The impact of foreign investment and tax-based governance on the economy of Uzbekistan

Economic Annals-XXI: Volume 213, Issue (1-2), Pages: 65-70

Citation information
Berdiyarov, B., Ahrorov, Z., Tuychiev, Sh., Khodjimamedov, A., Chuponov, S., & Yoqubov, D. (2025). The impact of foreign investment and tax-based governance on the economy of Uzbekistan. Economic Annals-XXI, 213(1-2), 65-70. doi: https://doi.org/10.21003/ea.V213-06

Bakhriddin Berdiyarov
D.Sc. (Economics),
Professor,
National University of Uzbekistan named after Mirzo Ulugbek
4 Universitet Str., Vuzgorodok, Tashkent, 100174, Uzbekistan
bahriddin.bfa@gmail.com
ORCID ID: https://orcid.org/0000-0001-8591-6840

Zarif Ahrorov
D.Sc. (Finances),
Associate Professor,
Samarkand Branch,
Tashkent State University of Economics
51 Professorlar Str., Samarkand, 140100, Uzbekistan
zarif_akhrorov@sbtsue.uz
ORCID ID: https://orcid.org/0000-0003-4403-9137

Sherkhon Tuychiev
PhD (Finances),
Senior Lecturer,
Samarkand Branch,
Tashkent State University of Economics
51 Professorlar Str., Samarkand, 140100, Uzbekistan
sherkhontuychiev@gmail.com
ORCID ID: https://orcid.org/0009-0000-3596-5820

Akmal Khodjimamedov
PhD (Finances),
Associate Professor,
Samarkand Institute of Economics and Service
9 Amir Temur ko’chasi, Samarkand, 140100, Uzbekistan
989iranec@gmail.com
ORCID ID: https://orcid.org/0000-0002-0876-6671

Sanat Chuponov
MA (Education),
Senior Lecturer,
Department of Business Administration,
Mamun University
989Q+6V, 2 Bolkhovuz Str., Khiva, Khorezm region, 220900, Uzbekistan
chuponov_sanat@mamunedu.uz
ORCID ID: https://orcid.org/0000-0001-7388-9224

Diyorbek Yoqubov
PhD researcher (Agriculture),
Department of Fruits and Vegetables,
Urgench State University
14 Kh. Alimdjan Str., Urganch, Khorezm, 220100, Uzbekistan
ykbvdiyor1@gmail.com
ORCID ID: https://orcid.org/0009-0006-2829-5922

The impact of foreign investment and tax-based governance on the economy of Uzbekistan

Abstract. Today, no country can achieve proper growth and development without active participation in international trade and the global economy. Many developing countries, faced with the need to upgrade and strengthen the economy in the long term to access new technologies, have faced the challenge of managing technical knowledge, which in most cases is significantly associated with a lack of resources. Strengthening the local economy in a situation of resource scarcity is associated with the potential role of foreign direct investment in relation to the long-term growth and development of the economy in these countries. Therefore, in this study, using panel data for the years 2022-2024 of Uzbekistan, a model has been presented to examine the impact of taxes and attracting foreign direct investment on the economy using the panel data method. The variables used included: gross domestic product, taxes, foreign direct investment inflows and government performance.

The results showed that the tax variable has a negative effect on attracting foreign direct investment, and the variables of gross domestic product, government performance and growth in attracting foreign capital have a positive effect on direct performance. It should be noted that the reduction in taxes on foreign capital and as an incentive from the government to attract capital is effective and can lead to higher growth in attracting investment, and in other economic sectors, the amount of tax revenue should be managed by the government.

Keywords: Foreign Direct Investment; GDP; Taxes; Panel Data; Government Performance; Investment Flow

JEL Classifications: Е24; Е41; Е64; I18; J28; J31

Acknowledgements and Funding: The authors received no direct funding for this research.

Contribution: The authors contributed equally to this work.

Data Availability Statement: The dataset is available from the authors upon request.

DOI: https://doi.org/10.21003/ea.V213-06

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Received 25.10.2024
Received in revised form 19.11.2024
Accepted 23.11.2024
Available online 26.02.2025