Kurpayanidi Konstantin Ivanovich
Fergana Polytechnic Institute, Uzbekistan
Phd, professor of "Economics", Professor of Russian Academy of Natural Sciences

Study the issue of effective regulation of business, the key elements of institutional support of entrepreneurship in Uzbekistan, the interaction of business with the government; financial, industrial and technological institutes; institutions that ensure the availability and transparency of information for the business. Analyzed the regulation of business, the creation of the external business environment in which will be provided with the most favorable conditions to support the development of entrepreneurship in the optimal combination of the interests of entrepreneurs and the state. On the basis of the international ranking of business environment Doing Business proposes concrete measures to improve institutions of entrepreneurship in Uzbekistan.

Keywords: entrepreneurship, infrastructure, institutional environment, international ranking, the quality of the business environment.

Category: Economics

Article reference:
International ranking as a method of evaluation of the effectiveness of the state support of entrepreneurship // Humanities scientific researches. 2016. № 1 [Electronic journal]. URL:

View this article in Russian

Economy of the Republic of Uzbekistan is influenced by the processes of modernization of the existing model of development predetermines, along with the crisis in the global economy, and the challenges of globalization, an active transition of developed countries as its main competitors on the innovative path of development, the development and use of new business strategies to be successful in an increased competition [4,14]. These factors, along with the implemented in the country competition policy, have a significant impact on the competitive situation in Uzbekistan, and is closely related to the competitiveness of its key market actors business structures.
Modern business is conducted through the institutions of market infrastructure – a set of interrelated design and technology, information and production and organizational systems. It allows you to carry out a full cycle of business – from the initial idea to the final practical implementation in the form of a particular product or service[4]. Entrepreneurial institutional framework for the successful operation should also have a favorable regulatory framework and effective system output markets products enterprises. Hence the problem of forming the institutional infrastructure is one of the most serious and urgent[12].
At the same time, all the components of the institutional infrastructure of entrepreneurship: the interaction with the government, financial institutions, security technology and production capacity, transparency and accessibility of information – yet still does not meet the strict competitive market conditions and do not provide the growth of economic efficiency of entrepreneurial activity. The situation is aggravated by the major regional differences in the institutional support of entrepreneurship[16].
Unequal opportunities of entrepreneurs, often lead to a breach of applicable law, redistribution of roles between public authorities, instability and lack of transparency of financial markets, lack of prudential supervision over the actions of the subjects of relations[10]. In the context of blurring the institutional environment, place the institutional vacuum can take the system inefficient institutions – institutional traps, informal lobbying, corruption and the shadow economy[11].
In our opinion, the effective regulation of business activity – is the creation of external business environment in which will ensure the most favorable conditions to support the development of entrepreneurship at the optimum combination of interests of employers and the state[14].
The question of determining the efficiency of enterprise development Many studies, including the work of scientists of Uzbekistan, such as R. Alimov, A.Hikmatov, B.Berkinov, A.Vahobov, S.Gulyamov, M.Ikramov, A. Kadyrov, N.Mahmudov, K .Muftaydinov, D. Trostyansky, M.Tursunhodzhaev et al., as well as a number of scientists of the Russian Federation L.Abalkina, V.Avtonomova, A. Blinov, A. Vilensky, T. Dolgopyatova, O.Krivoruchko, I. Razumnova, V. Roubaix A.Yudanova and economists from Europe and the United States.
Traditional measures of efficiency regulation of small and private business (SPB) are quantitative indicators such as the proportion of subjects SPB in gross domestic product (GDP), as well as the number of people employed in the SPB. According to the State Statistics Committee of Uzbekistan, the share of the contribution of SPB in Uzbekistan’s GDP in 2003 was 35.0%, in 2013 – 55.8%, and 2014 subjects of small business made 56.1 percent of total GDP, which is 0.3 percentage points more than in the same period last year. Implemented measures to build the business environment, comprehensive support and further stimulate the development of small and private businesses contributed to the creation in 2014 of more than 26 thousand [19]. New small businesses (excluding farming enterprises). In 2014 small businesses (business) produced 56.1% of the total GDP, which is 0.3 pp. more than in the corresponding period last year. It is well known that in OECD countries, this figure is much higher, for example, in Germany the proportion of MB in the country’s GDP of about 57% in the UK – 52%, while in the US – 53%. According to the Statistics Agency of the European Union in 2012, the share of enterprises with fewer than 250 employees accounted for about 58% of the total GDP of the European Union, the share of such business entities from the total number of operating companies in Europe was 99.8%, and all of these companies instead of giving employment 66 9% of the total working population of the EU countries[23,24].
In Singapore, there are about 130,000 enterprises MB. This is 92% of all enterprises in the country. They account for about 35% of value added products and Bole e 25% of Singapore’s GDP. In addition, 7% increase in employment in the year also provides small and medium businesses. Therefore, the government strongly supports the development of this sector. Advanced development of this sector since the first days of non-dependence in Uzbekistan has become an important driving force in solving the crisis problems left over from the planned distribution system. The most important task was assigned to small businesses in solving the acute social problems for the country – ensuring full employment. For comparison, the number of employees in SPB as of September 1, 2015 to the Republic of Uzbekistan was 77% of the economically active population. However, for a country with the structure of the economy, like Uzbekistan, but these numbers are not able to give an objective assessment of the extent to effectively created the conditions for the development of SPB in the country. What is needed is a different system for assessing the business environment in the country.
