resources, including gold and uranium, make it a potential force for economic growth and stability in the Central Asia region. Uzbekistan is also the only Central Asian country that borders on all the other nations of the region (Kazakhstan, the Kyrgyz Republic, Tajikistan and Turkmenistan), as well as Afghanistan. Uzbekistan provided critical early support to Operation Enduring Freedom (OEF) by allowing the U.S. Government (USG) to use its Karshi-Khanabad base, which is less than an hour north of Afghanistan. Uzbekistan inherited some unconventional-weapons infrastructure from the Soviet Union and is cooperating fully with the USG to secure, convert, or dismantle this infrastructure. Terrorist attacks that took place in Uzbekistan in March and July 2004 underline both that the threat remains real and that it is in U.S. and Uzbekistan's interest to promote democratization, respect for human rights, rule of law, territorial integrity, and the transition to a market-based economy in order to bolster greater social and political stability.

OVERVIEW OF U.S. GOVERNMENT ASSISTANCE

In FY 2004, the USG provided an estimated $101.88 million in assistance to Uzbekistan (including $30,000 in FY 2003 FREEDOM Support Act funds):

  • $18.90 million in democratic reform programs (including Public Diplomacy exchange programs) 

  • $6.94 million in economic reform programs; 

  • $39.01 million in security, regional stability and law enforcement programs; 

  • $14.16 million in social-sector reform programs; 

  • $5.38 million in humanitarian programs; 

  • $1.08 million in cross-sectoral and other programs; and 

  • privately donated and U.S. Defense Department excess humanitarian commodities valued at $16.41 million.

In FY 2004, the Secretary of State could not make the determination required by section 568(a) of the Foreign Operations Appropriations Act that Uzbekistan was meeting its commitments under the 2002 Strategic Partnership Framework, thereby prohibiting FY 2004 assistance to the central Government of Uzbekistan (GOU). In order to continue programs with the central GOU that advance the interests of the United States, the Coordinator of U.S. Assistance to Europe and Eurasia is relying on the notwithstanding authority originally provided for one year in section 498B(j)(1) of the Foreign Assistance Act, and renewed annually since then in the NIS heading of each Foreign Operations Appropriations Act. Notwithstanding authority has been invoked for the following programs:

  • Human rights dialogues with officials of the Government of Uzbekistan; 

  • Health care reform, infectious diseases, maternal and child health/reproductive health, and health partnerships; 

  • Technical assistance to achieve World Trade Organization accession; 

  • Anti-torture programs and programs to address trafficking in drugs and persons.

In FY 2004, some 292 Uzbek citizens traveled to the United States on USG-funded training and exchange programs implemented by the Open World Leadership Center, USAID and the U.S. Departments of Agriculture, Commerce and State, bringing the cumulative number of Uzbek participants to over 3,160.

U.S. ASSISTANCE PRIORITIES

Democratic Reform Programs

In FY 2004, the main priorities for USG democratic reform assistance included promoting human rights, combating trafficking in persons, assisting the development of independent political parties, fostering an independent judiciary, assisting in the professional development of young lawyers and the provision of legal aid to citizens, and enhancing civic participation through the growth of independent media, cooperative housing partnerships, and a strong non-governmental organization (NGO) sector. These programs not only produced real improvements in people's lives, but also provided them with practical experience in how a civil society functions. The USG plans to continue these programs in FY 2005 as part of its long-term strategy of promoting human rights and democratization through development of civil society, a better-informed populace and improved access to technical assistance and services in areas such as condominium associations, a shelter for trafficking victims and legal aid.

Economic and Social-Sector Reform Programs

In FY 2004, due to a lack of demonstrated commitment by the Uzbek Government to undertake necessary economic reforms, the USG ceased to provide economic advice and analysis to senior policy makers through the Department of Treasury. As a result of the non-certification decision, the USG also ended technical assistance to think tanks associated with the economic ministries. Employing notwithstanding authority in order to advance the U.S. interest of encouraging trade in Central Asia, the USG continues to provide an advisor to help the Uzbek Government in its efforts to accede to the World Trade Organization. USG-supported private microfinance institutions and credit unions have shown impressive growth, reflecting a huge unmet demand for finance by micro-entrepreneurs in an over-regulated economy. USG experts are helping to ensure full implementation of international financial reporting standards at small and medium-sized enterprises and are training accountants in these standards. Using FY 2003 funding, the USG is assisting the GOU in the development of regional energy and water trading and exchanges with neighboring states through technical assistance to agencies responsible for developing a legal and regulatory framework in order to improve transboundary energy and water management. In the water sector, the USG has initiated activities aimed at assisting the farming industry develop a set of policies and practices that will improve the vital irrigation sector. Over sixty-five percent of Uzbekistan's 26 million people rely on this sector for their livelihood. The USG is also supporting newly formed Water User Associations to improve management of local water systems through training and grants. USG assistance led to Uzbekistan's three successful applications to the Global Fund to Fight AIDS, Tuberculosis (TB) and Malaria, for $24.5 million, $13.7 million, and $2.4 million in grants, respectively. USG efforts to control these three infectious diseases made other significant progress, with an HIV surveillance system launched, drug demand reduction programs targeting high risk groups introduced and treatment with the World Health Organization's international DOTS approach expanding into new sites in the country. USG assistance in the area of education is improving the quality of basic education through in-service teacher and school principal training, distribution of teaching materials featuring modern methodologies, promotion of parent and community involvement in education, and pilot activities in education finance. In response to a request from the Government of Uzbekistan, the USG has provided more than 1,000 computers to secondary schools throughout Uzbekistan and trained nearly 5,000 teachers and many community members in basic computing skills.

