On May 1-4, 2010, the 43rd annual meeting of the Asian Development Bank’s (ADB) board of governors took place in Tashkent, Uzbekistan. More than three thousand participants attended the meeting, including heads of government, chairmen of central banks, ministers of finance, representatives of business and science, and journalists. Tashkent was satisfied with the outcomes of the meeting in general, as they signed four credit contracts of over US$ 1.15 billion. In addition to a substantial financial package and in spite of certain controversies with the human rights situation in the country, the ADB authorities showed that they are interested in the stability of Uzbekistan, assuming that this is an essential condition for stability in the whole region.

The ADB is one of the major donors to Uzbekistan’s economy, and holds the primary place among all the international financial institutions on investment cooperation with Uzbekistan. Uzbekistan started to cooperate with the ADB in 1995. With credit resources of US$ 1.2 billion provided to the country from 1996, eleven projects have already been implemented and fifteen more are currently under implementation. The ADB has mainly financed projects in the spheres of education, agriculture, modernization of transport infrastructure and the energy sector.

As it was the first time in the ADB’s history that the board of governors convened in a Central Asian republic, many observers were puzzled by the bank’s decision. The President of the ADB, Mr. Haruhiko Kuroda, however, emphasized that the bank is not a political organization, and the venue for its meeting was chosen on the basis of availability of sufficient infrastructure for the reception of large delegations. In addition, Mr. Kuroda noted the good shape of the Uzbek economy, underlining that Uzbekistan had suffered less from the world crisis than many other states and that the Uzbek authorities took timely measures for expanding investments in economic development, improving financial and tax policies, economic diversification, and for supporting industry, infrastructure and the internal market, as well as the social sphere. As a result of this, Mr. Kuroda believes, Uzbekistan was able to keep its economic growth, which in 2009 amounted to 8.1 percent of GDP.

Some local observers report, however, that Tashkent took several measures to create an image of positive economic development. For instance, it fudged statistics suddenly by reducing interest rates on deposits by over 50 percent. An absolute deficit of cash was created in order to demonstrate positive inflation rates, implying that the majority of state employees now receive their salaries on plastic cards, from which it is virtually impossible to withdraw any money. Furthermore, some sources report that on the eve of the ADB meeting the Uzbek authorities “pressed” the shadow markets for currency to lower the unofficial rate of the Sum.

Another controversial issue on the eve of the big summit concerned human rights activists. On April 28, a non-governmental organization called “ADB Forum” – a network of 250 civil society organizations that monitors the bank’s activities from 1992 – boycotted the ADB meeting in Tashkent. As the NGO’s executive director Dr. Avilash Roule stated:”the decision of the ADB to hold its annual meeting in Tashkent is not only non-transparent, but also approves the pressure on human rights and freedom of expression carried out by the Uzbek authorities”. Neither the ADB, nor Uzbek authorities reacted to such statements. The boycott was cancelled as representatives of civil society simply were not invited to the event. In fact, it would be impossible to hold any boycotts as Tashkent became a closed city during the days of the meeting.

It should be noted that as a financial institution, the ADB does not address human rights issues as its primary concern. In relation to this, Mr. Kuroda mentioned that “improvement of the human rights situation in Asia can be achieved by fighting poverty and enhancing livelihoods”.

All in all, the meeting was a success both for the ADB and for Uzbekistan. As some experts say, in spite of all the controversies the ADB needs Tashkent to promote its power transmission lines, railroad and other infrastructural projects in the whole region. Tashkent, in turn, greatly benefits from investments of the bank for the development of its own infrastructure and banking system.