Infant Industry Argument: Theory and Practice
Infant
Industry Argument: Theory and Practice
An
Independent Study by Mamurjon Rahimov
The
University of Illinois at Chicago - 2004
Introduction
First of all, it was very hard to
choose a topic for the independent study. The idea of researching the argument
of infant industry protection came to me suddenly after reviewing a list of
topics in one economics class. From my several years of experience working in
the major infant industry of Uzbekistan – the Uzbek automotive industry, I
learnt how problematic the argument on infant industries was. There are no
clear guidelines, accepted practices, limitations, and the like, despite the fact
that infant industries persist all over the world, especially in Less Developed
Countries (LDCs). I started my independent study with a hope that I would
learn more about this topic to apply it when I go back to my country, and that
my experience would allow me better understand the theory. The argument of
infant industries remains to be a controversial topic in the world economy.
The fact that it is not well defined further exacerbates the problems caused by
its application. Infant industry argument remains to be one of the major
reasons for justifying protectionism in various forms. Although protectionist
measures such as tariffs, quotas, multinational agreements are imposed due to
various reasons.
It is very important for me to
learn pros and cons of this argument, now and here – since scientific
literature is one of the strongly censored aspects of life in Uzbekistan. In
fact, I never saw any mentioning that Uzbek auto industry was an infant
industry. Moreover, I never read any local article mentioning problems and/or
losses of the Uzbek auto industry. Even the export revenues of the company
were often calculated on the basis of shipments made out of the country, even
though these “shipments” did not sell for several years. When I got started
working with the Uzbek automotive industry, I was a new graduate from a
prestigious American business school, and all excited about the opportunity to
apply the knowledge that I acquired overseas, as well as to learn new things.
I met all kinds of people - those who did not know where the industry was
going; foreigners who tried to take advantage of our ignorance, and smart
people who were never allowed in decision-making. I read about infant
industries while in business school, and at that time, everything seemed
logical and simple.
. In my discussions of this topic
with leading managers, industry ministers, and PhDs in Uzbekistan (especially
those working directly in the management of this venture), I felt that I lacked
theoretical and empirical knowledge to base my arguments. All of those
managers, ministers, PhDs have background in the old socialist economy, so
often neither I nor them learnt something useful after long and intense
discussions. I remember the excitement of my department general manager when I
brought a Harvard Business case on The Uzbek auto industry with me from the
United States (actually, while studying in the USA, I went to a graduate level
class with a permission from a professor to participate in its discussion). He
immediately got several photocopies of the case and passed on to the higher
echelons of the management. I doubt that they learnt anything useful from it
(business cases generally do not criticize or approve certain policy), but the
very fact that they were eager to get to know what Americans think about them
was very interesting. Hence, they might heed if someone who was well aware of
the infant industry argument advised them.
Our marketing department, in which
I was an assistant manager, did not receive funds for basic market research,
let alone for scientific, comparative-empirical work. We could not buy books,
attend seminars, and subscribe to industry magazines, purchase software and
databases. I knew we should learn from other countries’ experience, i.e. we do
not need to repeat other people’s mistakes. I felt that Uzbek automotive
industry could learn from automotive industries of Korea, Malaysia and other
developing countries. I say developing countries, because developed countries
are far ahead of us (LDCs), and at the time they fought with problems similar
to ours, they faced a completely different set of conditions. Developing
countries, however, started quite recently from scratch and achieved
considerable results, faced similar problems, came up with their solutions.
One representative of the French
automotive group CITROEN asked the general director Kayumov of Uz-DAEWOO Co.,
the flagship of the Uzbek auto industry, the following question: “Why do you
subsidize Russian consumers by selling your cars below cost? ”
An American entrepreneur, who
preferred to remain anonymous, said that Uzbek top management in the automotive
industry acting “penny wise, and pound foolish”. I am sure he was referring
the special interest groups that were benefiting from adverse situation of the
Uzbek automotive industry under protections. In another account, Russian
dealers who sold Uzbek-made cars were stunned when some insider information had
been revealed to them at a closed meeting between Uzbek auto manufacturers and
Russian dealers from all over the Russian Federation. In other words, a lot of
things went wrong. There was a whole contingent of problems contributing
towards undesired outcomes from Uzbek infant industry protection, but I believe
that the bottom line was misunderstanding and abuse of the infant industry
argument.
