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. Last Updated: 07/27/2016

Uzbekistan To Privatize 700 Firms

President Islam Karimov of Uzbekistan has signed a decree privatizing 700 unprofitable state farms, Interfax reported Monday.

The farms will be reorganized into private farms, joint-stock societies and cooperatives. Their buildings, facilities and equipment will be given to the new owners free of charge, the news agency said.

In addition, the government will extend the repayment time on farmer's debts to the state by 20 years. The new farming units will be financed by a newly established state bank.

Interfax also reported government plans to attract foreign capital and reduce the state order for agricultural products. The state order for cotton will be reduced from 85 to 80 percent. Farmers will be given the right to sell the remaining crop at free prices. The government estimates this could net 20 billion rubles in revenue to the farmers.

Karimov, an ex-Communist boss with a reputation as a slow mover on reforms, had previously passed such a decree. In October 1991, he allowed collective farmers to sell part of their cotton harvest for export. But six months later, he issued a second decree requiring the farmers to first gain government permission, which effectively reversed his initial liberalization.

The Uzbek agricultural ministry estimates that 12, 537 private farms have been established. A recent poll of Uzbekistan's rural population found wide support for farm privatization. The report said 57 percent of state and collective farm workers would like to own their own farm.

About 20 percent of agricultural specialists and enterprise managers said collective farms had exhausted their usefulness and no longer had a future. Respondents also said that private farming was being held back by the lack of funds and by the opposition of local authorities.