UNESCO CHAIR WRITTEN WORK COMPETITION: IDEAS FOR A KNOWLEDGE ECONOMY

Authors: Lutfullo Akhmedov and Mashhura Rahmatullayeva

Programmes:

• Lutfullo Akhmedov — Economics with Data Science, Level 4

• Mashhura Rahmatullayeva — Economics with Finance, Level 4

Paper Title: Graduate Employability Crisis in Uzbekistan

Pathway: Human Capital and the Knowledge Workforce

This winning paper examines one of the most pressing questions for Uzbekistan’s knowledge economy: how to ensure that university graduates are equipped with the skills, experience, and opportunities required by a changing labour market. By focusing on graduate employability, the authors address the connection between education, human capital, workforce readiness, and long-term economic transformation.

Impact Statement:

Uzbekistan is self-educating at such a rate that the economy can not absorb it. The higher education institutions of the country produce over 170,000 graduates each year, the majority of which get degrees in engineering, economics, information technology, and the natural sciences (State Statistics Committee of the Republic of Uzbekistan, 2023). The tertiary education sector in the country has grown exponentially in the last ten years, by any criteria of enrolment or credential attainment. But the graduate unemployment rate remains at around 18 percent, and the proportion of formally employed in the knowledge-intensive job sector also is also one of the lowest in the Eurasian region (World Bank, 2023). The irony is not hidden: increasing education is making people less competent at least not so that a knowledge economy needs them.

This mismatch does not inconvenience. It threatens the development path of Uzbekistan on the structural level. The Uzbekistan 2030 strategy of government is categorical regarding the goal: to shift to an economy that relies on commodities, labour surplus, and instead serve high-value services and human capital. The strategies of human capital can be effective, however, only when the skills that are produced are matched with the capabilities, which productive, knowledge-intensive employment requires. Currently they no longer do. Graduates testify to putting their feet in the labour market without the analytical, digital, and applied technical skills that employers in growth industries finance, software, advanced manufacturing, agribusiness demand the most (Asian Development Bank, 2022). On their part, employers invest in informal re-skilling programmes because they do not believe that the acquisition of degrees is an indicator of relevant capability.

The cost of inaction is not abstract. Failure by graduates to secure jobs that match their qualification leads to wastage of human capital when it is needed to fetch returns the most. Youths who had spent years of their lives in education end up demoralized; some of them abandon their homes and capitalize on the brain drain process. Companies unable to recruit skilled labour either hold up, or succeed with a low-cost labour force, or use imported skills - none of which is conducive to the productivity benefits on which a knowledge economy thrives. The skills gap is a direct pull-back to the economic transformation path of a country that is in the midst of a big reform cycle, as it is the case in Uzbekistan.

This paper will look at graduate employability crisis in the labour market of Uzbekistan: how big a problem it is, how it has come about and what can and actually be done about it. It relies on international experience to diagnose the reasons why the gap is there and what types of interventions have been successful in similar environments. It then transforms such analysis into a concrete, practical suggestion to a practical institutional actor. The stakes are so great that it is worth this degree of specificity: in case Uzbekistan is serious about developing a knowledge economy, it needs to create one that can support a workforce in such an economy.

Authors: Ruxshona Kilichbayeva and E’zoza Avazova

Programmes:

• Ruxshona Kilichbayeva — BA in Commercial Law, Level 5

• E’zoza Avazova — BSc in Economics with Finance, Level 5

Paper Title: What are the factors that determine startup ecosystem success? Lessons for Uzbekistan from Israel, Singapore and Poland

Pathway: Innovation Ecosystems and Technology Transfer

This paper explores how successful startup ecosystems are shaped and what Uzbekistan can learn from international examples. By analysing the experiences of Israel, Singapore, and Poland, the authors connect innovation, entrepreneurship, institutional support, investment, and technology transfer to the broader goal of building a competitive knowledge economy.