Background Problem
Uzbekistan, from the very beginning
of its independence claimed it had its own way of economic development. This
method was even given a name “Uzbek Method” (Karimov, 2000). Nowhere in this
method, it says, “do not learn from others”. On the other hand, it also does
not state that learning from other developing countries is the key factor in
our success.
When the “UzAUTOSANOAT”, the
association of automotive industry of Uzbekistan acting on behalf of the
government of Uzbekistan, and Korean automotive company DAEWOO signed agreement
to produce light cars in 1992, Uzbek government guaranteed protection for the
new joint venture until the year 2000 (Quelch, 1997). The year 2000 came, and
nothing happened. The industry continued to receive subsidies from the
government in the form of state guarantees for loans received from foreign
export-import banks, as well as continued tariff/non-tariff barriers. Meanwhile
DAEWOO Corporation went bankrupt and most of its assets went for sale. Russian
financial crises hit hard the economies of the former Soviet republics. All
these things served as an excuse for the Uzbek automotive industry’s failures.
According some estimates of industry insiders, the Uzbek automotive industry
lost around U$ 150 million annually. That is almost the amount equal to the
cost of the industry’s flagship automotive plant in Ferghana valley, which is
capable of producing 200,000 vehicles every year. In fact, that kind of scale
of production was never reached; and the largest volume of production was
around 75,000 at one time.
Another barrier to rapid
development of automotive industry, and the whole economy of Uzbekistan is
often cited to be high transportation costs. Uzbekistan is, in fact, the
world's only double landlocked country, i.e. it is the only country whose all
neighbors are landlocked, so to reach any seaway you have to cross two
international borders. It is very disadvantageous to be landlocked: other
types of transportation are still extraordinarily high. However, having worked
in the industry for almost three years, I was a witness how the automotive
industry could not work properly and was losing millions of dollars within its
domestic market, let alone the neighboring markets.
In the course of my research, I
came across various opinions on the infant industry argument. I divide them
into two broad categories. The first category approaches to the concept of
protectionism from theoretical point of view, using various models and graphs
(Magee, 1972). The other category scholars approach to the concept in the
light of the economic history (Chang, 2002). Among both categories I found
some that support protectionism, and some that oppose to it. Moreover, certain
economists believe that the concept of protectionism is obsolete and no more
effective in the modern world economy, whereas some other economists believe
that the concept is not only applicable but also especially promising during
the fast paced technological and economic change of the modern era - if
correctly understood and applied (Shafaeddin, 2000). Yet there is another
category of economists that do not support tariff and non-tariff barriers, but
advise to use more direct measures in assisting infant industries. Governments
around the world justified and continue justifying their protectionist
measures, claiming that these measures, at least in the long run, benefit their
countries' employment level, infant industries, balance of payments, and the
like. Sometimes two or several of these benefits are cited by governments to
be grounds for active government involvement in the economy not only through
protectionism but also export promotion. From my point of view, infant
industry argument comprises in itself all other arguments for protectionism.
Infant Industry Argument:
Background
The World Trade Organization
officially recognizes infant industries as a legitimate reason for trade
restriction, although it encourages member countries and applicants to end
these practices. Numerous trade policy reviews posted on the WTO website shows
this attitude of WTO (wto.org, country by country trade policy reviews). It
turns out that the argument of infant industries dates back to late 18th
century. It was first proposed in 1792 by Alexander Hamilton. At that time,
the newly established industries in America were not competitive with those of
Europe. European manufacturers were highly organized with supply and distribution
systems already in place. Hamilton's argument was that these "infant
industries " should be given some time and protection in the form of
subsidies, tariff and non-tariff barriers - until they become competitive
(Suranovic, 1997). Another well-known economist, Friedrich List, also argued
about appropriateness of protectionism. It is necessary to mention that List,
who lived in the United States of America in the beginning of 19th century, was
strongly influenced by works of Hamilton. The United States, which is
currently pushing throughout the world the concept of globalization via free
trade, was the place where the infant industry protection was in, in fact,
extensively used in order to be able to compete with the rest of the world,
especially, its former sovereign (Shafaeddin, 2000). List criticized works of
Adam Smith in that they inefficiently highlight the importance of protection
for infant industries. However, List did acknowledge the drawbacks of tariffs,
and stated that, "in time, these industries should be able to compete with
foreign competition successfully. The policy of protection should, however
should continue to ensure the further expansion of the country's
industries" (Shafaeddin, 2000). List wrote that protection should be selective:
“At first – for the reasons we have mentioned- it should attempt to stimulate
only those industries which have an assured home market and appear to have the
best chance of success.” (List, 1837)
Adam Smith dismissed the infant
industry argument stating that, "Just because a country could acquire an
industry by means of such protection did not imply it should do so, or that the
country would be better off for having done so"(Smith, 1776).
