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RR RUEHAG RUEHAST RUEHBI RUEHCI RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK
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DE RUEHNT #1547 2921040
ZNR UUUUU ZZH
R 191040Z OCT 09
FM AMEMBASSY TASHKENT
TO RUEHC/SECSTATE WASHDC 1432
INFO ALL SOUTH AND CENTRAL ASIA COLLECTIVE
EUROPEAN POLITICAL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 0095

UNCLAS TASHKENT 001547 
 
SIPDIS 
AMEMBASSY ANKARA FOR AG COUNSELOR 
 
E.O. 12958: N/A 
TAGS: ECON SOCI UZ
SUBJECT: BUSINESS AS USUAL AT UZBEK COTTON FAIR 
 
¶1. (SBU) SUMMARY. The Fifth International Uzbek Cotton Fair took 
place in Tashkent on October 14-15, 2009. This event showcased 
Uzbekistan as a leading producer and exporter of quality cotton and 
highlighted recent efforts by the Government of Uzbekistan to 
strengthen its internal textile industry. Notable was the absence 
of any concern by buyers over the boycott of Uzbek cotton by 
American and European customers because of child labor concerns. 
The Dubai Cotton Center also had a strong presence at the 
conference as it seeks to increase its role in the Central Asian 
cotton supply chain. END SUMMARY. 
 
 
 
¶2. (U) Uzbekistan, the world's third largest exporter and sixth 
largest producer of cotton, hosted its Fifth International Uzbek 
Cotton Fair in Tashkent from October 14 through 15. The fair is an 
annual event organized by the Uzbek Ministry for Foreign Economic 
Relations Investment and Trade (MFERIT) for representatives of 
cotton companies to learn qualitative characteristics of Uzbek 
cotton and negotiate for its export. Uzbekistan is one of the few 
countries that continues to sponsor an actual fair for cotton 
sales; other countries rely solely on world commodity exchanges to 
facilitate sales. Despite a worldwide decline in cotton demand for 
the 09/10 season, attendance was level with last year. Some 300 
companies and 500 industry representatives from 34 countries 
attended the various events. 
 
 
 
¶3. (U) First Deputy Prime Minister Rustam Azimov opened the 
conference, placing great emphasis on increased Asian demand for 
Uzbek cotton and the Government of Uzbekistan's (GOU) goal of 
becoming a textile power in the region. Uzbekistan is currently a 
major supplier to Asia, accounting for 60% of cotton imports by 
Bangladesh and for about 10% of imports by China (Mainland). Azimov 
exuded confidence in Uzbekistan's overall economy and the cotton 
industry, despite the recent world financial crisis and falling 
cotton demand. Azimov announced that Uzbekistan's Gross Domestic 
Product (GDP) increased by eight percent for the nine month period 
ending September 2009. Industrial output increased by 9.1% during 
the same period while total fixed capital investment climbed up by 
28%. Uzbekistan's foreign trade came to 2.3 billion rubles. 
 
 
 
¶4. (U) Azimov also reiterated the GOU's commitment to improving its 
textile industry through investments in ginning capacity, 
transportation infrastructure, scientific research into seed 
quality, and foreign joint ventures. Azimov announced that domestic 
cotton consumption for 2009 will reach 300,000 tons, up from 
250,000 tons in 2008. This increase is smaller than previously 
expected by the GOU, which had sought to increase the 2009 volume 
of domestic consumption as much as 50% through modernization and 
technical improvement of existing enterprises. 
 
 
 
¶5. (U) Director Ramaurthui of the Dubai Cotton Center (DCC) updated 
the attendees on the successful export of 20,000 tons of Uzbek 
cotton through its exchange and storage facilities. Currently, most 
Uzbek cotton is transported by buyers via rail to the Iranian port 
of Bandar Abbas. At last year's fair, the DCC, a trading arm and a 
fully-owned subsidiary of the Dubai Multi Commodities Centre 
(DMCC), signed an import memorandum of understanding with 
Uzprommashimpeks (UPM), one of the three cotton exporters under 
MERFIT, to act as a redistribution center and trading post for 
cotton from Uzbekistan en route to Asia. The DCC began operations 
in April 2009 and now has capacity to handle 200,000 tons per year. 
 
 
 
¶6. (SBU) International concern about the Uzbek use of child labor 
in the cotton industry appears to have had little impact on fair 
attendees. There was no talk of boycotts by European and Western 
firms, and negotiations seemed brisk. Terry Townsend, Executive 
Director of the International Cotton Advisory Committee, later 
shared with Ambassador Norland that child labor concerns were "not 
even discussed in a whisper over coffee." Most attendees were 
asleep before protests against the use of child labor started in 
front of the Uzbek Embassy in Washington DC on October 14. 
BUTCHER