Association "Uzbekcharmpoyabzali" “INVESTMENT POTENTIAL OF LEATHER AND SHOES INDUSTRY REPUBLIC OF UZBEKISTAN”

Association "Uzbekcharmpoyabzali" created by the Decree of the President of the Republic of Uzbekistan Number 2552 of February 23, 2000. The main objectives of the association is to coordinate the activities included in the industries of economic entities on the harvesting and processing of leather raw materials, the release of his competitive products, footwear, garments and leather goods. Carry out common technical and investment policy, the broad attraction of foreign investment, the introduction of advanced technology, modernization and technological re-equipment of enterprises.

Association "Uzbekcharmpoyabzali" The Association consists of 92 manufacturing plants, including: - 13 companies for procurement of raw hides; - 29 enterprises Leather processing; - 45 enterprises for the production of footwear; - 4 companies for leather goods; - 1 plant for the production of artificial leather;      

The growth dynamic of marketable products for the 2012-2016 years (thous.doll.)

The growth dynamic of volumes of production of footwear for the 2012-2016 years (thous. pair)

The growth dynamic in exports of products for the 2012-2016 years (thous. doll.)

Association Structure Men’s shoes Women’s shoes Children’s shoes Sport shoes Shoes Uzbekcharmpoyabzali Wet-blue Crust Finish Design centre Leather Purse Belt Bag Cover Garments Design institute “Agrosanoatloyiha” Design shoes Design leather goods Different projects for new organization enterprises Leather goods

“Uzbekcharmpoyabzali” - size and growth MEMBERS - 92 Foreign & JV - 25 Uzbek - 67 Attracted Investment (last 5 years) – $250,0 mln. FDI - $ 60,0 mln. Local/bank credits - $190,0 Bln. EMPLOYEES – 26 000

The tax and customs privileges for foreign investors 1. All small businesses are exempt jobs not more than 300 people from all taxes until 2020. 2. In order to develop the sector and attract investments, by the government established the basic tax and customs privileges and preferences for the industry. In particular, the tax and customs privileges: more than 0.3 million USD - for 3 years more than 3.0 million USD – for 5 years more than 10.0 million USD - for 7 years

Factors attractiveness of the industry for investors Stable raw material base Low energy costs Highly skilled inexpensive labor The developed network of communication, banking services A significant market for finished products

Factors of competitiveness Item Power Cattle 4,3 mln. peaces Small cattle 8,2 mln. peaces Shoes 12100 + thousand pairs Skilled labor resources up US$ 300/month 3 Institute of Light Industry & Textile in Tashkent city, Bukhara city and Namangan city, 12 Specialized colleges Granting into the ownership of production areas at the zero rate Domestic market of 32 mln. population CIS market of US$ 16,0 bln. in FTA Item Power Water 0.25/1m3 Natural gas 0.05/m3 Power energy 0.04/kWt/h Petroleum 0.86/1 Diesel 0.78/1

Proposed directions to organize new production Creating a new production of leather goods and leather garments Creating a new production of children’s, women’s, men’s and sports shoes

Organization of production of leather goods Cost of the project : 0,5 – 1,5 mln. doll. USA as: Construction of buildings; Supply of technological equipment; Supply of raw materials. Production capacity : 100 to 400 thousand pcs Payoff period : 2 to 3 years Create jobs : 50 to 150 places Factors determining the prospects of the project: The growing demand of the local population and the ability to export to the CIS countries, Central Asia, the need for which 70% provided by imports.  Availability of skilled labor and local high quality raw materials

Organization of production of sports shoes Cost of the project : 1,0 - 2,0 mln. doll. USA as: Construction of buildings; Supply of technological equipment; Supply of raw materials. Production capacity : 100 to 500 thousand pcs Payoff period : 2 to 3 years Create jobs : 50 to 150 places Factors determining the prospects of the project: The growing demand of the local population and the ability to export to the CIS countries, Central Asia, the need for which 50% provided by imports.  Availability of skilled labor and local high quality raw materials

Organization of production of children's shoes Cost of the project : 1,0 - 2,0 mln. doll. USA as: Construction of buildings; Supply of technological equipment; Supply of raw materials. Production capacity : 100 to 300 thousand pcs Payoff period : 2 to 3 years Create jobs : 50 to 120 places Factors determining the prospects of the project: The growing demand of the local population and the ability to export to the CIS countries, Central Asia, the need for which 70% provided by imports.  Availability of skilled labor and local high quality raw materials

Organization of production of women's shoes Cost of the project : 1,0 - 2,0 mln. doll. USA as: Construction of buildings; Supply of technological equipment; Supply of raw materials. Production capacity : 100 to 500 thousand pcs Payoff period : 2 to 3 years Create jobs : 50 to 150 places Factors determining the prospects of the project: The growing demand of the local population and the ability to export to the CIS countries, Central Asia, the need for which 60% provided by imports.  Availability of skilled labor and local high quality raw materials

Organization of production of leather garments Cost of the project : 0,5 – 1,5 mln. doll. USA as: Construction of buildings; Supply of technological equipment; Supply of raw materials. Production capacity : 100 to 200 thousand pcs Payoff period : 3 to 4 years Create jobs : 70 to 200 places Factors determining the prospects of the project: The growing demand of the local population and the ability to export to the CIS countries, Central Asia, the need for which 80% provided by imports.  Availability of skilled labor and local high quality raw materials

Organization of production of men's shoes Cost of the project : 1,0 - 2,0 mln. doll. USA as: Construction of buildings; Supply of technological equipment; Supply of raw materials. Production capacity : 200 to 500 thousand pcs Payoff period : 2 to 3 years Create jobs : 50 to 150 places Factors determining the prospects of the project: The growing demand of the local population and the ability to export to the CIS countries, Central Asia, the need for which 60% provided by imports.  Availability of skilled labor and local high quality raw materials

Association “Uzbekcharpoyabzali” 100000, Tashkent city, st. Mustakillik 109 Tel: (+99871) 267-5847 Faks: (+99871) 267-5879 www.uzcharm.uz E-mail: info@uzcharm.uz