Nevertheless, Smith recognized that in certain cases, protectionist measures
are necessary. For instance, he supports the Act of Navigation that at that
time gave the shipping industry of the Great Britain almost exclusive rights to
transport inbound and outbound goods (p.429). Smith went even further in
discussing the topic of defending domestic industry (the term “infant industry”
was not used by Smith in his Wealth of Nations), and asked about appropriate
duration of such protectionist measures: “As there are two cases in which it
will generally be advantageous to lay some burden upon foreign, for
encouragement of domestic industry; so there are two others in which it may
sometimes a matter of deliberation; in the one, how far it is proper to
continue the free importation of certain foreign goods; and in the other, how
far, or in what manner, it may be proper to restore that free importation after
it has been for some time interrupted.” The second case, which is of interest
hereby, described as “…when particular manufactures, by means of high duties or
prohibition upon all foreign goods (sanctions? m.r.) which can come into
competition with them, have been so far extended as to employ a great multitude
of hands Humanity in this case require that the freedom of trade should be
restored only by slow gradations…” (p.435)
Thus the argument has a long
tradition in the economic history. Numerous scholars since the beginning
attempted to shed light into the nature of the infant industry argument. H. G.
Johnson’s description of the argument is especially clear: “What is involved is
an investment in a process of acquisition of knowledge which is socially
profitable but privately unprofitable because the private investor cannot
appropriate the whole of the social return from his investment. ” The crucial
gain from infant industry protection is thus the appropriation of knowledge
that is privately unappropriable in its entirety or in some part (Stern,
1973).
David Landes mentioned
protectionist measures exercised by various countries throughout the history.
His work has shown that such measures were often undertaken not for the sake of
the infant or strategic industry itself (I believe, these two things means the
same. mr), but for political ambitions of the ruling class. He writes: “
Direct subsidies and aids are only part of the story. The state’s hand lay
everywhere, even where not directly manifest. Even in Britain, government
supported and protected overseas trade: the country as a whole paid the
associated security costs of private venturers and adventures in distant seas.
Such indirect subsidy, easy to overlook, was crucial.” (Landes, 1999)
Although developed countries have
abolished or drastically decreased the level of the most of their protectionist
measures, it is noted that they should play major role in spreading the word
and action on gradual removal of such barriers to free trade and its benefits.
OECD Trade Committee recommends that developed countries, OECD countries in
particular, should procure technical assistance to the Newly Independent States
(NIS) in reducing existing tariff and non-tariff barriers. It is important to
note that OECD countries need to work with NIS in developing proper policies
for reduction of protections, since OECD countries doubtlessly have much
experience, strong institutions to cope with the myriad of questions and
challenges arising from the implementation of such policies. On the other
hand, OECD countries also have numerous tariff and non-tariff barriers that
inhibit NIS in trading with them. Reducing, removing and when necessary,
educating producers from NIS in complying to these regulations would in turn
make it easier for NIS countries to speed up the process of abolishing their own
protectionist measures. Since most of the persisting tariff and non-tariff
barriers in the OECD countries are concentrated in "sensitive"
sectors such as agriculture, iron and steel, textiles and apparel, their
gradual removal or reduction would make products and services from NIS services
more competitive and thus would make protectionist measures unnecessary (OECD,
1994). In case of Uzbek auto industry, such non-tariff barriers in developed
countries accounted for a lot of problems with export plans. For instance,
vehicles to be sold in Germany had to undergo homologation, a special technical
evaluation, and Uzbek automotive representatives were bogged down in
paperwork.
Again, although developed countries
strongly push free trade, and try to abolish protectionism worldwide, they
often retreat and use protectionist measures themselves at home, often when
they hit recession. For instance, more recently, talk of “free trade” in the
United States gave way to the “fair” trade. Fair trade refers to unilateral
rules of what is permissible and what is not. (Salvatore, 1993). This implies
that infant industry argument can also be quite legitimately used in various
cases. The United States continues to protect quite “mature” products and “mature”
industries, such as textiles, automobiles, and etc. Although OECD countries
tried floating exchange rates, they did not always work as well as good old
protectionist measures. I do not know if Uzbekistan learnt from the experience
of the developed countries or not, but inconvertibility of the national
currency SOUM hurt the economy real bad, while somehow boosting domestic sales
of the Uzbek automotive industry.
