U.S. Department of State

The graph shows Uzbekistan's economic reform scores in 2004* (the gray shaded area) as compared to its economic reform scores in 1999. For example, the greatest progress as compared to 1999 has been made in the area of 3-year average inflation.

*Actual 2005 scores not yet available.

FY 2005 Country Program Performance

Democratic Reform

The deterioration in the relationship between the USG and Government of Uzbekistan (GOU) has significantly affected democratic reforms in the past year. The role of civil society groups has been seriously curtailed and it is inconceivable that independent political parties will become a significant force in the near future. In response to the perceived threat that civil society and democracy-based NGOs pose, the GOU deputized the MOJ to control NGO activities within Uzbekistan. In 2004, the MOJ began audits of many international NGOs operating in Uzbekistan. While these have stopped, the break seems to be temporary, as the MOJ has mentioned plans to restart investigations in 2006. The audits have led to court proceedings against three USG implementing partners; two of which subsequently have ceased operations (the third case has not been decided as of the date of this report). All USG partners and partners of other donors have at one time or another been affected by banking restrictions and difficulties obtaining visas and accreditation for expatriate staff. Despite these difficulties, many democracy/civil society programs are making measured progress as USG partners are finding ways of providing direct support, training, and advocacy for anti-trafficking and civil society strengthening activities.

U.S. ASSISTANCE PRIORITIES

The USG broadened the definition of civil society to include non-traditional groups. Additionally, USG assistance focused on human rights protection and advocacy, expanding housing reform activities (condominium associations), conflict prevention activities related to local economic development, access to information, and economic opportunity for youth, combating trafficking in persons (TIP), and studying the feasibility of information dissemination through a new satellite (direct-to-home) broadcast program.

PROGRAM PERFORMANCE

Despite the increasingly hostile environment and the overall negative trends in terms of democratic reforms and protection of human rights in Uzbekistan over the past year, USG partners continued to work and achieved some successes. Even after the events in Andijon, the GOU has shown some willingness to engage in dialogue, providing limited optimism for future reform.

Anti-TIP programs made a positive impact. Approximately, 17,000 people were trained on the dangers of trafficking-in-persons. Procedures for repatriating victims were streamlined, with a reduction in the time for confirming the nationality of trafficking victims from six months to one week. The USG sponsored a shelter in Tashkent for trafficking victims, the first shelter of its kind in Uzbekistan. The shelter provides living quarters, legal and medical assistance, and rehabilitation for victims. The facility opened with a waiting list and in 2005 provided shelter for 68 victims. While the GOU prosecuted a higher number of traffickers, almost all were amnestied under provisions of legislation that provide for amnesty for first-time offenders.

The Civil Society Development Program suffered significant setbacks when the GOU suspended the USG's implementing partner for six months (and subsequently ordered the organization liquidated) and forced the network of support centers to close down; however, many of the network organizations converted into commercial non-profit organizations so that they could continue operations. The expected nationwide civic advocacy campaigns did not materialize due to the inability of partners to obtain program funding and the overall deteriorating environment. Nonetheless, many NGOs continued to advocate, with some success, at the regional level on "national level" issues.

The only area where the USG was able to meet expectations in terms of strengthening civil society was in the development of condominium associations in six sites. These programs were slowed by difficulties with transferring money, but were able to continue operations. Because local governments no longer have the resources to effectively manage large apartment blocks, they welcomed the technical assistance and training that enabled these associations to assume responsibility for maintenance and utilities.

The USG continues mitigating conflict in targeted communities of Uzbekistan, where tensions grow as a result of ethnic divides and uneven resource allocation, by raising citizen participation in decision making, improving the delivery of social services, and creating employment. This year, the USG concentrated its conflict programs on 110 communities in the Fergana Valley and the regions of southern Uzbekistan. These interventions addressed availability of services and access to job opportunities, especially for youth. More than 500 infrastructure and social projects have been completed over the span of the project, benefiting more than a million residents. Projects resulted in 3,512 short-term and 1,324 long-term jobs. In FY 2005, on average, 37 percent of total project costs came from community contributions, which represented a positive trend. Communities have continued to implement their own projects without USG financial support, which doubled the total value of such projects since last year. There were 175 such projects reported in FY 2005, with a value of $665,000, representing a 25 percent increase over the course of a year. Projects include community centers offering vocational training and space for small enterprises; and construction of a local market and irrigation system to boost farming production and trade.

The USG's Religion, State and Society (RSS) Initiative was a new program which began work at the close of FY 2004 when a RSS Specialist was hired. During FY 2005, the RSS Specialist carried out outreach efforts to Muslim communities through two bus tours in southern Uzbekistan, regular meetings with Islamic and community leaders, and a lecture on "Islam in the United States" for university students. In addition, the USG sponsored participation in international conferences and workshops on the relationship between religion and democratic public life. These and other embassy outreach efforts allowed the USG to maintain positive relations with Muslim religious leaders in Uzbekistan. RSS program elements were also developed to address religious freedom issues in the USG's human rights programming and to proactively include religious believers in other USG programs.

