The Government of Uzbekistan in cooperation with the Asian Development Bank and the Islamic Corporation for the Development of Private Sector, a member of the Islamic Development Bank Group, hosted the Navoi Free Industrial and Economic Zone (FIEZ) Investment Forum on 21 - 23 October 2009 in Tashkent, Uzbekistan.

The Forum brought together a network of global investors to discover a range of unique investment opportunities in Uzbekistan. The Government invited partners in high-tech and export-oriented sectors to take advantage of the region's rich resources and unprecedented tax and customs privilages at the Navoi FIEZ.

Located on the ancient Great Silk Road, Uzbekistan has been historically a leading trade and cultural centre. Now the leading industrial country in Central Asia, its competitive advantage lies on its strategic location as a hub connecting Europe and Asia, along with large reserves of natural gas, precious metals, raw materials, and a well-educated workforce.

To improve the investment climate and attract more foreign direct investment, the Government has established the first ever free industrial and economic zone in Navoi, a leading industrial city at the center of Uzbekistan and the Central Asian region, within immediate vicinity of international transport communication routes.

Foreign companies planning to establish export-oriented production facilities in Navoi FIEZ will be provided with unprecedented privileges, including a de-facto tax-free, duty-free, and favorable currency regime, and simplified visa and employment procedures for 7-15 years, with possible extension of up to 30 years. To learn more about the investment and economic potential of Uzbekistan, including Navoi FIEZ,

please visit http://www.gov.uz and http://www.navoi.gov.uz.

Navoi Free Industrial Economic Zone (FIEZ)
The 546-hectare Navoi FIEZ, created by a presidential decree, lies in the Navoi region, about 100 kilometers (km) from the historical cities of Bukhara and Samarkand.

Special Legislative Regime in Navoi FIEZ: Investor Incentives

Special Tax Regime

Registered businesses are exempted from land tax, property, profit, social infrastructure development taxes, unified tax payment (for small businesses), and compulsory contributions to the Republican Road Fund and Republican School Fund from 7 to 15 years, depending on the amount of foreign direct investment (FDI). The table below shows the exemption period.

Special Customs Regime

Enterprises registered in the FIEZ are exempted from paying customs duties (excluding charges for customs clearance) for equipment, raw materials, and components imported for the production of export-oriented goods for the duration of their operations within the FIEZ.

Special Currency Regime

Enterprises registered in Navoi FIEZ are permitted to

• pay in foreign currency within the FIEZ under signed agreements and contracts,

• pay in freely convertible currency for the supply of goods and performance of services by Uzbekistan residents and business entities, and

• take advantage of available conditions and forms of payments for exported and imported goods.

Simplified Order of Entry, Departure, Stay, and Granting Permission for Externally Sourced Labor

Granting and extending validity periods for temporary residence permits in Uzbekistan,as well as permission for employing foreign workers and confirming work permits of Navoi FIEZ employees are without state fees.

Land on the FIEZ territory is available for lease to business entities for the whole period of their investment activity. This frees the investing company from purchasing land and enables them to use the money for additional production resources.

The Administration of the Navoi FIEZ

An administrative council coordinates and regulates activities in Navoi FIEZ. Formed in 27 January 2009 by a government resolution, the administrative council is a collegial body composed
of representatives of state boards that coordinate activities of the state organizations for the efficient operation of Navoi FIEZ.

The administrative board responsibilities include:

• Defining strategic directions for the medium- and long-term development of Navoi FIEZ,which envisions introducing modern high-efficiency equipment and technology, technological lines and units, innovative technologies for production of a wide range of high-tech and competitive products for the world market; and

• Selecting investors for allocation within Navoi FIEZ, as well as identifying the basic terms of investment agreements concluded with investors.

• The Directorate of Navoi FIEZ manages the operations of FIEZ, including providing services to its locators; facilitating registration, investments, and lease agreements; and monitoring the proper implementation of investor obligations.

The Navoi FIEZ lies near the International Airport, the E-40 highway, and international railroads. Navoi FIEZ is a multimodal transport and logistics hub that harnesses these facilities for maximum advantage.

Korean Air cargo airplane arrives at the Navoi airport	Construction of cargo terminal at the Navoi airport

Air Transportation

Flying through Uzbekistan offers substantial savings in time and cost of goods. The distance from Southeast Asia to Europe via Navoi is 1,000 km shorter than via Dubai. Thus, flying time is
reduced by approximately 1.5 hours and fuel saved is approximately 15 tons per aircraft. These strategic advantages led to KoreanAir's long-term agreement with the government.

Navoi airport is an international airport with modern equipment and infrastructure capable of receiving airplanes of all types, including cargo aircraft such as the Boeing 747 andAN124.

Three cargo flights are done every week through the Seoul (Incheon)-Navoi-Milan-Navoi-Seoul route (Korean Air), Tashkent-Navoi-Moscow-Navoi Tashkent route (Uzbekistan AirCompany), and Moscow-Navoi-Moscow route (Moskoviya Russian Air Company). Daily flights on theTashkent-Navoi-Tashkent route are made by Uzbekistan Air Company.

Since 27 May 2009, two cargo flights a week from Bangkok and Bombay land at Navoi International Airport. In the future, three flights a week will fly from Navoi to Moscow's Sheremetebo
International Airport.

Cargo flights to Bangkok, Brussels, Dubai, Moscow, and New Delhi also started their operations via Navoi International Airport in May 2009.

Land Transportation

The E-40 international highway passes through Navoi and is the shortest connection between Europe and Beijing. Land transportation on the PRC-Europeroute through Uzbekistan is shorter by about1,000 km, compared with the route through the PRC-Russian border. This reduces transportation costs by approximatelyUS$800 a vehicle. It takes 7 days for a container train to get from Tashkent to Bandar Abbas seaport and 10 days fromTashkent through Teheran to Istanbul. This is twice faster than bypassing Uzbekistan.

Rail Transportation

A rail line (close to the FIEZ) accesses the markets of Central Asia, Commonwealth of Independent States (CIS), Southeast Asia, Europe, Middle East, and the Persian Gulf.

Main railway routes pass through Navoi: to the south reaching the ports of Iran and Turkey, and to the west and north, to the Black and Baltic seas. The shortest railroad route from PRC to Europe also passes through Navoi. With the opening of the “Guzar-Baysun-Kumkurgan” railroad,Uzbekistan now has the shortest train connections to Afghanistan, India, and Pakistan.

KEY FACTORS FAVORING SUCCESSFUL IMPLEMENTATION OF PROJECTS IN NAVOI FIEZ

Factors contributing to the successful implementation of projects in Navoi FIEZ include the availability of infrastructure; reliable electric, gas, and water supply; access to labor force; and a favorable ecosystem necessary for a productive working environment and pleasant living conditions.

Rich Sources of Raw Materials

Navoi FIEZ has access to a wide range of raw materials. State-of the-art facilities are also available for investors to process these raw materials into competitive, export-oriented, and valued-added products. Uzbekistan generates 48 billion kilowatts of electricity and over 10 million kilocalories of heat energy a year.

Adequate Industrial Infrastructure

Navoi is an industrial city with chemical, power, mining, and cement firms as its core enterprises.

The city hosts some of the biggest industrial companies in Uzbekistan—Navoi Mining and Smelting Plant, Navoiazot OJSC, JV Electrochemicalplant JSC, Kizilkumcement JSC, and Thermal Power Plant Navoi—and forms the economic base of the Navoi region.




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