Costs of protectionism were
estimated in a number of studies. These costs include not only direct costs
such as increased prices, but also numerous indirect costs such as lost jobs,
freedom of choice, reduced quality. It is estimated that protectionism
destroys (also, prevents the emergence of) more jobs than it induces. Quality
might also decline, if better quality products become scarce or unobtainable
due to the protectionist measures. Administrative costs of protectionism
(which are paid for by taxpayers and consumers) are another major issue. The
costs of protectionist measures can be further divided into two parts: monetary
costs and non-monetary costs. Numerous studies have estimated monetary costs
of protectionism for various cases. A Brookings Institution study came up with
an estimate for costs for US consumers caused by "voluntary" export
restrictions on automobiles in mid-1980s: $14 billion. Estimated foreign
deadweight loss was around $3 billion - i.e. although foreign automobile
manufacturers could increase prices due to the tariffs, they certainly would be
able to sell less than before. According to another study, in the rubber
footwear industry, it cost $30,000 a year to save a job that pays only $11,460
a year, based on 2,000 hour work year (McGee, 1996). Besides such costs, there
are side effects of infant industry protection, and one of the most recurring
is retaliatory action by other countries that may be adversely affected by
protectionist measures. Smuggling at different levels is also one of the evils
caused by protectionism. Researchers have increasingly studied the cost of these
and other costs in comparison to the benefits that might be realized by partial
or complete removal of tariffs and the like. Although approaches and models,
as well assumptions of these estimations varied from study to study, one of the
prevalent common methods was the estimation of the deadweight losses resulting
from such protectionist measures (Stern, 1973). However, these estimations are
by far not accurate in calculating real costs in industries that have effect on
numerous other areas of economy; and because of the very fact that the graphs
drawn with supply and demand, tariff and resulting deadweight loss are correct
if ceteris paribus (which is never the case). I should mention here that Uzbek
government chose to invest into automotive industry hoping that flourishing
automotive industry would trigger economy wide renaissance (Quelch, 1997).
Then the opposite must be true also. Who estimates that?
It is true that protectionism
directly and indirectly effects the allocation of resources in the country.
During the course of history of protectionism, optimal allocation of resources
has always been a problem. Researchers showed that objectives of protectionism
in several countries could have been achieved with less sacrifices. Not only
that, but much higher gains could have been realized both qualitatively and
quantitatively. Import substitution was another reason to protect and nurture
infant industries. ICOR estimate was used as criterion, i.e. invest and
protect industries where ICOR was smallest. Effective rates of protection
(ERP) began to be calculated in the late 1960s. However, the role of ERPs
remains ambiguous. Tariffs were supplemented by numerous quantitative and
direct controls of foreign exchange. Exchange rates were another widely used
policy tool - widespread overvaluation of domestic currency was used to keep
domestic price of capital low. Policies designed to increase the rate of
capital formation backfired in some cases, and caused underutilization of
existing capital. Agriculture, the largest sector in most LDCs was expected to
decline over time in relative terms. Countries seemingly did not realize that
a sluggish agricultural sector would eventually penalize protected industries.
When new manufacturing sectors could not meet their export plans, and turned
towards their domestic market, the market could not absorb the products due to
the fact that deteriorated economic situation in the agriculture already had
shown its effect on consumers' pocket. Due to the limited ability of the
government to plan, administer, and control sensible plans, often the
government was part of the problem rather than part of the solution. However,
it is essential to note that government learning from its mistakes and those of
others, not government minimizing, is the object. Eventually some countries
started to move away from import substitution towards outward orientation,
which was closer to free trade than import substitution. That may be a major
reason for outward orientation still being urged strongly in developing
countries by powerful institutions and influential persons. It is true that
after world war protectionism was widespread and several economic
"tigers" emerged around the world. Whereas some economists argue that
protectionism played important role in the post-war period, others say that
"association" is not necessarily "causation" (Bruton,
1998).
Among the experience of development
of all countries in the past century, Korean experience is one of a kind.