When it comes to the practical evaluation of the effectiveness of institutions, noted the significant role of international organizations, conducting large-scale cross-country studies, which are developed on the basis of various ratings and rankings of institutional quality[8].
Among the basic tools of analysis of the institutional environment in the economic and business environment today stand out: survey «Business Environment and Enterprise Performance Survey» (BEEPs), conducted jointly by the World Bank and the European Bank for Reconstruction and Development; competitiveness survey of the World Bank «Investment Climate Assessment» (ICA) and the study of the World Bank and the International Finance Corporation «Doing Business» (“Doing Business”); Reviews competitiveness of the World Economic Forum; assessing the quality of political institutions and public administration, conducted by the World Bank in the project under the guidance of Kaufman; International Corruption Perceptions Index Transparency International; analysis of political institutions in the index Policy IV; various gauges freedoms, including freedom of the press, from Freedom House and others [20].
All of these tools are constantly being improved and include a wider range of variables that measure not just the quality of individual institutions, but also the overall quality of the business environment.
In Uzbekistan, the practical study of the institutional environment is carried out both in the scientific community (e.g., Center for Economic Research, Research Center at the Tashkent State Economic University) and business associations (Chamber of Commerce, the Association of Banks of Uzbekistan, Business Women Association of Uzbekistan).
In order to radically improve the business environment, create the most favorable conditions for doing business, reduce, simplify and improve the transparency of all types of procedures relating to the activities of enterprises, the introduction of internationally accepted system of evaluation criteria of the business environment and on this basis to further improve the international rating level business and investment climate in Uzbekistan 18 July 2012 was adopted by Presidential Decree UP-№4455 «On measures to radically improve the business environment and providing greater freedom of entrepreneurship.” According to the acceptance documents of the Ministry of Economy and Finance, Central Bank, together with the relevant departments and agencies in accordance with the World Bank and the International Finance Corporation division method of forming the report “Doing Business” great work on factor analysis of the business environment and the introduction of evaluation criteria and indicators determining the country rating. Government set the strategic task of improving the country’s rating according to the criteria of the report “Doing Business”[1].
For example, the report “Doing Business – 2015″ – the twelfth in a series of annual reports, which are exploring business regulations, as contributing and hindering business development. The report presents quantitative indicators characterizing the business regulations and the degree of protection of property rights. These indicators can be used to match the business environment for 189 countries. The report provides estimates of regulations concerning 10 aspects of the life cycle of enterprise, namely: creation of the enterprise; obtaining building permits; connection to the power supply system; property registration; access to credit; investor protection; taxation; conduct foreign trade activity; enforcement of contracts; solution to the problems of insolvency of companies.
In the report “Doing Business 2015 – Going beyond effectiveness” data are as of June 1, 2014[22]. The indicators are used to analyze economic outcomes and provide a glimpse of what reforms of business regulation proved to be effective in what areas and countries, and why. The report notes that in 123 countries, local entrepreneurs have noted positive changes in the legal environment governing business activities that have taken place over the past year. From June 2013 to June 2014, a report covering 189 countries, recorded 230 reforms business regulation – of whom, 145 reforms were aimed at simplifying and reducing the cost of compliance and the 85 reforms were aimed at strengthening legal institutions.
The study “Doing Business” expanded field of study for three of the ten indicators and next year plans to expand the area of study for another five indicators. In addition, the aggregate rating of ease of doing business index is now based on the distance from the forward line.
This indicator shows how the legal regime governing the activities of local businesses of any country, close to the best practices in business regulation. The higher the score obtained in terms of distance from the forward line, the more favorable business environment and strong legal institutions in the country. Uzbekistan in this ranking has risen by 8 points compared with a rating of “Doing Business 2014″ – from 149th place in the 141′s. The most noticeable improvement in Uzbekistan noted in the field of taxation – the country on this indicator has risen from 179th to 118th place. Improving the ranking is also recorded on indicators such as the protection of minority investors (100th place, 18 positions), registering property (143, 3), connection to the grid (145, 3) and enforcing contracts (28 + 1). Deterioration occurred in terms of ranking “business registration” (65, -5), “access to credit” (104, -5), “the resolution of insolvency” (77, -5) and “construction permits” (149, -2). Remained unchanged conditions for the conduct of international trade (189th place). Since 2014 ranking ease of doing business index supplemented distance from the “forward line”, ie, from the best result for the duration of ratings (measured on a scale from 0 to 100, where 0 – the worst result). Change to Uzbekistan on this indicator was 4.24 percentage points (from 50.02 points in 2014 to 54.26 points).
Analyzing the reasons for the rating change Uzbekistan, one can identify a number of factors, which are characterized by the adoption of legal acts, improving or liberalizing many procedures related to business activities and interaction with public authorities and institutions.
