Uzbekistan is arguably best known for its dazzling ancient cities that are dotted along the Silk Road, the legendary trade route between China and the Mediterranean, and its great mountains and deserts.
But what may surprise many about this landlocked Central Asian country is that it is increasingly becoming known for its forward-thinking, proactive and positive approach to fintech (financial technology) and globalization.
A case in point: Last week, the Uzbek government confirmed that it would implement a series of initiatives to boost the expanding cryptocurrency industry.
Specifically, it is legalizing cryptocurrency exchanges and will permit firms specializing in blockchain, the technology that underpins the likes of Bitcoin, to establish offices in the state. This comes after a presidential decree that was rolled out to promote the use of cryptocurrencies and blockchain in Uzbekistan.
A government paper titled “On Measures to Organize the Activities of Crypto-exchanges in Uzbekistan” identifies a raft of official guidelines – including that cryptocurrencies will not be treated like securities and therefore the crypto exchanges will not have the same regulatory framework. Instead, crypto firms will have a new and specific set of regulations, known as special normative acts.
The document also underscores that any revenue derived in cryptocurrency will not be taxable.
Uzbekistan is also collaborating with crypto specialists and agencies in South Korea, a country that is truly crypto-crazy, to help it advance the sector. Indeed, it is estimated that between 30% and 50% of South Koreans are invested in the likes of Bitcoin, Ethereum and XRP.
The Central Asian nation has also been developing “Uzbekistan Revolution 4.0,” a state-funded program that is designed to integrate the blockchain and cryptocurrency industries within Uzbekistan’s economic development model.
This future-focused approach extends to the country’s apparent view toward globalization. While other nations, especially in the West, seem to be intent on putting up barriers to free international trade, Uzbekistan is opening its doors to the outside world.
And it is reaping benefits in this regard. For instance, Uzbek President Shavkat Mirziyoyev won US$6.5 billion in US contracts during his Oval Office meeting with President Donald Trump in May.
As I wrote in 2016 for Asia Times, “for all the protectionist grandstanding by some Western politicians, globalization in the world of trade and commerce is here to stay and will, if anything, only gain momentum.”
I’m confident this remains the case as the world becomes ever more digitized, interdependent and globalized.
And, as such, I’m equally confident that the proactive policies being taken on fintech and globalization today will position Uzbekistan light-years ahead on the world stage tomorrow.