Economists have been admiring at the quick development of Korea through
industrializing its economy, which certainly had most elements of
protectionism. However, unlike many other governments, Korean government was
relatively quick at learning from its own mistakes and those of other
countries. For instance, the government used direct subsidies to channel
finances to the traded good sector, instead of staying with tariffs. Korea's
outward orientation is commonly singled out as the key to its success, whereas
positive world economic environment was also a key element for success. Since
the ultimate goal of any economic policy is development of the country, Koreans
approached this challenge wholeheartedly. Education was emphasized, as well as
discipline towards work. When excessive government intervention in allocating
resources started causing problems, the government was willing to relax some of
its controls over the economy. Relatively large domestic market was also
beneficial for its economic policies. Korea's growth pattern and its
comparison with other countries implies how similar measures could produce
various outcomes depending on numerous variables such as unemployment level,
structure of the economy, elasticity of supply and demand in various sectors of
the economy, timing of various policies, education level of the workforce, and
etc (Dornbusch, 1987).
Scholars and researchers often put
import substitution and export promotion (both of which, in fact, could be used
to support infant industries) on two opposite sides. The concept of learning
curve, or learning-by-doing economies of scale as some state, enforces validity
of the infant industry-argument. Market imperfections are also often cited to
be another reason for protectionist behavior of some countries. (Panagariya,
1999). In some country cases, government policy towards protecting infant
industry through import-substitution shifted towards export promotion
(Dornbusch, 1987).
Some researcher strongly believe
that imposition of free trade towards LDCs by developed countries such as the
USA, western European countries, and UK has produced discouraging results.
LDCs developed much faster before they abandoned protectionist policies and
followed the IMF, World Bank, and Western think-tanks that vehemently push free
trade. One of the researchers who reached the above conclusion is Ha-Joon
Chang, a professor of economics at Cambridge University, and the author of
numerous books on this topic such as “Kicking Away the Ladder: Development
Strategy in Historical Perspective”, London, 2002. This metaphorical title
comes from Friedrich List, which wrote in 1841: “It is very common device that
when anyone has attained the summit of greatness, he kicks away the ladder by
which he has climbed up, in order to deprive others of the means of climbing up
after him…” He blames that developed countries such as the USA, Germany, and
UK have passed the period of protectionism of their own, and do not want LDCs
to catch-up using the same methods. In other words, Chang believes that
developed countries are engaging in “Do as we say, not as we did” behavior. “When
they were in catching-up positions, the NDCs (now-developed countries)
protected infant industries, poached skilled workers, and smuggled contraband
machines from more developed countries, engaged in industrial espionage, and
willfully violated patents and trademarks,” says Chang. “However, once they
joined the league of the most developed nations, they began to advocate free
trade and prevent the outflow of skilled workers and technologies; they also
became strong protectors of patents and trademarks. In this way, the poachers
appear to have turned gamekeepers with disturbing regularity.” (Lind, 2002)
Concluding remarks and suggestions
I started out with the hope to find
out more about the infant auto industry of Uzbekistan, but the lack of reliable
data was a huge barrier. The official web sites of both Uz-DAEWOO and Uzbek
Ministry of Macroeconomics and Statistics have been dysfunctional. Not that
Uzbek officials underestimate the importance of disseminating economic
information to attract direct foreign investment, but they are reluctant to
divulge many statistics. Moreover, even the web cites of an Uzbek think-tank,
Center for Economic Research, set up by UNDP was not any useful in backing up
the research with facts. Knowing that DAEWOO was the largest foreign investor
into Uzbek economy, one might ask, why is it impossible to find any articles in
the archives of a UNDP-supported think-tank? The fact remains that the lack of
reliable information has been one of the main phenomenon in LDCS, and
Uzbekistan is not an exception. Therefore, I had to include much from what I
learnt personally during almost two and a half years of work with the Uzbek
automotive industry and my personal conversations (should I call “interviews”
of top industry insiders?).
The fact that I have worked in a
major infant industry of Uzbekistan for several years, close to the decision
making headquarters, has helped me to better understand the literature on this
topic, whereas my access to various economic literature, web sites gave me a
lot of theoretical basis for analysis. While working in the automotive
industry, I attended several corporate meetings and seminars, which were closed
for media and outsiders. Also, I had personal encounters with the top
decision-making people of the industry. Hence, I also have my own way of
thinking about this topic, based on my personal experience.
