State Ownership of Land in Uzbekistan – an Impediment to Further Agricultural Growth?

Abstract

The present paper aims to demonstrate how the state land ownership affects development of agricultural sector in Uzbekistan, and what are its strengths and weaknesses. It highlights the importance of secure land right regardless of ownership. Land in Uzbekistan is state-owned; the exclusive state ownership of land was first incorporated in the 1992 Constitution. The official rationale was to ensure food security and social stability; another concern was the state-run irrigation system, operation of which would be hampered in the event of land privatization.

Farming entities in Uzbekistan possess different rights to land: from long-life inheritable rights of the dehkans (small-scale household farms) to rights limited by 30 to 50 years and defined by lease contracts of the private farmers. The latter are monitored by the state and are subject to state interventions; in the first place they have to carry the burden of state quotas for cotton and wheat and they are obliged to sell these crops for state-dictated prices. Dehkans provide a major part of livestock production and they can, unlike private farmers, sell all their production at market prices.

Land tenure rights in Uzbekistan lack certain qualities that would make land tenure rights meaningful. The duration of land rights is sufficient, however they do not assure the holders that rights will be recognized and enforced at low costs and do not provide them with mechanisms allowing adjustment under changing conditions.The authors conclude that the insufficient land tenure security, which is further undermined by state interventions, poses a significant barrier impeding development in the agricultural sector. The paper identifies opportunities for change arising from the gradual strengthening of market principles.