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For western brands, Uzbekistan’s cotton privatisation raises red flags

As Uzbekistan turns to privatisation to solve forced labour in the state-controlled cotton sector, an investigation into an international equipment contract raises red flags over business practices and government control.

For western brands, Uzbekistan’s cotton privatisation raises red flags
Published:
  • The systemic use of forced labour in Uzbekistan’s state-managed cotton sector saw the country blacklisted from lucrative western markets
  • In 2017, Uzbekistan’s government began a far-reaching privatisation programme designed to expand the garment sector, eradicate forced labour – and win back western brands
  • A cache of leaked records document irregular transactions between one of Uzbekistan’s largest textile firms, the Uztex group, Swiss multinational Rieter and a little known British trade agent
  • These records point to a wider problem: lax corporate practices in Uzbekistan, and the complicit role of western jurisdictions, will complicate the country’s re-integration into a global economy where there is growing demand for responsible sourcing

Since 2017, Uzbekistan has initiated one of the more ambitious privatisation efforts in its post-Soviet history, with the Central Asian republic’s state-managed cotton sector being rapidly handed over to local corporate operators and foreign investors.

It’s not just about the familiar economic and political questions large-scale privatisation provokes. Some hope it will help address the labour abuses that have tarnished Uzbekistan’s cotton sector. For years, children, public servants and even doctors have been forced into the cotton fields to meet targets in a key export area.

By taking the state’s authoritarian hand out of the cotton sector, and replacing it with private commerce, the Uzbek government expects that technological innovation will improve, value-added production in garments and textiles will expand, and ultimately the systemic abuse of labour will end.