Security, Regional Stability and Law Enforcement Programs

Using remaining FY 2003 funding, USG security-related assistance was focused on supporting the Uzbek Government's efforts at military reform, improving Uzbekistan's counter-proliferation capabilities, promoting regional cooperation, and improving border security to help stop the flow of illegal narcotics, weapons of mass destruction (WMD), and other illicit items through Uzbekistan. The USG provided a variety of non-lethal security-related equipment and training to the Uzbek military, thereby ensuring its communications interoperability with U.S. and Western military forces, strengthening its counter-terrorism capabilities, and also promoting military reform and regional stability. Likewise using prior-year funding, the USG helped Uzbekistan dismantle its remaining biological-weapons programs and prevent the proliferation of these weapons, their delivery systems, and related expertise to rogue states. The USG also helped Uzbekistan strengthen its institutional capacity to stop trafficking of illicit narcotics across its borders. USAID has initiated a series of activities designed to mobilize communities and, by promoting inter-ethnic cooperation, alleviate the underlying sources of conflict. USG programs and training assistance in 2004 resulted in key legislative progress on criminal justice reform.

SECTORAL ASSESSMENTS

Democratic Reform

Overall, Uzbekistan's human rights record remained poor in FY 2004. While the Government took some important steps to address torture and to establish police accountability, it made no progress with democratic reform and placed further restrictions on the activities of nongovernmental organizations and the press.

Although the Government allowed independent parties to organize, no independent party was registered for the December 2004 parliamentary elections. A number of initiative groups formed to nominate independent candidates, but none succeeded in successfully registering a candidate by the deadline. While no opposition parties or truly independent candidates will participate in the December elections, the USG continued to provide trainings and technical assistance to both opposition movements and officially registered parties, one of which has begun to exhibit a few signs of independence from the official party line. Only through continued training and technical assistance of independent leaders and parties will Uzbekistan witness real democratic development.

As an example of the Government's active measures to arrest this democratic development, it took a number of steps in FY 2004 to restrict the activities of international technical assistance organizations. In April, the Government forced the Soros Foundation Open Society Institute to cease its activities in Uzbekistan. The Government continued to deny registration to several independent domestic human rights groups and increased pressure on non-registered groups. The Government attempted to restrict the activities of other international NGOs, including several USG implementing partners. New registration, banking and activity notification restrictions issued in December 2003 apply to all international technical assistance programs, but the resulting interference appears to particularly target USG-funded democracy programs. New banking restrictions made it difficult for USG-funded programs to make grants to local NGOs, affecting civil society programs the most. With strong USG support, however, most programs have been able to continue their work, albeit with difficulty, despite these new restrictions.

The Government took steps to improve its record on torture. The Supreme Court passed legally binding decrees that brought the definition of torture into conformity with international standards, established that suspects have a right to defense counsel from the moment of detention, and ruled that evidence and testimony obtained through torture is inadmissible in court. In May, the Government for the first time invited international experts to oversee its investigation into a death in custody and the police and security services opened a dialogue with human rights activists. Arrests of persons suspected of involvement in extremist Islamic political groups continued. In March 2004, the Uzbek Government concluded a three-month amnesty process, in which 704 such prisoners were released.

The U.S. Secretary of State, per Section 568(a) of the Foreign Assistance Act, could not make the determination that Uzbekistan was meeting its commitments under the 2002 Strategic Partnership Framework this year, making it ineligible to receive any FY 2004 support to the Central Government, some of which was reallocated to other programs in an effort to improve the overall environment for democracy, and other funds were moved to other countries.

In FY 2004, the USG continued to provide assistance to NGOs, both international and domestic, in their efforts to build a strong civil society. USG-supported human rights resource centers provide an environment where human rights defenders and activists are able to access vital information on the Internet, receive training and conduct meetings. Legal consultations and training for law students was provided through a human rights legal clinic at Tashkent State Institute of Law, a second clinic at Andijon State University and five Public Defender Centers, which provide criminal defense for indigent clients.

One of the USG's top human-rights priorities in Uzbekistan has been combating trafficking in persons. By means of notwithstanding authority in FY 2004, the USG has funded anti-trafficking initiatives and facilitated a collaborative relationship between the Uzbek Government and local NGOs. These efforts have shown significant growth over the year. In November 2004, the U.S. Department of Justice, Office of Overseas Prosecutorial Development Assistance and Training (OPDAT), in partnership with the OSCE, hosted a joint workshop for law enforcement and NGOs from all the regions to plan and develop concrete strategies for cooperation. Working together, the U.S. and Uzbek Governments and the local Uzbek NGOs have also continued running innovative public education campaigns on prevention and prosecution of trafficking throughout the country. Uzbek law enforcement has further demonstrated a strong commitment to curbing trafficking by establishing special internal units, including new units in both the Ministry of Internal Affairs (MVD) and the National Security Service (NSS) to handle human trafficking cases. These agencies, along with the Prosecutor General's Office, have agreed to participate in a project funded with FY 2004 notwithstanding funds that is being implemented by OSCE, to form an interagency working group devoted to human trafficking issues. In late 2004, the NSS, MVD and the Prosecutor General's Office each designated two officials to serve on this working group. Such interagency cooperation is vital to sustained success in curbing human trafficking. The USG also helped the Uzbek Government train consular and law enforcement officials, prosecutors, and employees of other government agencies to recognize and protect victims of trafficking and to combat trafficking rings. The Uzbek Government has made significant progress in combating trafficking in persons, including the development of a national action plan. This progress was reflected in the fact that Uzbekistan stayed in Tier II in the State Department's Global Trafficking in Persons report rankings during 2004.

Another key objective of USG assistance is to build civil society by fostering the growth of local NGOs. USG continued to support a national network of seven NGO resource centers. The organizational mission of these centers is to enhance the quality of NGO advocacy skills, as well as their organizational and financial capacities. With the help of small grants from the U.S. Embassy's Democracy Commission, human-rights groups provided some of the best reporting on human-rights violations in the country, specifically in cases relating to religious extremism. Human rights groups also conducted seminars on rights of the disabled for family members and warned people about the risks of trafficking in persons, highlighting the arrests of traffickers by Uzbek law enforcement authorities. The Embassy Democracy Commission in FY 2004 provided 38 grants valued at USD 204,000 to Uzbek NGO's working in the fields of human rights and democratic development.