Considering in greater detail. Over the study period, the government of Uzbekistan has significantly reduced the time required for the procedures required for the implementation of export-import operations, including through the implementation of information systems to feed and process the relevant documents through the web interface.
Along with the cancellation of the procedure of registration of foreign trade contracts with authorized banks business entities were able to submit electronic data on these contracts into a single electronic information system of foreign trade operations (EEISVO) through a single portal online public services using digital signatures. These measures are provided in April by the Presidential Decree “On additional measures to further improve the investment climate and business environment in the Republic of Uzbekistan” NUP-4609, as well as the Cabinet of Ministers of 07.21.2014 N 199 “On additional measures to improve the monitoring of foreign trade operations in the Republic of Uzbekistan “.
Improving customs procedures is another important points of program reforms aimed at liberalizing the business activity. In particular, Uzbekistan reduced the number of documents requested by the customs authorities and to simplify the process of submission and receipt.
Thus, pursuant to paragraph 5 of Presidential Decree N UP-4455 of 18.07.2012, “On measures to further radical improvement of the business environment and providing greater freedom of entrepreneurship.” State Customs Committee of Uzbekistan with the January 1, 2013 is provided as an interactive services via the Internet procedure of electronic declaration of goods, which minimizes the human factor at the customs clearance of goods, as well as significantly reduce the time of customs clearance. Also in accordance with the Government of 29.12.2012, N 370 with January 1, 2013 business entities entitled to choose to implement the procedure of customs clearance of goods in electronic form[13,17].
Favorably affect the position of investors in the country to adopt a new version of the Law N 223-I dated 26.04.1996, “On joint-stock companies and protection of shareholders’ rights” (Law of 05.06.2014, N LRU-370). New edition of the Act sets higher requirements for disclosure of related-party transactions committed by interested directors of the Company, as well as the inclusion of information on such transactions in the relevant annual reports of joint stock companies. In addition, any shareholder entitled to request and obtain all documents relating to the above transactions. The adoption of these standards further strengthened the protection of minority shareholders, which in turn is reflected in the increase in the rating of 18 points. It is especially necessary to note that in the ranking, reflecting the tax system, Uzbekistan rose by 61 positions. In our opinion, the main factor for positive change is the annual reduction in tax rates. So, if in 2000 the income tax rate was 38% after 5 years it dropped to 15%, and the rate of the single social payment is reduced from 40% to 25%. Methodically and progressively reduced single tax rate. For example, established in 2005 at a rate of 13% for industrial enterprises in 2015, it is 5%[3].
Pay attention to the position in the ranking of countries in the former Soviet Union.
1. Georgia (15th place ranking).2. Estonia (17).3. Latvia (23).4. Lithuania (24).5. Armenia (45).6. Belarus (57).7. Russia (62).8. Moldova (63).9. Kazakhstan (77).10. Azerbaijan (80).11. Ukraine (96).12. Kyrgyzstan (102).13. Uzbekistan (141).14. Tajikistan (166).
As can be seen from the ranking of countries on the ease of doing business, the ninth consecutive year, Singapore led the world rankings. The second to tenth places are occupied, respectively, New Zealand, Hong Kong (China), Denmark, the Republic of Korea, Norway, USA, UK, Finland and Australia.
Based on the foregoing, it can be concluded that the main problems of entrepreneurship in Uzbekistan, identified by analysis, the international and domestic surveys are as follows: poor quality of the bureaucracy; access to economic resources; obtaining building permits; not match the competitive conditions of the financial sector; regulation of foreign economic relations; ineffective treatments closing a business.
To solve the above problems, we have considered necessary to improve the basic functions of the state in the regulation of the institutional environment of entrepreneurship.
Improving coordination functions of the state, ie, decrease in the degree of uncertainty of the business environment should disable the following:
• creating conditions for the expansion of competitive and export-oriented enterprises (improvement of the situation with the receipt and registration of land and construction permits, improving legislation on plant closures, better regulation of foreign economic activity)[15,25];
• ensuring the stability, consistency and cost-effectiveness of the legal system.
The development of the management function of state institutions (which determines the distribution of resources, benefits and costs for the employer) is:
• development of financial institutions, including the availability of infrastructure investment process and a variety of financial actors;
• entrepreneurs providing government guarantees in respect of property rights institutions;
• improving the efficiency of the impact of natural resource revenues.
The ratio of formal and informal institutions includes:
• improving the efficiency of the fight against corruption.
• another measure to combat informal institutions is a continuation of the administrative reform, which is the most important component – increasing openness, transparency and accessibility of information through active and effective implementation of mechanisms to meet the challenges of the “Electronic Government» – Government-to-Citizen – G2C, as well as the optimization of the activities of authorities in the provision of interactive services through the Center for Development of “Electronic Government” under the Ministry for Development of Information Technologies and Communications of the Republic of Uzbekistan.
Thus, only the concerted efforts of the state to further removal of administrative barriers to business entities SPB can make a difference and help businesses SPB take its place in the new market of the Eurasian Economic Community, and to facilitate the accession of Uzbekistan to the WTO.

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