In FY 2005, the Embassy's Democracy Commission Small Grants program distributed $289,000 among 51 NGOs working in the fields of human rights, mass media and civil society. Several human rights groups received grants to monitor and report on human rights violations, focusing on cases of religious or political persecution. Others received funds to raise legal literacy or to curb domestic violence or trafficking in women and girls. Grants to mass media organizations will help support, among other activities, workshops on ethics and investigative journalism as well as the publication of articles exploring social issues and providing readers with self-help information. The goal of advancing civil society will be furthered through grants supporting a student model parliament, Internet access and training centers and workshops on solving community problems.

MEASURES OF PROGRAM EFFECTIVENESS

In order to determine how U.S. Government assistance affects a country, U.S. embassies set targets for improvement called "performance indicators." Data for these indicators are collected by research institutes, embassies and international organizations. By examining data over time, U.S. policymakers better understand whether specific assistance programs are making their intended impact and, if necessary, how to adjust these programs to improve the impact.

Please find below two important indicators in the area of Democratic Reform. In the charts, the "Baseline" refers to a starting point from which to measure progress or regression over time. The embassy and its partner organizations then agree on a "Target" figure that they hope to achieve as a result of U.S. assistance programs. The "Rank" figure is the resulting measurement. "CY" stands for "calendar year," or January 1 to December 31, while "FY" stands for "fiscal year," the period of the U.S. budget that runs from October 1 to September 30 of the following year.

Performance Indicator: Independent Media Rating. The Freedom House rating addresses the current state of press freedom, including libel laws, harassment of journalists, editorial independence, the emergency of a financially viable private press, and Internet access for private citizens. Measurement is on a 7-point scale, with 1 being the best, 7 being the worst. The 2005 rank is based on 2004 data. Source: Freedom House Nations in Transit 2005. Found online: www.freedomhouse.org/research/nattransit.htm.

Uzbekistan officially abolished censorship of the media in 2002. However, there was no improvement in press freedom during FY 2005. Journalists who reported views contrary to government policy continued to be harassed and intimidated by GOU officials. Roughly 80 percent of the media is state-owned and the GOU has taken steps to prevent the few independent media outlets that exist in the country from providing information to Uzbek citizens. In 2005, the BBC closed its Tashkent office and the GOU declined to extend the accreditation of Radio Free Europe/Radio Liberty. In addition, the GOU forced Internews Uzbekistan, a media NGO largely funded by the USG, to end its operations in Uzbekistan and leave the country. Internews was ordered liquidated by the Tashkent City Court ostensibly because the organization's international management and documentation practices were in violation of Uzbek law. However, the USG believes the decision to close Internews was political in nature and reflects GOU opposition to the organization's efforts to develop independent media outlets in Uzbekistan.

Performance Indicator: NGO Sustainability Index. Seven different dimensions of the NGO sector are analyzed each year in the NGO Sustainability Index: legal environment, organizational capacity, financial viability, advocacy, service provision, NGO infrastructure and public image. The NGO Sustainability Index uses a seven-point scale, to facilitate comparisons to the Freedom House indices, with 7 indicating a low or poor level of development and 1 indicating a very advanced NGO sector. The 2005 rank is based on 2004 data. Source: USAID. Found online: www.usaid.gov/locations/europe_eurasia/dem_gov/ngoindex/2004/.

The environment for civil society development in Uzbekistan has deteriorated significantly as a result of the events in and around Andijon in 2005. The NGO sector was negatively affected by the deterioration of the economy and overall misuse of power and harassment from government. If before the government would restrict the activities of only human rights organizations, after the Andijon events all independent NGOs have been monitored, checked and many have been asked to close down "voluntarily". Regardless, some NGOs fought against illegal actions by the Ministry of Justice in the courts. Banking restrictions enacted in 2004 have left 90 percent of NGOs without foreign grant money for the past two years, although some organizations have been able to diversify funding sources and start working with members and constituencies. At the beginning of the year some NGOs managed to conduct advocacy campaigns even at the national level, though by the end of the year it seemed impossible to do so. In general, NGOs are being either forced out of business or harassed by state-controlled organizations.

Economic Reform

Governance in Uzbekistan remains centralized and over-regulated. The normal practice for doing business involves corruption at all levels. Uzbekistan is plagued by widespread underemployment and unemployment, poor social infrastructure, weak educational and health facilities, and pervasive government interference and human rights abuses. Nearly one-third of Uzbeks live below the national poverty line. As part of a larger import substitution policy for economic development, the government strictly regulates border trade and cash circulation. Crippling import controls have severely restricted regional trade and led to several public arguments between traders and government officials in the last two years that caused the GOU to backtrack on policies subjecting traders to stricter government control. With approximately 50 percent of the population below the age of 30, and youth unemployment estimated as high as 30 percent, pressure on the government to institute genuine economic reform is mounting. Estimating unemployment is a difficult and imprecise science, as official numbers are not accurate. In addition, the government does not officially track underemployment, a significant problem in the country.) The banking system remains under state control and desperately needs reform. The National Bank of Uzbekistan, the country's largest bank, is plagued by corruption scandals and is barely solvent. The banking sector lacks public trust. The GOU is not exercising effective and efficient management of its natural resources (water, natural gas, etc.). Over the past year, there has been further centralization and consolidation of government control over the economy. The highly centralized government structure results in nepotism and corruption, compounded by enormous red tape. Inconsistent legislation gives room for arbitrary interpretation and application, and ensuing abuse of power. Because of the GOU's lack of progress in several key areas including economic and democratic reform, the USG has suspended, with a few exceptions, assistance programs involving the central Government of Uzbekistan.