Although Uzbekistan officially abolished censorship of the media in FY 2002, the USG detected no improvement in press freedom in FY 2004. Journalists and editors who reported views contrary to government policy continued to be harassed and intimidated by government officials. Roughly eighty percent of media in Uzbekistan is state-owned. Throughout the country, privately owned newspapers are typically tabloids that reprint Russian media reports but do not report on Uzbek political issues. The President's administration has continued to pressure those few independent media outlets that exist in the country to broadcast and publish the information that serves the interests of the central government. The number of lawsuits against outspoken journalists has not decreased from the previous years. One independent television station had its license suspended and remains off the air; three other independent television stations had their licenses temporarily suspended. In addition, the Uzbek Government suspended Internews Uzbekistan, a local media non-governmental organization (NGO), for six months. Its primary activities in 2004 were monitoring the violations of freedom of speech and advocating for free access to information and journalists rights in Uzbekistan; the organization was suspended by the Tashkent city court ostensibly for technical violations related to the organization's internal management and documentation rather than on issues related to programs and activities.

Despite all the difficulties this past year in Uzbekistan, the USG continued to provide assistance to independent television and radio stations throughout the country through production grants, training opportunities and legal defense. Three weekly USG-supported information programs (Zamon, Jarayon, and Open Asia) are being broadcast by independent television stations in several cities of Uzbekistan, providing Uzbek citizens with the only alternative information on events happening in their country and in neighboring Central Asian Republics.

In FY 2004, USG-funded exchange programs provided Uzbekistan's future political, economic, religious, and civic leaders an opportunity to view how concepts such as the rule of law, transparency, freedom of speech, and religious pluralism are applied on a day-to-day basis in the United States. The USG worked with state-controlled media journalists to give them exposure to Western-style reporting. In FY 2004, eight prominent Uzbek journalists participated in a Freedom House-organized media exchange-training program, which allowed them to live and work with U.S. media organizations. Two teams of Uzbek National TV journalists visited the U.S. to work with State Department Public Affairs to produce TV documentaries entitled "Drug Interdiction in the U.S." and "Small Business Development." Following the TV co-op programs, Uzbek National TV channels aired prime time reports and feature documentaries that reached millions of Uzbek TV viewers.

During FY 2004, the Library of Congress-funded Open World program sent 48 Uzbek participants to the U.S. to spend two weeks with their U.S. counterparts to learn about health, economic development, media, and rule of law. The Community Connections program sent 52 Uzbeks to the U.S. for four weeks on professional programs with their American counterparts to learn about secondary school administration, business entrepreneurship, small and medium-size business development, and Islam in the U.S. Approximately 40 Uzbek community and religious leaders including imams visited the U.S. in FY 2004 through the USG-funded International Visitor's program, Community Connections program, and Cultural and Religious Pluralism program. The focus of these kinds of programs is to provide Uzbek religious leaders with exposure to a U.S. model of cultural and religious diversity in which many different religious belief systems coexist in harmony. As a result of their visits, many of the imams have discussed religious tolerance and pluralism with their congregations, furthering the U.S strategic goal for social stability. The Future Leader's Exchange Program (FLEX) sent 119 high school-aged Uzbeks to the U.S. to live with American families and attend an American high school for one year. Also in FY 2004, the Contemporary Issues, Edmund S. Muskie, Eurasia Undergraduate, and Fulbright programs sent more than 40 Uzbek university students and faculty members to U.S. universities for programs ranging from four-month internships to two-year graduate degree programs. 40 Uzbeks traveled to the U.S. under the International Visitor's program for programs on urban planning, neighborhood and youth leadership, criminal investigation training, and fiscal reform and tax policy.

USG public diplomacy programs sought to increase Uzbek citizens' access to unbiased information by supporting independent TV and radio stations and by expanding Internet access and Internet literacy -- especially outside of Tashkent. The Internet Access and Training Program (IATP) operated and maintained 18 public access Internet sites throughout Uzbekistan. More than 22,000 Uzbeks visited these sites and another 8,000 received specialized training during FY 2004. These centers are an important source of uncensored information and are especially critical outside of Tashkent. Less than two percent of Uzbeks currently have access to the Internet.

In FY 2004, the Public Affairs Section opened the first two American Corners in Uzbekistan in Termez and Andijon. The American Corners are small American book collections located in key regional libraries serving local youth. In the case of Termez, more than 1,700 young Uzbeks visit the American Corner each month. American Corners provide a cost-effective way to conduct outreach to the 24 million Uzbeks who live outside of Tashkent.

USAID's conflict prevention activities focused on the Ferghana Valley and southern Uzbekistan, where high levels of unemployment, large disparities in wealth distribution, and ethnic groups vying for access to limited resources have created a tense environment. These programs are designed to mobilize communities by providing grants for small-scale infrastructure and social projects identified and supported by the community through a democratic process that engages local authorities. An equally important objective of these programs is to alleviate the underlying sources of conflict by promoting inter-ethnic cooperation, economic development, and the rehabilitation of the areas' social infrastructure. Thirteen infrastructure and sixteen social projects, with as many as 37,797 ultimate beneficiaries, were completed this fiscal year including advocacy trainings, civic education trainings for teachers, women leadership trainings and trainings for potable water committees. Ninety-two percent of community projects received support from local governments for their implementation, demonstrating an increase in local government awareness of community-based issues and pointing to opportunities for improved dialogue and understanding between citizens and their government counterparts.

FY 2004 also saw some incremental but crucial steps in improving and expanding the dialogue between law enforcement and civil society. In a study trip organized by USG-funded NGO Freedom House, partially funded by OPDAT and UNDP, several top law enforcement officials and human rights defenders traveled to Slovenia to learn about the transformation of government institutions in making the transition from socialist to democratic state. Notwithstanding authority was employed to ensure this vital assistance to combat the use of torture continued in FY 2004.

