Tortuous Trajectory

Head of Kursiv Research
Sevenfold growth

Despite being richer with architectural heritage and natural monuments than other Central Asian states (the vast majority of historical monuments are inside big Uzbek cities or near to them), for a long time Uzbekistan couldn’t make any progress in the development of its internal tourism. 
However, after the political reforms of 2016-2017, the number of foreign tourists had been steadily increasing: from two million in 2016 to 6.7 million in 2019. If compared with 2010 figures, the growth was sevenfold (592%) which is one of the most impressive results all over the world. 
According to the World Bank, over the period from 2016 to 2019, Uzbekistan increased the share of tourism in its gross exports from 5.5% to 9.9%. Even though the main source of foreign currency for the country (as well as for neighboring Kazakhstan) is still the export of natural resources, tourism plays a bigger role these days. 
In 2019 Central Asian countries accounted for the vast majority of foreign tourists in the country: Kazakhstan (33.5%), Tajikistan (21.8%), Kyrgyzstan (21.6%), and Turkmenistan (8.5%). Fewer tourists arrived from Russia (6.7%), Turkey (0.9%), China (0.8%), Japan and Germany (0.4% each). In general, about 488,000 or 7.2% out of all foreign tourists came from outside of the CIS.

The type of transportation that tourists prefer to use depends on the geography. According to UNWTO, roughly 90% of all tourists use cars, 1% trains and 9% air transportation.  

Year of Restrictions

Last year should have to be a record-breaking year for the entire Uzbekistani tourism industry. However, the pandemic changed everything.
Uzbekistan was forced to do exactly what all other Central Asian countries did: to declare a lockdown in the middle of the tourist season from March to August. People were not allowed to move from one region to another and all public events were canceled. The public food industry and hotels were also told to stop working. 

To support the internal tourism industry, the Uzbek government has started to differentiate its regions by colors which reflect the rate of COVID-19 risk. For example, for regions labeled with green and yellow, tour operators were allowed to work if they comply with sanitary rules. 
Moreover, the government has been implementing some other supportive measures. For example, tour companies were paid $15 for each tourist who decided to stay in the country for more than five days. Last year tour operators could also rely on transportation subsidies: about 30% for air and train tickets for groups of foreign tourists (not less than 10 people). Subsidies for renovation work in hotels are still available until the end of this June. 
There were no restrictions for tourists from countries in the green zone (South Korea, Japan, China and Israel). Tourists from the yellow zone (EU member states, Malaysia, Thailand and Singapore) as well as from the red zone (Turkey, Russia, Kazakhstan and other CIS countries) were able to visit Uzbekistan after a fourteen-day quarantine. 

As a result of these restrictive measures by the government and extremely low tourist activity, the tourism industry in Uzbekistan dropped fourfold.

Tough Times for Tourism

According to the UNWTO report (January 2021) about last year, world tourism faced the most severe crisis in modern history. The number of guests who had traveled abroad and stayed in hotels plunged by 74% all over the world. As a result, the industry lost about $1.3 trillion, which is 11 times higher than in 2009, when tourism had suffered from the financial crisis. 
Given the global scale of the sanitary measures, tourism struggles everywhere. And of course, tourism losses in different regions directly depended on the scale and intensity of restrictive measures in a particular country. For example, Asia and the Pacific region lost 84% of foreign guests, the Middle East and Africa – 75%, Europe – 70%, and North and South Americas about 69%, according to UNWTO. However, in terms of absolute figures, these losses were not the same: while Asia lost 300 million tourists, the losses for Europe were about 500 million.


In terms of the industry’s future, UNWTO experts give controversial forecasts. In a survey the organization conducted in January, 45% of experts said that the situation is going to improve. About 25% believe that nothing would change compared to 2020. And 30% of experts are expecting the industry will worsen. Half of the respondents said that the rebounding of tourism will occur in 2022, even though in another survey conducted in fall 2020 they expected the rebounding in 2021. However, the process to get tourism back to its pre-pandemic level (2019) may consume much more time: 43% of experts believe it might happen in 2023; 41% of others expect that in 2024 or even later on.
Because tourism in the open air is not banned, this sector may show growth, experts said. Also, the demand for internal tourism and tours to neighboring countries will surge. 
There is no evidence that Uzbekistan can return to the pre-crisis trajectory soon; it can take two years or four. However, given Europe and South Asia are still not ready to open their countries for tourists, Uzbekistan might be attractive for tourists from Russia and Kazakhstan. All three countries have relatively soft quarantine rules for those who enter or exit them. 
Thus, Uzbekistan is going to intensify transport communication with Kazakhstan. Currently, the two countries are working together on a high-speed railroad project, which is going to connect Turkestan, Shymkent and Tashkent. Uzbekistan has already built a high-speed railroad between Tashkent and Samarkand; therefore, once the project with Kazakhstan is ready the trans-border tourist cluster may appear. 
Soft sanitary conditions may also prove helpful in attracting more tourists from Europe or even from Turkey and the UAE. In March, Uzbekistan reached a deal on the creation of the air transport bubble with India and Seychelles.
Uzbekistan is going to expand its tourist infrastructure with HoReCa, new transport routes and foreign consulates in the most popular tourist areas. For example, in March the Turkish consulate was opened in Samarkand. Another consulate out there is going to open in Kazakhstan; the country’s president Kassym-Jomart Tokayev signed a relevant edict in September last year.

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