In FY 2005, Uzbekistan continued to enact policies driving the country further away from a market economy. During the first nine months of 2005, the GOU strictly controlled access to local currency (the soum) as an attempt to control inflation. However, during the last three months of the year, the Central Bank allowed freer soum circulation while strictly controlling hard currency. The Central Bank also took steps to restrict current account convertibility, causing the black market exchange rate to surge above the official rate. GOU economic policies and reluctance to implement true market reforms have created a difficult environment for both local and foreign businesses. Though the government issued several new decrees geared towards giving the private sector greater protections, in actuality little has changed. Increasing inflation, strangling bureaucracy and economic policies, and decreasing purchasing power among the market have further stifled private sector growth. Despite official announcements that the May unrest in Andijon was unrelated to the economic concerns of the population, throughout the summer the GOU took steps to inject money into the Fergana Valley by paying wage and pension arrears and providing small loans to start family businesses.

U.S. ASSISTANCE PRIORITIES

The agricultural sector generates over 30 percent of Uzbek GDP, and is arguably the main income generator for 60 percent of the rural population. Declining economic conditions and reduced living standards set the environment that the USG is working in and reinforce the need to improve incomes and provide employment opportunities. While the USG's engagement with the GOU is limited at this time, current programs focus on providing direct assistance to the underdeveloped private sector. For example, providing assistance to small and medium sized enterprises in rural areas will directly impact the economy through new jobs and capital generation. Making affordable financing available to these private enterprises is also a key element of rural development, and part of the focus of the Economic Growth Strategy in Uzbekistan. The main goals of this strategy are to increase the income of the rural population by establishing strong market linkages between farmers and consumers, based on market demand; improve competitiveness through the promotion of better industrial policies, standards, trade facilitation, investment, and management, in partnership with industry associations and non-government groups; develop producer and processor organizations to facilitate technology transfer, advocacy, and productivity; improve access to inputs and markets necessary for efficient production; and, improve access to credit.

Despite the situation in the country, the GOU has continued to move forward on World Trade Organization (WTO) accession. In September, a GOU working group attended a working party meeting in Geneva to present Uzbekistan's offer on goods and services, as well as the country's legislative plan to meet WTO requirements. Despite these seemingly positive steps, the GOU maintains, and even increased, high excise taxes and customs fees. These charges, coupled with non-tariff barriers, make imports prohibitively expensive and hamper regional trade.

PROGRAM PERFORMANCE

Because the GOU did not meet the conditions required for the determination, as stated in Section 577(a) of the FY 2005 Foreign Operations Assistance Act, the USG restricted its assistance to the programs involving the central Government. During the first six months of 2005, using FY 2004 funds, the USG assisted the GOU in preparing submissions to the World Trade Organization (WTO). The program was discontinued during the last six months of the 2005. This assistance previously increased the quality of the Government's submissions, according to the WTO Secretariat. The Regional Trade Promotion (RTP) network of the Enterprise Development Project (EDP) trained four local partners in facilitating web-based trade. Together, trade advisors and local partners conducted 86 trade deals worth $9,642,994, or 28 percent of the RTP trade deals in the Central Asia Region.

Due to restrictions on central government assistance, the Economic Policy Reform Project (EPRP) has shifted its focus to identifying and supporting non-government think tanks, universities, and other entities that have potential to influence economic policymaking. The project went through a slow period after the violence in Andijon in May 2005, which resulted in evacuation of the expatriate advisor and cancellation of some activities. A positive highlight to note is continued government support for the quarterly "Uzbekistan Economy," one of the few publications that provide extensive statistical data and analysis.

In year three of EPRP, USG local business advisors helped 119 firms, leading to substantial increases in sales and productivity. The Russian language Certified International Professional Accountant (CIPA) Program continued to grow in demand and move incrementally toward sustainability. This year, 221 accountants became Certified Accountant Practitioners, surpassing the anticipated target of 150. Recognizing the value and quality of USG-supported accounting training, the Ministry of Finance proposed using CIPA exams for qualifying auditors. Efforts by the Small Equity Assistance Fund (SEAF) continued to push forward on investment opportunities but faced challenges, as the closure of a partner bank temporarily left SEAF's assets of $300,000 for business leasing frozen.

In Uzbekistan, where the banking sector is nearly entirely state-controlled and is far from being customer-oriented, access to capital is a paramount barrier to small businesses. The USG is addressing this by supporting microfinance institutions and credit unions in providing capital to micro and small business in a reliable, hassle-free, and sustainable fashion. With just one exception, all such businesses have posted robust growth rates ranging from 70 percent to over 200 percent in the past year. These rates of growth reflect the vast unmet demand for small and micro loans in the country.

The USG accomplished only a nominal amount of programmatic work under its Business and Economics Education Program, as the program was terminated in September 2005 due to an unfavorable political climate in the country.

USG assistance is helping Uzbekistan improve the management of water resources, especially water used for irrigation. Over the last five years, the USG has made significant progress in several aspects of water resources management, including in Karakalpakstan, an autonomous Republic within Uzbekistan. In 2005, Karakalpakstan partners continued to rehabilitate and extend the drinking water delivery system to over 61,000 additional residents through the provision of piping and tools, heavy equipment, and work vehicles granted by the USG. However, as the bilateral relationship has continued to deteriorate over the last year, especially following the May unrest in Andijon, USG cooperation with the Central Government has became more difficult. Even though the USG succeeded in implementing a few programs in Uzbekistan aimed at improving regional cooperation of shared water and energy resources, the GOU has not shown any interest in pursuing such measures; therefore, the USG has discontinued these programs.