Economic and Social-Sector Reform

In FY 2004, Uzbekistan continued to enact policies driving the country further away from a market economy. The Government continues to focus only on macroeconomic stability by taking in as many reserves as possible, keeping inflation low with deliberate restriction on access to local currency (the soum), and stifling any independent trading market. Uzbek Government economic policies and reluctance to implement true market reforms have created a difficult environment for all local and foreign businesses. Civil unrest and terrorist attacks that took place in March 2004 at Tashkent's most visible bazaar delayed some of the Uzbek Government's plans to further restrict trade in consumer goods. Earlier decrees that abolished all unregistered traders were not enforced for a time following the attacks. In August 2004, however, a decree mandating registration of all traders and enforcing strict import requirements was enacted, though not enforced until November. Enforcement of the decree caused more civil unrest in some regional bazaars, and further enforcement has been informally postponed until January 2005. Despite this apparent setback for the Uzbek Government to further control individual trade, arbitrary excise taxes and customs fees remain dramatically high, dampening the prospect for imports even for large legal businesses and officially registered small and medium enterprises (SMEs).

The only positive movement that the GOU has made in the last year to signal interest in true market reform is its efforts toward WTO accession. Notwithstanding authority was employed to ensure that USG assistance continued to the GOU on WTO accession, assistance which has produced several positive steps, including the creation of a dedicated WTO Small Council, revision of several legislative acts that impede foreign trade, the GOU decision and legislation implementation needed to join the Berne Convention on the Protection of Intellectual Property Rights, as well as a successful Working Party with WTO members in Geneva in June. The next Working Party meeting is expected in early 2005.

The legal and operational environment for microfinance has remained challenging with unclear legal status and omnipresent cash withdrawal restrictions. Some credit unions have not been able to withdraw cash from their accounts for eight months. Notwithstanding such difficult operating conditions, USG-supported microfinance institutions and credit unions have all posted impressive growth rates. A microfinance institution in Andijon opened four branches in surrounding regions, introduced a highly successful new loan program for greenhouses, tripled its loan portfolio, now in excess of $500,000, and has reached full operational sustainability. Credit unions supported by one USG grantee continued to experience strong business growth despite extremely tight cash controls, with total assets reaching $2.3 million and savings growing to $1.9 million, compared to $600,000 and $437,000, respectively, in September 2003. The combined client base of microfinance institutions and credit unions supported by the USG exceeded 22,000 vs. a target of 16,000 for FY 2004. The result demonstrates a vast unmet demand for financial services in Uzbekistan, despite over-regulation and trade restrictions.

USAID's Enterprise Development Project delivered business and trade advisory services to 102 small and medium enterprises in Tashkent and Ferghana City. Results included a forty-three percent increase in sales, a thirty-nine percent increase in productivity, and 65 USAID-facilitated trade deals with a total value of over $10.1 million. A Pilot Productive Project on sorting and packing greenhouse vegetables for export was launched in Andijon to fill holes in the supply chain by establishing pilot agro-industrial facilities with the intention that other entrepreneurs would see their profitability and be motivated to establish similar facilities with their own funds or commercial credit.

USAID continued to support the Certified International Professional Accountant (CIPA) training, testing and certification program, which is the first and still only regional professional accountant certification program in the Russian language that meets international standards. CIPA's growing regional success and recognition has caught the attention of potential partners in a USAID Global Development Alliance, including the International Accounting Standards Committee Foundation and the American Institute of Certified Public Accountants. In the past year, 172 accountants passed exams required for the Certified Accounting Practitioners designation. This exceeds the target of 110 that was set for FY 2004.

In response to the Uzbek Government's expressed interest to undertake agricultural reforms, the USG developed several activities in the sector. Several large irrigation water projects were completed in the past year that included infrastructure repairs, equipment upgrades, improvements to communication and data collection systems and technical assistance to Water User Associations, which are NGOs that manage water resources on the local level. Demonstration models, training and public outreach programs have resulted in increased food production, crop yields, rural incomes and water savings. One of the largest of these took place in the Surkhandarya Oblast on the Afghanistan border. The USG also completed a potable water project in the western areas of Karakalpakstan, an autonomous republic within Uzbekistan, and one of the most desolate parts of Central Asia. The project accomplished the following: 1) increased access to potable water by rehabilitating a key water pumping station that brings water to over 160,000 people in the oblast capital of Nukus; 2) provided supplies and equipment needed for maintenance on existing pipelines that serve more than 330,000 people; 3) extended the drinking water delivery system to 50,000 additional residents through the provision of piping, equipment and work vehicles; and 4) installed three chlorination systems for water disinfection for two cities located outside of Nukus, with a combined population of 180,000. This was a significant humanitarian effort aimed at improving both the health and economy of the region. After two months of operation, the new pumping system demonstrated a five-fold reduction in energy consumption, while delivering the same amount of water to the distribution system. The USG also initiated two new projects aimed at providing more extensive assistance to Water User Associations; and to assist democratically organized farmer groups gain greater access to markets for their products. In order to build Government capacity to implement privatization reforms at the managerial level within the Ministry of Agriculture and other related Uzbek Government agencies, 23 Uzbeks participated in USDA's Cochran Fellowship and Faculty Exchange Programs in FY 2004.

Using FY 2004 funds by invoking notwithstanding authority, the USG is helping the Uzbek Government to reform, modernize and streamline its healthcare system so that it can serve the country's growing population more effectively and efficiently. Health-care reforms in pilot areas have already benefited more than five million citizens and have allowed clinics to address their own priority needs and make their own decisions. The Uzbek Government has recognized the value of these changes and has decided to apply nationwide the reforms developed in the pilot program. The Uzbek Government is pressing ahead with the national expansion of rural primary health-care reforms and is making strides in tuberculosis (TB) control. Primary health-care facilities now reach roughly twenty percent (5.16 million) of the population. The reform models will be expanded in urban areas and in central district hospitals. In FY 2004, the USG expanded its programs to address Uzbekistan's HIV/AIDS challenge. Also employing FY 2004 funding and notwithstanding authority, the USG's ongoing drug demand reduction activity helped the Uzbek Government and NGO community expand their service coverage, targeting high-risk groups in particular. Similarly, the USG is helping the Uzbek Government implement a $24.5 million grant for HIV control from the Global Fund to Fight AIDS, Tuberculosis and Malaria (GFATM) through a new HIV/AIDS prevention activity. In addition, work through the U.S. Centers for Disease Control and Prevention laid the foundation for implementation of Uzbekistan's HIV/AIDS surveillance system, as well as began to improve the safety of the country's blood supply. The USG will also help implement a $13.8 million grant for TB and $2.5 million grant for malaria control, both from the GFATM. The USG's maternal and child health program achieved notable success in assisting the Government pass a new regulation on infection prevention in health care facilities.

