2013-12-09 12:09:28 - New Healthcare market report from Business Monitor International: "Uzbekistan Pharmaceuticals & Healthcare Report Q1 2014"
Our projections for the Uzbek pharmaceutical and healthcare markets going into 2014 are broadly bearish. The country continues to rank as the least attractive in the region in our RRR ratings matrix, and real GDP growth is set to decline. We note that there have been some positive developments in recent months, such as impetus to improve the healthcare sector, investment from state-run Uzpharmprom to develop domestic production and Chinese investment to supply some economic stability. However, it will be years before the impact of these long-term developments is felt.
Headline Expenditure Projections
Full Report Details at
- www.fastmr.com/prod/752072_uzbekistan_pharmaceuticals_healthcare ..
* Pharmaceuticals: UZS989.11bn (US$520mn) in 2012 to UZS933.65bn (US$420mn) in 2013; -5.6% in local currency terms and -19.1% in US dollar terms.
Forecast in US dollar terms downwardly revised from previous quarter.
* Healthcare: UZS5,749.74bn (US$3.05bn) in 2012 to UZS7,195.26bn (US$3.27bn) in 2013; +25.1% in local currency terms and +7.2% in US dollar terms. Local currency forecast upwardly revised, downgraded in US dollar terms.
Risk/Reward Ratings: Uzbekistan remains the least attractive market in Central and Eastern Europe, which covers 20 key markets. Uzbekistan scores below the regional average for all indicators in our proprietary ranking system, its total score of 34.6 far below the regional average of 52.0. We see some scope for this to improve, with the government having allocated funds to improve healthcare facilities and infrastructure. However, the situation remains unpromising for pharmaceutical players in the medium term, with international drugmakers facing a ban on medicine imports.
Key Trends And Developments
* In August 2013 Uzbekistan's state-run pharmaceutical firm Uzpharmprom disclosed that it will spend an additional US$65mn until 2015 to develop Uzbekistan's pharmaceutical industry. The company has developed 10 additional projects to boost domestic production of infusion solutions, bandage materials and around 20 new generic drugs. These projects will be incorporated in the pharmaceutical industry's mid-term development programme. The projects will receive funding of US$27.3mn from Uzpharmprom, US$32.7mn through loans from local banking institutions and US$5mn through foreign investments.
* Indicating increased scope for investment in the sector, in August 2013 Argentina-based Integradd announced it will open a new facility for the production of injection solutions in ampoules in the Uzbek city of Samarkand. The company has completed construction works at the facility and is currently engaged in installing new equipment at the site. The Uzbek health ministry's licensing committee has granted a licence to Integradd for the production of drugs in the country.
BMI Economic View: Real GDP growth in Uzbekistan is set to decline over the course of 2014 and 2015, as Uzbek exports become increasingly uncompetitive relative to Central Asian peers. Kyrgyzstan and Tajikistan are potentially set to join the Russia-Kazakhstan-Belarus customs union in the next two years, which will leave Uzbekistan and Turkmenistan (which can rely on its vast gas deposits to prop up real GDP growth) as the only Central Asian states outside of the group. While Tajikistan and Kyrgyzstan account for only a small proportion of Uzbek trade, they could begin to offer stiff competition to Uzbek exports to the customs union states, most notably in the areas of cotton and agricultural products.
BMI Political View: Tensions between Uzbekistan and Kyrgyzstan are set to remain elevated over the short term, following a border shootout in July 2013 that left one Uzbek guard dead and another injured, and clashes between ethnic Uzbeks and Kyrgyz in southern Kyrgyzstan. While we do not expect the violence to escalate into full-scale conflict between the two states, the developments do little to improve Uzbekistan's political risk profile.
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