One of the areas where the USG has been able to work with limited GOU support is agriculture. U.S. assistance is helping to strengthen water user associations as a means of improving water management at the farm level. More than 137,000 residents across four regions benefit from the program. The USG's latest activity in agriculture, the Agricultural Finance Plus (AgFin+) Program, was initiated this past year and began with a solid start, but slowed after events in Andijon. Approximately 370 farmers and 500 greenhouse producers in Andijon have received training from the program to date.

MEASURES OF PROGRAM EFFECTIVENESS

In order to determine how U.S. Government assistance affects a country, U.S. embassies set targets for improvement called "performance indicators." Data for these indicators are collected by research institutes, embassies and international organizations. By examining data over time, U.S. policymakers better understand whether specific assistance programs are making their intended impact and, if necessary, how to adjust these programs to improve the impact.

Please find below two important indicators in the area of Economic Reform. In the charts, the "Baseline" refers to a starting point from which to measure progress or regression over time. The embassy and its partner organizations then agree on a "Target" figure that they hope to achieve as a result of U.S. assistance programs. The "Percentage" figure is the resulting measurement. "CY" stands for "calendar year," or January 1 to December 31, while "FY" stands for "fiscal year," the period of the U.S. budget that runs from October 1 to September 30 of the following year.

Performance Indicator: Private Sector Share of GDP - In percent. Source: European Bank for Reconstruction and Development Transition Report 2005. Found online: www.esdb.cdie.org/cgi-bin2/broker.exe?_program=programs.source_ebr_1.sas&_service=default&pick=2.

U.S. sponsored programs that helped provide financing to rural small and medium sized enterprises directly impact the viability of the private sector, as do programs aimed at developing agriculture. Unfortunately, in the current environment, the most the USG can hope for is slow private sector growth with no backsliding. Given this reality, we have chosen to keep the CY 2005 target at 45 percent of GDP. According to the State Statistics Committee, the percentage of the GDP attributable to the private sector in the first nine months of 2005 totaled 37.9 percent.

Performance Indicator: Net Foreign Direct Investment, in millions of U.S. dollars. European Bank for Reconstruction and Development Transition Report 2005. Found online: www.esdb.cdie.org/cgi-bin2/broker.exe?_program=programs.source_ebr_1.sas&_service=default&pick=2

Social Reform and Humanitarian Assistance

Uzbekistan's population of almost 27 million is expected to double over the next 50 years if current growth rates remain unchanged. The result will be even greater demand on social services, especially in the health and education sectors. Unfortunately, both sectors remain critically under-funded, and recent events have further hampered meaningful dialogue with the GOU toward developing joint solutions with donors. Meanwhile, tuberculosis (TB) cure rates remain low, and infectious diseases impact a very high percentage of the population. Infant mortality remains high due to inadequate nutrition, acute respiratory diseases, and diarrhea. The HIV epidemic continues to grow rapidly. Fortunately, infection prevalence remains below 1 percent; but, among the growing numbers of IV drug users, rates range from 10 percent in some cities to 60 percent in others. Teacher salaries, facilities, and teaching materials are not close to meeting any minimal international standard. Low salaries force health care providers and teachers to establish informal payment systems that, in turn, change treatment and education priorities from a needs-based system to a payment-based system, which devastates both sectors.

U.S. ASSISTANCE PRIORITIES

Despite the rather bleak setting, the USG is able to successfully complete very specific, targeted activities in Uzbekistan, an approach the USG will continue to use in both the health and education sectors. In health, priorities will focus on technical guidance and leadership in the reform of finance, management, and quality of primary care services; support for surveillance of key infectious diseases including TB, HIV/AIDS, vaccine-preventable diseases, and pandemic influenza; technical assistance with implementation of the World Health Organization-recommended Directly-Observed Treatment Short-course (DOTS) strategy and the national HIV/AIDS response, including drug demand reduction activities; and support for policy reform on maternal and child health (MCH). In education, priorities will focus on in-service teacher training, inclusive education methods, pre-service training, management training for school principals, support for education finance reform, and increased community involvement in local schools.

PROGRAM PERFORMANCE

Ten surveillance sites for TB, covering 84 percent of the population, now use software designed by the U.S. Centers for Disease Control and Prevention (CDC), giving decision makers access to consolidated program data. Uzbekistan secured its $14 million TB grant from the Global Fund for AIDS, TB, and Malaria (GFATM), in large part though assistance from the USG. Seconding USG specialists to GFATM's implementation unit also has improved operational transparency. The USG helped Uzbekistan's TB Control Program reach 100 percent geographic coverage and decrease TB mortality and incidence rates. Better planning for drug-resistant TB and patient adherence to treatment should further improve outcomes.