In February 2004, the GOU issued the National State Program of School Education Development for 2004-2009, an ambitious plan of quality improvement in basic education. While the main focus of the program is reconstruction of schools, it also envisages substantial improvement of the entire system of school education, including the development of resource base and educational standards, creation of equitable conditions for primary education across the country, and increase of teacher pay. The new Minister of Public Education (MPE) has initiated structural changes within the MPE to maximize its effectiveness in responding to the challenges of the new State program. Both the Minister and the new MPE staff have demonstrated support for USAID initiatives in basic education. Unfortunately, drastic changes in regulations for NGOs have had a negative impact on the implementation of USG efforts in basic education reform. The Open Society Institute (OSI), a key sub-grantee under the program responsible for the teacher-training component, was denied renewal of registration, which had a significant negative effect on education improvement programs. In addition, pilot schools experienced considerable difficulties in receiving USG grant funding due to restrictions introduced by the Uzbek Government.

During 2004, USAID invested in training and capacity building at nine Professional Development Schools, which were identified across the country as having the potential to disseminate modern interactive teaching methods and management practices to surrounding schools. By September 2004, 58 cluster schools were identified and additional selection was underway. As of September 2004, USAID estimates that the number of children benefiting from the program was 59,546, of which fifty-one percent are female.

USG-supported trainings on new instructional methods aimed at developing critical thinking reached 517 primary and secondary teachers of pilot schools in FY 2004. Building strong partnerships among schools, parents, and local communities is a key factor in improving educational quality. In collaboration with neighboring communities, the USG facilitated establishment of 21 Community Education Committees and 16 children's clubs at 21 schools. These new school-community groups have been tasked to address, through joint activities and mutual responsibility, the problems of non-attendance and the deterioration of the quality of education.

The poor condition of school infrastructure in most rural areas is a major factor contributing to low attendance during the cold winter months. To address the need for school infrastructure repair, the USG provided small grants for reconstruction projects to 18 schools in three regions.

In FY 2004, the School Connectivity Program for Uzbekistan established 60 Internet centers at schools in six regions throughout Uzbekistan and trained over 23,000 students and teachers in computer literacy. The ten most active and effective teachers participated in a three-week professional development program in the U.S. The School Connectivity Web portal is the number one electronic resource for primary and secondary education in Uzbekistan. The Regional English Language Officer (RELO) spent $213,000 to buy books, equipment, and training for teachers at the Institute of English Language Teacher Education (IELTE), Uzbekistan's most promising institution of higher education focusing on English language teaching and curriculum.

National Science Foundation/Civilian Research and Development Foundation (NSF/CRDF) support projects range from basic research to those that help market applied research to the private sector, thus supporting free-market economic principles. In FY 2004, these projects included two-year joint research projects involving U.S. and Uzbek researchers, a grant to purchase new equipment for the Scientific and Technology Center of Structure Imaging, travel grants for Uzbek scientists to meet with U.S. industry representatives, and three grants to support new business collaborations between U.S. for-profit companies and Uzbek researchers.

In FY 2004, the Peace Corps funded projects for volunteers and their counterpart organizations in cities and villages that directly support USG strategic interests in the fields of democracy development and enrichment of the social sector. The projects included English camps, boys and girls leadership camps, media centers, resource centers, English language resource centers, infrastructure development projects including remodeling of clinics, schools and a new road, and teacher training for local English teachers.

In FY 2004, nearly $17 million in humanitarian commodities were provided to the most vulnerable population groups throughout Uzbekistan through the DOS humanitarian assistance programs. These commodities were distributed and monitored by U.S. Private Volunteer Organizations, along with their local partners, through DOS grants. Essential humanitarian commodities included medicines, medical supplies and equipment, food, clothing, and emergency shelter items. Total FSA funding utilized to support this program was $0.64 million.

Security, Regional Stability, and Law Enforcement

Using remaining prior year funds, USG security-related assistance was focused on supporting efforts to improve the Government of Uzbekistan's counter proliferation capabilities, continued fostering of regional cooperation, and improving border security via the portal monitoring program in order to reduce traffic of illegal narcotics and other hazardous, illicit items across Uzbek borders in FY 2004. The USG provided training, along with various types of detection equipment and security-related equipment to the Uzbek military to ensure inter-operability and communications clarity between Uzbek agencies in the event of suspect material being located at one of the border crossings.

Uzbekistan agreed to eliminate its weapons-grade nuclear material following the collapse of the Soviet Union, but is still dealing with the legacy of its past: remnants of biological and chemical WMD and their delivery systems, as well as the potential proliferation of WMD expertise. This assistance also allowed continued interoperability and strengthening of counter-terrorism capabilities between USG and Uzbek agencies. In 2004, the USG conducted numerous policy, assessment, and training events, including Radiological Detection and Response, WMD Crime Scene Skills Recertification training, and WMD Investigative Analysis training. Equipment provided for these training events includes: radiation pagers, intrusion detection devices, chemical and radiation detection and measurement devices, individual protective gear, decontamination equipment, and evidence collection kits. In connection with the Biological Weapons Proliferation Program (BWPP), the USG has provided numerous pieces of equipment to various institutes in Tashkent and Samarkand to include incinerators, generators, bio-safety vent hoods and numerous other expendable items to assist in the safe and secure research of hazardous diseases. The Central Reference Laboratory (CRL) project is the crown jewel of the BWPP program and will be connected to 13 separate epidemiological monitoring stations (EMS) to assist in disease control and research. The end goal in constructing the CRL is the safe storage of, and work with, extremely infectious diseases, and eventually the transfer of all strains maintained in the CRL laboratory to the Center for Disease Control (CDC). The program will be in place for a total of six years, with four years devoted to the construction of the new laboratories and storage facility and two years of follow up maintenance. Thanks to numerous surveys and engineering assessments, the locations for the EMSs have been established and work will commence on their construction/renovation in the near future. In summer 2004, USDOE provided financial and logistical support to the GOU to ship 11 kilograms of highly enriched uranium to Russia to be converted to LEU (low-enriched uranium). This project is part of ongoing cooperation with the GOU in reducing the likelihood of proliferating WMD.