Nowhere in the textbooks, nor in professional
literature, one can see some optimal period that should be given for infant
industry to grow up. That in turn implies that those who run the country can
extend infant industry protection indefinitely, trying to make some profit out
of complex deals. This is especially true about LDCs, where government is free
to do practically anything regardless of the public discontent. LDCs lack
strong and free media, economic and political think-tanks to shed light on
problems, chaos, and anarchy in the economy. Besides, many of the LDCs are
from former socialistic block, which did not have things like competition at
all. Thus, complete protection of one or several industries seems
"normal" to almost everyone.
International agencies and
organizations such WTO, IMF, World Bank, and many others can criticize as much
as they want, and foreign economists in leading educational and research
institutions can write up many critical reports and business cases - but until
the people in those LDCs, especially people in decision-making positions,
understand that things are going wrong and the infant industry is not growing
up "healthy" - certain economic and political forces in LDCs are
going to continue to abuse this concept and continue to make it work for their
narrow benefits. In other words, I believe in the “inside out” kind of change.
Of course, as it had happened
numerous times with numerous countries, Uzbekistan in particular, international
agencies may exert pressure on governments to change, to accelerate transition
to free market system. However, we have seen how ignorant governments react to
this: simply make up statistics that leave western analysts and international
aid and trade agencies happy with the situation. In case of Uzbekistan, this
caused several international agencies, such as IMF and WTO, to stop receiving
statistical information from the Ministry of Macroeconomic Statistics of
Uzbekistan.
I was surprised not to find any
notion of implicit government guarantees, formally and/or informally given to
support infant-industries. In other words, Uzbek government’s clout always has
been by itself a guarantee while its pampered infant industry was borrowing
from foreign financial institutions. In the case of Uzbekistan, surprisingly,
I saw the combination of almost all protectionist measures (that I found in the
literature on this topic) being used almost simultaneously. It seems to me
that the Uzbek Government was trying, by all means possible, make sure the new
automotive industry did not fail. Sadly, the venture brought nothing but
losses so far. As an insider, I estimated these losses were several hundred
million US dollars per year. I cannot even guess how these losses caused “domino
effect” in all other fields of the Uzbek economy. The information about the
continuing losses of the Uzbek auto industry is so classified that even there
was no mention of it neither in official nor unofficial media. Meanwhile, huge
funds are being channeled to this venture in hopes to preserve it, plus protectionist
measures are also showing their negative effect. Informed people that I spoke
with believe that these losses are continuing to be incurred only due to the
political reputation of the current President of Uzbekistan.
I personally support the infant
industry argument as a temporary means towards economic development. I think
that it is time to draw, at least, general guidelines for protection of infant
industries - since the world had had over 200 years of experience on this
matter. In my view this should be carried out on the level of WTO. Since the
practice of protecting infant industries is still prevalent in the modern world
economy and is costing the world economy astronomic figures, this matter
deserves formation of a separate committee or group of practitioners and
scholars under the auspices of WTO. Protectionist policies should allow for
quick and decisive changes, when circumstances require. In other words,
instead of developing one rigid 10-year plan for development of particular industry's
potential, a series of smaller steps with various specific conditions could be
devised. For instance, a government could tell the infant industry to achieve
ten percent decrease in manufacturing and administrative costs within the next
three years, or achieve certain ROI (return on investment) in order to qualify
for further tax holidays and/or subsidies. This would, in my view, compensate
for the lack of competition for the infant industries. Governments should play
the most active role in nurturing the strategic and long-term goals, which of
course will cost some sacrifices. I have met a number of businessmen from
now-developed countries that did not regret that at one period of their lives
they had to give up their economic freedom and well-being so that to provide a
prosperous future for the next generations. However, it must be emphasized
that such losses have to be forecasted before they occur - in order to
undertake necessary measures to minimize them. After all, no pain, no gain…
I intend to go back after
graduation, and I will see the people that I worked with. Uzbeks generally
fear authority, and do not talk what they know straight to the face of someone
one level higher. Here, in the USA, despite the far distance from home, I have
made good friends among a number of Uzbek and other economists. We organized
discussion groups and brought up many issues, including the Automotive industry
of Uzbekistan. We have our own views, much different than that of current
policy makers. Most of the scholars from Uzbekistan who study abroad came
through the President’s Program “UMID” (translated as hope), and our nation has
placed their hope on us to deal with social, political, and economical problems
of our newly independent motherland. I would be very happy, and I am very
hopeful, that with works like these we moved one step closer towards more
developed Uzbekistan.
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