CDC's sentinel surveillance revealed that in some cities, HIV infection has hit 60 percent of injecting drug users, 20 percent of prostitutes, and 9 percent of prison inmates, forewarning of a shift from a concentrated epidemic to the general population. The national HIV/AIDS program now uses this data in implementing the country's $24 million GFATM HIV grant, although acceptance has been slower for surveillance of high-risk behaviors. The Asian Development Bank's $40 million MCH program will extend CDC's USAID-funded work on blood safety. The USG's Central Asia Program on AIDS Control for Youth and High-Risk Groups (CAPACITY) expanded condom social marketing and voluntary counseling and testing, trained providers in anti-retroviral therapy, and helped develop protocols for patients dually infected with HIV and TB. Two pilot sites were selected for the Prevention of Maternal to Child Transmission (PMTCT) Project, and six Uzbek policymakers received USAID-funded PMTCT training in the Ukraine. The USG-funded Drug Demand Reduction Program (DDRP) broadcasted a documentary film on drug use and HIV/AIDS; opened a center in Samarkand targeting young people at-risk of injecting drugs; developed the region's first drug use prevention curriculum for secondary schools; assisted drug demand reduction activities in prisons; and awarded small grants for drug rehabilitation services. USG-funded NGOs reached Afghan refugees, 1,500 migrants, and almost 3,000 street kids. Both the national HIV/AIDS program and the World Bank adopted DDRP's anonymous tracking system for users of the program's services.

In 2005, a larger share of health expenditures went to primary health care (PHC), more people were served by clinics meeting quality standards, and Uzbekistan began rolling out the USG's model of PHC reform with funding from the World Bank and Asian Development Bank. The USG helped develop evidence-based guidelines on hypertension, integrated management of childhood illnesses (IMCI), and anemia, as well as the national grade school health curriculum. Decreases in perinatal morbidity and mortality resulted from training by the USG's MCH Project, which also opened an adolescent reproductive health center and three schools for expectant parents and delivered humanitarian assistance shipments valued at $500,000. In 2005, the USG and the Israeli Foreign Ministry marked the completion of a joint five-year program, which trained 350 nurses in clinical skills, leadership, and decision-making. Approximately 215 undergraduate medical students were trained using a new health management curriculum developed with USG support, and the USG assisted the Ministry of Health (MOH) and Ministry of Education in starting a regional medical school accreditation database. The USG sponsored a second regional public health conference, which improved coordination between donor agencies and the MOH, allocation of resources for TB and HIV/AIDS programs, and support for work in prisons. A four-day conference brought together nearly 400 public health officials from all five Central Asian Republics to mark CDC's ten-year effort to modernize the region's epidemiological services. The USG and CDC also sponsored the region's first Bioethics Congress. Additionally, through its MCH Project, the USG wrote the MOH's infection prevention and antenatal care guidelines. A multi-agency group reached consensus on a national Reproductive Health Strategy, addressing such key issues as adolescent health, contraceptive security, sexually transmitted infections, and screening for breast and cervical cancer. CDC's work on international birth definitions, supported by the USG, has rescued 81 newborns that would have been pronounced dead under the old criteria.

In 2005, through its Basic Education Program, the USG successfully re-designed and piloted new teacher training modules. Although interactive teaching, promoted by the new modules, requires a significant change from the traditional teacher-centered training style, which emphasizes rote memorization and lecture, teachers in the target schools are enthusiastic about the new methods and have begun to implement them in the classroom. However, as the training rollout was scheduled for the fall of 2005, the target of 400 teachers trained was not met by the end of the fiscal year. In total, 180 teachers completed the full training course, while another 149 teachers were exposed to the training modules at the Central Teacher Training Institute.

In 2005, the USG continued to promote community participation in education through the establishment of 37 new Community Education Committees (CEC) and children's clubs at 37 schools. CECs successfully mobilized community resources to help disabled children by building ramps, assisting parents with transportation to the school, and procuring simple prosthetics. Since the start of the program, 65 children have been enrolled in mainstream schools with the help of the CECs. The USG supported 29 schools with small grants for infrastructure repair. The communities' contribution, in the form of unskilled labor, cash, and construction materials, averaged 36 percent of the project value, which is twice the level of 2004.

In 2005, the USG trained 240 administrators, exceeding the target by 32 percent. A new course for school directors on managing innovation was rolled out to 78 pilot schools and 65 schools not included in the pilot. At the policy level, the USG worked closely with the GOU on the introduction of a more efficient per-capita-based education finance pilot in Akkurgan, Tashkent Oblast. Training on the principles of per-capita financing and the basics of effective financial management was provided to the directors of all 50 schools in Akkurgan, as well as to 25 school accountants and 20 district education officials. To build ownership for the pilot, the USG facilitated a working group consisting of officials from the Ministry of Education and Ministry of Finance. The initial outcomes of this pilot will inform not only future USG activity in education finance, but also the activities of the World Bank's new education program, which is currently in the final design stage.

The USG promoted healthy lifestyles and children's' sports activities in 40 schools throughout the Fergana and Andijon regions. The schools benefited from weeklong camps, which combined seminars in health education with sports competitions and games. In 2005, technical assistance and training was provided to help teachers and child sports professionals to institutionalize school-community sports by organizing children's sports leagues.

MEASURES OF PROGRAM EFFECTIVENESS

In order to determine how U.S. Government assistance affects a country, U.S. embassies set targets for improvement called "performance indicators." Data for these indicators are collected by research institutes, embassies and international organizations. By examining data over time, U.S. policymakers better understand whether specific assistance programs are making their intended impact and, if necessary, how to adjust these programs to improve the impact.