Assessments and border visits conducted under the Export Control and Related Border Security (EXBS) Assistance Program have confirmed that EXBS equipment provided in prior years is being widely distributed by Uzbek officials and has played a key role in many recent interdictions of illicit materials. Using prior year funds, EXBS-provided equipment, engines and materials for refitting marine craft have allowed the Uzbek Maritime Service to redeploy 29 patrol vessels on the Amu Darya River. USG-funded training is also having a positive impact and is significantly changing the way Uzbek border security officials perform their duties. Under the Department of Homeland Security, 40 Customs and Border Guard Officers received training on border interdiction and radiation safety in Hidalgo, Texas. The recent passage of the law "On Export Control" shows commitment by the Government of Uzbekistan to observe their international obligations for the control of the proliferation of WMD weapons and materials. EXBS and the Department of Commerce have provided training programs on munitions and dual-use materials covered under Uzbekistan's export control laws. In addition, the Uzbek Government has indicated its willingness to sign a regional transit agreement.

Using FY 2002 funds, the USG is providing patrol boats to the Uzbek Government to patrol the Amu Darya River. The first of two Gyurza-Riverine Armored Patrol Boats, totaling $5.6 million, arrived in Termez in October 2004. The United States Department of Homeland Security (DHS), acting as the Executive Agent for the Department of State, is providing this assistance to the Republic of Uzbekistan under the Aviation/Interdiction Program (AIP). The Committee for State Border Protection (KOGG) maritime units provides support for all riverine missions, including nonproliferation and combating drug trafficking missions. Helping the Uzbek Committee for State Border Protection maintain and enhance their patrol capabilities is critical to U.S. national security priorities in the region.

In FY 2004, the USG continued to conduct exchange programs on U.S. foreign policy, border control issues, NATO, and the proper conduct of criminal investigations. Eight Uzbek journalists and prominent academics, sponsored by the U.S. Embassy and USNATO, visited NATO Headquarters in Brussels to learn about the role of NATO and Uzbekistan's participation in the Partnership for Peace. Following the visit, the participating Uzbek journalists wrote a series of articles about NATO and what they learned during their visit, improving Uzbek public understanding of the important coordination between Uzbekistan and NATO.

In FY 2004, the Government of Uzbekistan was not eligible for Foreign Military Financing (FMF) and International Military Education and Training (IMET) funding due to the Secretary of State's determination under the FY 2004 Foreign Assistance Act. $300,000 in prior-year Department of Defense Counter-Terrorism funds were used to send two Uzbek military officers to military professional development training courses, part of a program which is a cornerstone of the Uzbek government's military transformation efforts. To strengthen border security and combat narcotics smuggling, $500,000 in counter-narcotics funding was allocated to conduct a patrol boat command and control technology demonstration with the Uzbek Border Guard riverine forces. The Border Guards practiced using this new technology to detect, deter, prevent, and interdict illicit trafficking of substances along the Amu Darya River.

A total of 42 Uzbek defense and security specialists participated in a wide range of resident and non-resident professional development courses and seminars at the U.S. Defense Department's George C. Marshall Center in Germany, including conferences on topics such as cyber security, and economic dimensions of defense institution building. Many graduates of these programs are now holding positions of increased responsibility in the Uzbek Government, including the Deputy Minister of Defense for International Cooperation, the Commander of the Tashkent Military District, and Deputy Chief of Mission at the Uzbek Embassy in Washington.

The Uzbek Ministry of Defense was an active participant in a military-to-military cooperation program that provided support to the Ministry's reform initiatives and increased its counter-terrorism capabilities. Cooperative Threat Reduction funds supported the participation of some 103 Uzbek military officers and non-commissioned officers in a variety of subject matter expert exchanges and training exercises in the United States. Funding from the USG Iraqi Freedom Fund provided specific counter-terrorism training and equipment to more than 300 Uzbek special operation service members. Under the Partnership for Peace Program (PfP), USG Warsaw Initiative Funds supported the participation of over 111 Uzbek service members in a variety of exercises, seminars, and other PfP events.

In FY 2004, the Department of State's Diplomatic Security Service held several courses in conjunction with the Anti-Terrorist Assistance (ATA) program, including the ILEA Budapest course on the "Role of Police in Combating Terrorism," where Uzbeks took part alongside Kyrgyz, Tajik, and Kazakh counterparts; "Crisis Response Team; "Bomb Technician Exchange;" "Protective Operations Management;" and "Consultation-Protective Operations Management," a regional event with participation of Kazakh, Tajik, and Kyrgyz counterparts.

Although Uzbekistan has started to reform its criminal justice system in recent years, the system's institutional infrastructure is still dominated by the mentality of its Soviet predecessor and continues to suffer from low salaries, insufficient training and equipment, and widespread corruption. Nevertheless, the GOU has taken some meaningful steps toward reform. The Supreme Court issued two important decrees in FY 2004 to remedy certain deficiencies in its criminal procedure. In the first, the Court clarified that the right to defense counsel begins at the moment of detention. The second issued an explicit ban on the admissibility of evidence gained by torture of other illegal means. Using FY 2004 funds provided under notwithstanding authority, the U.S. Department of Justice, through its Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT) has been working closely with the Uzbek Parliament, and other GOU officials to develop an anti-money laundering law and a regulatory framework that meets international standards, and to institute other basic changes to bring Uzbek's criminal procedure code into compliance with its obligations under international treaties to which it is a party. OPDAT, in partnership with ABA/CEELI, held a joint workshop for prosecutors and defense attorneys, which emphasized basic standards for fair trials under the International Covenant on Civil and Political Rights. In FY 2004, the USG funded the installation of a computer network to link all the central and regional offices of the Procuracy. The project also requires the Procuracy to maintain a Web site to provide greater public access to laws and other information of general interest.

