Uzbekistan and Kazakhstan discussed the creation of a joint company to verify the integrity of counterparties.

Uzbekistan and Kazakhstan are considering establishing a joint venture to assess counterparty reliability.

Tashkent, Uzbekistan (UzDaily.uz) —

At the Uzbek-Kazakh business forum in Tashkent, a proposal was put forward to establish a joint Uzbek-Kazakh company to assess counterparty reliability for factoring purposes in mutual trade.

**Problem: Factoring is constrained by a lack of counterparty data**

Davron Vakhabov, head of the Chamber of Commerce and Industry of Uzbekistan, raised the issue of the lack of a factoring mechanism in mutual trade between the two countries.

"If a company wants to export its products now, time is wasted while a bank in that country conducts background checks on the entrepreneur and determines whether factoring can be granted or not," he noted, adding that he had discussed this issue with Timur Ishmetov, Chairman of the Central Bank of Uzbekistan. He added that the idea of creating a list of reliable counterparties in both countries at the level of an intergovernmental commission is being considered.

Kanat Sharlapayev, Chairman of the Presidium of the National Chamber of Entrepreneurs of Kazakhstan "Atameken," supported the proposal.

"This is a very good proposal. The problem of mutual settlements exists not only between Uzbekistan and Kazakhstan—it significantly hinders trade growth," he said, adding that similar difficulties arise in the markets of Afghanistan and the Middle East, where the parties plan to jointly enter.

Vakhabov also reported that a document is being developed in Uzbekistan under which an Uzbek bank will provide factoring to exporters, with a portion of the interest rate subsidized by the state. It has been proposed to test the mechanism on 50 companies supplying wheat as a pilot project.

**Kompra Experience**

A possible solution to the problem emerged after a speech by Gaukhar Baltabayeva, CEO of the Kazakh holding company Kompra (part of the Dream Group). The company ranks first in Kazakhstan for IT solutions development and among the top five in Central Asia, with its products available in 11 countries.

According to Baltabaeva, Kompra integrates open and government data sources, allowing businesses and banks in Kazakhstan to make decisions on lending and working with counterparties in seconds.

"We conduct audits not only of Kazakhstani companies, but also of all foreign companies with which our entrepreneurs work in Kazakhstan, including Uzbek ones. Last year, we conducted over 200 audits specifically on these companies," she said, noting that Kazakhstan's largest banks use these data to make lending decisions.

**Proposal from the Uzbek side**

The idea for a joint project based on this experience was voiced by entrepreneur Fakhriddin Ilyasov, co-founder of Marafon Group (Fergana) and member of the Council under the President of the Republic of Uzbekistan.

"Gaukhar knows who can [factor] and who can't. We'd like to create a similar portal in Uzbekistan about counterparty integrity. Let's create a joint company and then sell it jointly to an Uzbek-Kazakh fund—to decide who can factor," he proposed.

Vakhabov supported the initiative on the spot. "I thought about this too when we were discussing factoring. We agreed," he said.

The specific parameters and structure of the future company were not discussed at the forum; the parties agreed to continue negotiations as usual.