Please find below two important indicators in the area of Social Reform and Humanitarian Assistance. In the charts, the "Baseline" refers to a starting point from which to measure progress or regression over time. The embassy and its partner organizations then agree on a "Target" figure that they hope to achieve as a result of U.S. assistance programs. The "Rank" figure is the resulting measurement. "CY" stands for "calendar year," or January 1 to December 31, while "FY" stands for "fiscal year," the period of the U.S. budget that runs from October 1 to September 30 of the following year.

Performance Indicator: Under 5 Mortality. Ratings are based on a scale from 1 to 5, with 5 representing the best score. The 2005 rank is based on 2004 data. Source: USAID "Monitoring Country Progress in Central and Eastern Europe & Eurasia," No. 9 (April 2005), drawing from World Bank, World Development Indicators 2004 (2004); UNICEF, Social Monitor 2004 (2004). Found online: www.usaid.gov/locations/europe_eurasia/country_progress/index.html.

The USG supports implementation of the WHO's Integrated Management of Childhood Illnesses (IMCI) and Safe Motherhood programs in six pilot areas of Surkhandaryo and Kashkadaryo provinces, as well as the Fergana Oblast. While these pilot programs have had a positive affects on health in those communities in areas such as post-partum complications and morbidity from diarrheal disease, they have not covered a wide enough population to change national level statistics.

Performance Indicator: Life Expectancy. Ratings are based on a scale from 1 to 5, with 5 representing the best score. The 2005 rank is based on 2004 data. Source: USAID "Monitoring Country Progress in Central and Eastern Europe & Eurasia," No. 9 (April 2005), drawing from World Bank, World Development Indicators 2004 (2004); UNICEF, Social Monitor 2004 (2004). Found online: www.usaid.gov/locations/europe_eurasia/country_progress/index.html.

The United States has provided assistance in areas that make a positive difference in people's health. In 2005, the USG assisted Uzbekistan's TB Control Program to reach 100 percent geographic coverage within the country and decrease TB mortality and incidence rates. USG assistance is helping Uzbekistan better understand and work to prevent the spread of HIV in the country, training heath care providers in the use of anti-retroviral therapy, and working to prevent the transmission of HIV from infected mothers to their unborn children. U.S. assistance has also helped to ensure that a larger number of people in Uzbekistan are served by medical clinics that meet quality health care standards. However, these efforts have not covered a wide enough population to change national level life expectancy statistics.

Security, Regional Stability and Law Enforcement

Uzbekistan faces significant security challenges. The potential for Islamic extremism and for acts of international terrorism remains significant and supporters of terrorist groups remain active in the region. Uzbekistan is a transit country for opiates originating in Afghanistan and narcotics precursor chemicals have traveled through Uzbekistan on their way to laboratories in Afghanistan and Pakistan. There is a growing market in Uzbekistan for a variety of narcotics and consequently a growing problem with drug addiction and the spread of HIV/AIDS. The GOU lacks the resources to effectively control its borders, leading to narcotics trafficking and increased threats of terrorist movement or weapons of mass destruction (WMD) proliferation. Remnants of the Soviet WMD and delivery system programs remain in Uzbekistan, which further raises proliferation concerns. The Uzbek criminal justice system is largely inherited from the Soviet Union and the judiciary is not independent. Corruption is rampant at all levels of the system, and the outcome of court cases is rarely in doubt. Prosecutors and law enforcement officials rely on coerced confessions, and conviction is typical even in the absence of any corroborating evidence.

In the past, U.S.-Uzbek cooperation in the security assistance areas has been satisfactory. However, the deterioration in the bilateral relationship following the "color revolutions" in Georgia, Ukraine, and Kyrgyz Republic, and the May 2005 events in Andijon, dramatically reduced cooperation in 2005. Efforts to help the GOU reform its legal system and increase professional capabilities and standards within its law enforcement and security apparatus have been stymied. Law enforcement and nonproliferation assistance programs continue, but at a slower pace and with increased difficulties in a number of areas.

U.S. ASSISTANCE PRIORITIES

FY 2005 USG security-related assistance is focused on supporting efforts to improve the GOU's counterproliferation capabilities, continued fostering of regional cooperation, and improving border security in order to reduce trafficking of illegal narcotics and other hazardous, illicit items across Uzbek borders. The USG provides training and security-related equipment to the GOU to ensure inter-operability and communications clarity between Uzbek agencies in the event of suspect material being located at one of the border crossings.

PROGRAM PERFORMANCE

In FY 2005, the GOU was not eligible for Foreign Military Financing (FMF) and International Military Education and Training (IMET) funding due to the Secretary of State's determination under the FY 2005 Foreign Operations Assistance Act. Department of Defense (DOD) Counter-Terrorism Fellowship (CTF) funds of $200,000 were used to continue two Uzbek military officers in military professional development training courses, part of a program which is a cornerstone of the Uzbek government's military transformation efforts. Additionally, two Uzbek military representatives attended the Civil Military Strategy for Internal Development course using CTF.

Prior year funds were used to send one Uzbek Air Force officer to attend pilot training under the United States Air Force's Aviation Leadership Program (ALP). This officer was the fourth from Uzbekistan to receive an ALP scholarship since 1998.