Another criminal reform project is the OSCE prison reform project. Using prior year funds, the USG funded a multi-phase project, implemented by the OSCE, to improve the Uzbek prison system. Three components underway in 2004 include monitoring prisons through site visits and interviews, training a cadre of prison officials to teach their colleagues about international standards applicable in prisons, and developing a curriculum and academy for prison officials. Also in 2004, the Uzbeks signed an agreement to participate in a Bilateral Exchange Project, designed to improve Uzbekistan's legal and judicial systems through exposure to the U.S. legal system and international norms. It will also help the Uzbeks in implementing their National Plan of Action in response to the recommendations of the UN's Special Rapporteur on Torture, with the overall goal of eliminating reliance on torture as an investigative technique. This project provides technical assistance and training, including study trips to the U.S., for Uzbek judges, prosecutors, law enforcement officers and Ministry of Justice officials.

The U.S. Drug Enforcement Administration (DEA) and the Uzbek Ministry of Internal Affairs (MVD) have jointly established a counter-narcotic Sensitive Investigative Unit (SIU), which became operational in FY 2003 and was successfully continued in FY 2004. The DEA and the Uzbek Government worked with other Central Asian law enforcement agencies to promote regional coordination on counter-narcotics efforts. The DEA-sponsored SIU has conducted a number of counter-narcotics operations resulting in total seizures to date exceeding 200 kilograms of heroin and over 100 arrests. The Uzbek Government has also been actively sharing regional intelligence on narcotics.

COUNTRY PERFORMANCE MEASURES

In FY 2004, Uzbekistan's human rights record remained poor. While the Government took some important steps to address torture and to establish police accountability, it made no progress on democratic reform and placed further restrictions on the activities of nongovernmental organizations and the press. Likewise in FY 2004, the Government of Uzbekistan continued to enact policies driving the country further away from a market economy. Uzbek Government economic policies and reluctance to implement true market reforms have created a difficult environment for all local and foreign businesses.

Economic & Democratic Reforms, 1991-2004

Economic and Democratic Reforms, 1991-2004, for Uzbekistan

Data are drawn from EBRD, Transition Report (November 2004) & Freedom House, Nations in Transit 2004 & Freedom in the World 2004. Ratings are based on a 1 to 5 scale with 5 representing the most advanced.

Latest-year observation refers to 2004 economic reform data and 2003 democratic reform data; i.e., 2004 data for democratic reforms are not yet available.

Little progress has been made in broadening and deepening the private sector in Uzbekistan, as privatization of state-owned enterprises has been slow and the environment for foreign investment remains difficult. The enforcement of a decree mandating registration of all traders and enforcing strict import requirements caused civil unrest in some regional bazaars. Arbitrary excise taxes and customs fees remain dramatically high, dampening the prospect for imports even for large legal businesses and officially registered small and medium enterprises (SMEs). Despite the Government's recent attempt to modernize its health care system, quality of life is still poor for the majority of the population.

Economic Structure and Human Development, 1990-2004

 Economic Structure and Human Development, 1990-2004, for Uzbekistan

World Bank, World Development Indicators 2004 (2004); UNICEF, Social Monitor 2004 (2004); EBRD, Transition Report (November 2004); and UNDP, Human Development Report (2004).

SECTORAL PERFORMANCE MEASURES

DEMOCRATIC REFORM

Performance Indicator: Independent Media rating, Drawing from Freedom House, Nations in Transit 2004 as modified by, "Monitoring Country Progress in Eastern Europe and Eurasia" USAID/E&E/PO, #9 January 6, 2005. (1-lowest, 5-highest; data based on previous calendar year)

FY 2002 Baseline

FY 2003 Actual

FY 2004 Target

FY 2004 Actual

1.17

1.17

1.17

1.17

FY 2004 saw no improvement in press freedom and the continued existence of widespread self-censorship among all media. The greatest progress could be seen in radio news broadcasts that have been the most successful in broaching quasi-political issues and have faced minimal monitoring by the government. The President's administration has continued to pressure those few independent media outlets that exist in the country to broadcast and publish the information that serves the interests of the central government. The numbers of lawsuits against outspoken journalists have not decreased from the previous years. One independent television station had its license suspended and remains off the air; three other independent television stations had their licenses temporarily suspended.

Performance Indicator: USAID NGO Sustainability Index (1 = highest; 7 = lowest)

FY 2002 Baseline

FY 2003 Actual

FY 2004 Target

FY 2004 Actual

4.7

4.7

4.7

5.3*

(*This is not the final, official NGOSI score, but rather a performance measure tracked solely by the missions.)

FY 2004 Results: The overall rating declined dramatically in 2004, due to changes in legislation introduced by the Government in the area of grants transfers, international NGO registration, and mandatory re-registration of women's NGOs. Deterioration in the economic situation and frustrations with the slow pace of democratic reforms also account for the dramatic decline in the indicator. Thanks in large part to these new regulations; some USG-funded NGO programs came to a complete standstill, while others had to postpone critical equipment transfers and civil society training programs.

ECONOMIC AND SOCIAL REFORM PROGRAMS

Performance Indicator: Incidence of Tuberculosis (new cases per 100,000) Source: UNICEF. This indicator has an 18-month lag time; therefore, FY 2003 and FY 2004 actual data is not yet available.

FY 2002 Baseline

FY 2003 Actual

FY 2004 Target

FY 2004 Actual

79.4

N/A

N/A

N/A

FY 2004 results: USG assistance began with the first patients enrolled in DOTS in January 2000, in five initial pilot sites (Ferghana Rayon, Syrdarya Rayon, Urgut Rayon, Akmal Ikramov Rayonand Chilanzar Rayon). In January 2002, USAID included three more cities (Andizhan, Namangan and Ferghana); in January 2004, following USG assistance with an application to the Global Drug Facility for free TB medication, the USG began DOTS treatment for TB patients in Samarkand and Yangier cities. In the pilot sites, the TB case notification rate has increased by twelve percent, from 64.6 TB cases per 100,000 people in 2000, to 73.5 cases per 100,000 people in 2003. The treatment success rate was seventy-three percent in 2003 in the pilot sites. The TB mortality rate in the country has decreased, from 12.3 per 100,000 in 2002, to 11.5 per 100,000 in 2003. Rising case notification rates indicates the impact of USG assistance, as clinicians become better able to identify and diagnose cases. The treatment success rate and reduction in mortality can be attributed to improved availability of drugs and proper implementation of DOTS, both also demonstrative of the impact of technical assistance.

SECURITY, REGIONAL STABILITY AND LAW ENFORCEMENT

Performance Indicator: State Department Global Trafficking in Persons Report

FY 2002 Baseline

FY 2003 Actual

FY 2004 Target

FY 2004 Actual

Not ranked

Tier 3

Tier 2

Tier 2

In FY 2004, the GOU, with USG assistance made significant progress in combating trafficking in persons. Working together, the U.S. and Uzbek Governments and the local Uzbek NGOs have continued running innovative public education campaigns on prevention and prosecution of trafficking throughout the country. Uzbek law enforcement demonstrated a strong commitment to curbing trafficking by establishing special internal units, including new units in both the Ministry of Internal Affairs (MVD) and the National Security Service to handle human trafficking cases. Such interagency cooperation is vital to sustained success in curbing human trafficking. The Uzbek Government has made significant progress in combating trafficking in persons, including the development of a national action plan. This progress was reflected in the fact that Uzbekistan stayed in Tier II in the State Department's Global Trafficking in Persons report rankings during 2004.

Performance Indicator: Non-proliferation actions taken

FY 2002 Baseline

FY 2004 Target

FY 2004 Actual

Nukus cleanup complete. Vozrozhdeniye Island biological weapons cleanup launched and completed. Institute of Nuclear Physics project completed.

The goal for FY 2004 was two-fold; to develop a comprehensive plan for construction of a Central Reference Laboratory (CRL) to enable joint work with and storage of especially dangerous pathogens as well as a strain museum for all Uzbek bio materials. Also, the construction of epidemiological monitoring stations (EMS) throughout the country to assist in identification and classification of possibly dangerous pathogens. Secondly, continued development of the Portal Monitoring program, to include designation of future sites for upgrade and installation of equipment.

Successful transfer of HEU to Russia for conversion into LEU, and successful equipment transfers providing security for those working in non-proliferation.

FY 2004 Results: Although measurement of progress with metrics is not possible at this time, great strides have been made in FY 2004 in relation to non-proliferation issues. All of the USG cooperative threat programs are coming to fruition and the long months of tedious negotiation will reap great rewards. The numerous system and equipment upgrades completed during this fiscal year will allow for continued rapid developments in the area of non-proliferation, and that will in turn ensure a safer Uzbekistan as well as neighboring governments.

FY 2004 FUNDS BUDGETED FOR U.S. GOVERNMENT ASSISTANCE TO
UZBEKISTAN

TOTAL USG FUNDS BUDGETED:
$85.44 m
VALUE OF DONATED HUMANITARIAN COMMODITIES $16.41 m

TOTAL FY 2004 USG ASSISTANCE:
$101.85 m
FSA Total:$35.89 m

Agency for Internat'l. Dev. (USAID)
   Democratic Reform $9.23
   Environmental Management $3.48
   Private Sector Initiatives $6.41
   Social Sector Reform $7.61
   Special/Cross-Cutting Initiatives $1.03
   x Community Exchanges $1.10
   x Eurasia Foundation $1.00
   x Parking Fine Withholding $0.01

Total USAID: $29.88


Dept. of State
   EUR Democracy Programs (incl. Dem. Comms. & NED) $0.85
   Humanitarian Transport $2.00
   International Information Programs (IIP) $0.05
   Law Enforcement Assistance $2.00

Total State: $4.90


Dept. of Agriculture (USDA)
   Cochran Fellowship Program $0.15
   Faculty Exchange Program $0.13

Total USDA: $0.28


Dept. of Commerce
   Business Info. Service for the NIS (BISNIS) $0.10
   Special American Business Internship Training (SABIT) $0.13

Total Commerce: $0.23


National Science Foundation
   Civilian R&D Foundation (CRDF) $0.60

non-FSA Total:$49.55 m

Agency for Internat'l. Dev. (USAID)
   Child Survival & Health Programs $1.00

Dept. of State
   Anti-Terrorism Assistance (ATA) $3.10
   Human Rights & Democracy Fund (HRDF) $1.93
   International Information Programs (IIP) $0.03
   International Military Educ. & Training (IMET) $0.48
   Nonproliferation of WMD Expertise $2.12
   Public Diplomacy Exchanges $3.88

Total State: $11.53


Dept. of Agriculture (USDA)
   Government-to-Government Food Aid $3.23
   Nonproliferation of WMD Expertise $1.48

Total USDA: $4.71


Dept. of Defense
   Destruction and Dismantlement Programs $20.14
   Humanitarian Assistance $0.15
   International Counterproliferation Programs $0.85
   Warsaw Initiative $2.54

Total DoD: $23.69


Dept. of Education
   Fulbright-Hays Programs $0.05

Dept. of Energy
   Material Protection, Control & Accounting (MPC&A) $0.30
   Nonproliferation & International Security Programs $4.77
   Nuclear Reactor Safety $0.60

Total DoEnergy: $5.67


Dept. of Labor
   International Child Labor Program $0.44

National Science Foundation
   Civilian R&D Foundation (CRDF) $0.03

Open World Leadership Center
   Open World Program $0.35

Peace Corps
   Volunteers / General Operations $2.07

Trade & Development Agency (USTDA)
   Feasibility Studies / Trade Promotion $0.02