Twenty three Uzbek defense and security specialists participated in a wide range of resident and non-resident professional development courses and seminars at the U.S. Defense Department's George C. Marshall Center in Germany, including conferences on cyber security and economic dimensions of defense institution building. Many graduates of these programs are now holding positions of increased responsibility in the Uzbek Government, including the Deputy Minister of Defense for International Cooperation, the Commander of the Tashkent Military District, and Deputy Chief of Mission at the Uzbek Embassy in Washington.

The Uzbek Ministry of Defense participated in a limited military-to-military cooperation program that provided support to the Ministry's reform initiatives and increased its counter-terrorism capabilities. Cooperative Threat Reduction funds supported the participation of 41 Uzbek military officers and non-commissioned officers in a variety of subject matter expert exchanges and training exercises in the United States. Under the Partnership for Peace Program (PfP), USG Warsaw Initiative Funds supported the participation of over 62 Uzbek service members in a variety of exercises, seminars, and other PfP events.

DOD Humanitarian Assistance funds in the amount of $150,000 were used to renovate and refurbish an infant orphanage in the capital Tashkent. This project provided safe and clean areas for the children to bathe, play, sleep, have food prepared, have clothing and bedding laundered, and receive medical therapy.

The GOU agreed to eliminate its weapons-grade nuclear material following the collapse of the Soviet Union, but is still dealing with the legacy of its past: remnants of biological and chemical WMD and their delivery systems, as well as the potential proliferation of WMD expertise. USG assistance has allowed continued interoperability and strengthening of counter-terrorism capabilities between USG and Uzbek agencies. In 2005, the USG conducted numerous policy, assessment, and training events including: WMD Counter-proliferation Awareness training, International WMD Investigations training, and WMD Incidents at the Border training. Equipment provided for these training events included radiation pagers, intrusion detection devices, chemical and radiation detection and measurement devices, individual protective gear, decontamination equipment, and evidence collection kits. In connection with the Biological Weapons Proliferation Program (BWPP), the USG provided numerous pieces of equipment to various institutes in Tashkent and Samarkand including incinerators, generators, bio-safety vent hoods, and numerous other expendable items to assist in the safe and secure research of hazardous diseases. Additionally, laboratory renovation work has been completed at four epidemiological monitoring stations (EMS) facilities in Tashkent and work has begun on a fifth EMS in Samarkand. At each of these facilities, state of the art Epidemiological Diagnostic and casework equipment has been provided. The BWPP Central Reference Laboratory (CRL) will ultimately be connected to 13 separate EMS to assist in disease control and research. The decision on when to begin construction of the CRL has been deferred until the spring of 2006 after the completion of an overall BWPP program review. The end goal in constructing the CRL is the safe storage of, and work with, extremely infectious diseases. The BWPP program will be in place for a total of six years, with four years devoted to the construction of the new laboratories and storage facility and two years of follow up maintenance.

The Weapons of Mass Destruction - Proliferation Prevention Program (WMD-PPI) is in support of the Department of Energy's First Line of Defense project involving the placement of WMD Portal Monitoring (PM) systems at International Port of Entry checkpoints (vehicular, pedestrian, rail) along the border and at specific import locations within Uzbekistan. Communications upgrades are being made that will enhance the timely reporting of WMD incidents to the State Customs Committee and Border Guards National Headquarters in Tashkent. During 2005, 11 Increment-1 POE locations received PM equipment upgrades and work began on an additional eight Increment-2 POE's late in the year. Lastly, overall system communications upgrade work is on-going which will ultimately provide real-time communications alerts and reporting regarding WMD alerts.

Assessments and border visits conducted under the Export Control and Related Border Security (EXBS) Assistance Program have confirmed that EXBS equipment provided in prior years is being widely distributed and used by Uzbek officials and has played a key role in the interdiction of illicit materials. USG-funded training is also having positive impacts and significantly changing the way Uzbek border security officials perform their duties. The USG provided fifteen Customs officers intensive training on Product Acoustic Signature Systems that were turned over to State Customs Committee of Uzbekistan following the completion of the training. Thirty Border Guard and Customs Officers received maintenance training on night vision goggles provided in previous years, and sixteen Customs and Border Guard Officers were trained on border interdiction and radiation safety in Hidalgo, Texas in April 2005. The recent passage of the law "On Export Control" is a step forward in the GOU's efforts to observe their international obligations for the control of the proliferation of WMDs and related materials. EXBS and the Department of Commerce have provided training programs on munitions and dual-use materials covered under Uzbekistan's export control laws. In addition, EXBS Program and the Center for International Trade and Security at the University of Georgia conducted a US-Uzbekistan Legislative Exchange-Briefing in September 2005. Unfortunately, the GOU declined to participate in Anti-Corruption and Integrity Awareness training, a Department of Commerce-sponsored Export Control Workshop, and Commodity Identification Training.

Using FY 2002 funds, the USG provided two patrol boats to the Uzbek Government to patrol the Amu Darya River on the border between Uzbekistan and Afghanistan. The final delivery of the second of two Gyurza-Riverine Armored Patrol Boats, totaling $5.6 million, arrived in Termez in January 2005. The United States Department of Homeland Security (DHS), acting as the Executive Agent for the Department of State, is providing this assistance to the Republic of Uzbekistan under the Export Control and Related Border Security Aviation/Interdiction Program (AIP). The Committee for State Border Protection (KOGG) maritime units provides support for all riverine missions, including nonproliferation and combating drug trafficking missions. Helping the Uzbek Committee for State Border Protection maintain and enhance their patrol capabilities is critical to U.S. national security priorities in the region.

In FY 2005, the USG continued to conduct limited exchange programs on border control issues. Fourteen Uzbek Customs officials visited El Paso, Texas to observe operations on the U.S. Mexico border. The Uzbek officials visited all the border crossings in the El Paso area where they observed U.S. Customs narcotics detection equipment and inspection methods and exchanged information with U.S. counterparts. Feedback from participants has shown that they found the visit useful and have attempted to integrate procedures they observed in El Paso into Uzbek border operations.

In FY 2005, the Department of State's Diplomatic Security Service held several courses in conjunction with the Anti-Terrorist Assistance (ATA) program, including the ILEA Budapest courses on the "Combating Transnational Terrorism" and "Police Executive Roles in Combating Terrorism." Uzbek officials took part in both of these courses alongside Kyrgyz, Tajik, and Kazakh counterparts. ATA also provided training in the United States on post-blast investigations.

Although Uzbekistan has started to reform its criminal justice system in recent years. The system continues to be dominated by its Soviet history and continues to suffer from low salaries, insufficient training and equipment, and widespread corruption. Nevertheless, the GOU has taken some steps toward reform. In FY05 President Islam Karimov issued decrees transferring the authority to issue arrest warrants from the General Prosecutor to the courts, and to abolish imposition of the death penalty. Both decrees take effect in 2008. The U.S. Department of Justice, through its Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT) has been working with the GOU to institute basic changes to bring Uzbek's criminal procedure code into compliance with its obligations under international treaties to which it is a party. In FY05, OPDAT held a series of workshops designed to increase the professionalism of Uzbek prosecutors, and in conjunction with ABA/CCELI, OSCE, UNDP, and USAID, organized a conference on international best practices in pretrial detention for senior Uzbek law enforcement officials. The United Nations Office for Drug Control and Crime completed a USG-funded project to install a computer network to link all the central and regional offices of the Prosecutor. The U.S. Drug Enforcement Administration (DEA) and the Uzbek Ministry of Internal Affairs (MVD) have jointly established a counter-narcotics Sensitive Investigative Unit (SIU), which became operational in FY 2003 and was successfully continued in FY 2005. The DEA and the Uzbek Government worked with other Central Asian law enforcement agencies to promote regional coordination on counter-narcotics efforts. The DEA-sponsored SIU has conducted a number of counter-narcotics operations resulting in an increase in narcotics seizures and arrests since the unit was created.

MEASURES OF PROGRAM EFFECTIVENESS

In order to determine how U.S. Government assistance affects a country, U.S. embassies set targets for improvement called "performance indicators." Data for these indicators are collected by research institutes, embassies and international organizations. By examining data over time, U.S. policymakers better understand whether specific assistance programs are making their intended impact and, if necessary, how to adjust these programs to improve the impact.

Please find below two important indicators in the area of Security, Regional Stability and Law Enforcement. In the charts, the "Baseline" refers to a starting point from which to measure progress or regression over time. The embassy and its partner organizations then agree on a "Target" figure that they hope to achieve as a result of U.S. assistance programs. The "Rank" figure is the resulting measurement. "CY" stands for "calendar year," or January 1 to December 31, while "FY" stands for "fiscal year," the period of the U.S. budget that runs from October 1 to September 30 of the following year.

Performance Indicator: Global Trafficking in Persons Report Country Rankings. Tier 1 countries are those whose governments fully comply with the minimum standards of the Trafficking Victims Protection Act of 2000. Tier 2 countries are those whose governments do not fully comply with the Act's minimum standards but are making significant efforts to bring themselves into compliance with those standards. Tier 3 countries are those countries whose governments do not fully comply with the minimum standards and are not making significant efforts to do so. The 2005 rank is based on 2004 data. Source: U.S. State Department Global Trafficking in Persons Annual Report. Found online: www.state.gov/j/tip/rls/tiprpt/.

In FY 2005, U.S. assistance helped to streamline procedures for repatriating victims and training over 17,000 people on the dangers of trafficking-in-persons. The USG also sponsored a shelter for the victims of trafficking. However, the GOU made little progress on adopting comprehensive anti-trafficking legislation and no visible efforts took place in 2005 to increase criminal penalties on traffickers. An OSCE-sponsored working group on TIP issues has not been given legal status by the Government, and met only one time in 2005.

Performance Indicator: Corruption Perceptions Index. Measures how experts view the state of corruption in a country. The score relates to perceptions of the degree of corruption and ranges between 1 (highly clean) and 7 (highly corrupt). The 2005 rank is based on 2004 data. Source: Freedom House: Nations in Transit. Found online: www.freedomhouse.org/research/nattransit.htm.

Corruption remains endemic at all levels of Uzbek society; the GOU made little progress in correcting this situation in 2005. Bribery is an accepted practice and corrupt public officials have numerous opportunities to profit from their office. Prior to the May events in Andijon, the GOU had expressed an interest in offers of anti-corruption training and other assistance from ABA/CEELI and DOJ. Following Andijon, however, the GOU prevented an ABA-sponsored conference on public corruption in Uzbekistan from taking place.

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