Impact Statement:

The shift toward Knowledge Economy which was defined by UNESCO (2026) as an economy where human capital, innovation, technology and information are the core drivers of the growth rather than material resources. Knowledge Economy stands as one of the most structural transition in modern economy in the world. The transition became strategic necessity for Central Asian states, particularly for Uzbekistan. Central Asia heavily depends on remittances and commodity exports, rather than startups. That is why there are several challenges regarding to startup ecosystem in Uzbekistan.

According to the Nodirbek Razzokov (2025), there is a huge need to redevelopment of the system to conduct an IPO and to meet the requirements of international investors. Startups cannot upscale into international firms without initial public offerings (IPOs) and proper venture capital ecosystems. World Bank (2025) highlights that underdeveloped capital markets are reducing the investments. Uzbekistan now faces two options: either relying only on the conventional sectors or build strong institutions and legal framework where innovation, startups and private investment develop and become one of the main reasons of economic growth.

Uzbekistan is at an important stage in its startup ecosystem development. There is young population who has digital skills and several startup ideas. This creates strong potential for Uzbekistan to establish innovation-based economy in today’s world. However, according to the report of KPMG (2024), startup ecosystem is in an early stage in Uzbekistan due to lack of private venture capital, absence of legal system and few exit opportunities for investors and founders. Additionally, according to OECD (2026) analysis, the lack of exit pathways limits development of ecosystem and considerably decreases the venture capital inflows. The consequences of delay in the establishment of the strong startup ecosystem may lead to slow economic growth and it increases the risk of losing position in the global economy.

This paper argues that three specific interventions including private venture fund, strong legal framework and international dual listing bridge can provide institutional foundations for the startups in Uzbekistan.

Authors: Xulkar Boybutayeva and Amina Abdullayeva

Programmes:

• Xulkar Boybutayeva — BSc Economics with Finance, Level 5

• Amina Abdullayeva — BSc in Economics with Finance, Level 5

Paper Title: Institutional Barriers Behind Brain Drain in Uzbekistan: The Role of Meritocracy Gaps and Weak Policy Implementation

Pathway: Human Capital and the Knowledge Workforce

This paper focuses on the institutional factors that contribute to brain drain in Uzbekistan. The authors examine how gaps in meritocracy, weak policy implementation, and limited professional opportunities may encourage talented individuals to seek opportunities abroad. Their work highlights the importance of fair, transparent, and effective institutions in retaining human capital and strengthening the country’s knowledge-based development.

Impact Statement:

Thousands of skilled professionals and students from Central Asia emigrate every year for study and employment purposes, and only a few of them return home. For several years, the region has faced contradictions in managing the outflow of brain drain. Since it receives short-term financial benefits through remittances inflow, which increases consumption and investment of the receiver family, profound policies are not applied to prevent its long-term loss. They include slowed economic development, insufficient innovation, and unproductiveness. At the same time, governments increase their investments in education or produce a more highly qualified workforce to push economic activity. However, many of these trained specialists leave their home countries without offsetting the investment through innovations and taxes, which leads to limited return on investment. The term “brain drain” refers to a large-scale emigration of highly skilled and educated workforce from less developed home countries to developed countries in pursuit of high salary, tremendous opportunities, alongside economic and political stability.

The high relevance of the topic is associated with potential gains and losses on account of an increased number of leaving high-skilled human capital. Central Asia experiences a significant level of brain drain, with Uzbekistan itself at 4.00 index as for 2024, 10 being the highest (Global Economy, 2026). Although Uzbekistan was able to decrease it from 6.00 in 2016 to 4.00 by 2024, the loss of highly skilled professionals, even at a moderate level, leads to structural problems. An interesting paradox emerges when one can see record levels of remittances of 18.9 billion dollars for 2025 in Uzbekistan, accounting for 21% of GDP, which reduced poverty and increased the living standards of households through increased income. On the other hand, significant dependence on remittance inflows can lead to an increase in vulnerability to external shocks, governmental challenges, and slow economic growth.

First of all, the opportunity cost of inaction for Uzbekistan can be struggling in a development stagnation, when the country develops but is not as efficient and innovative as it would be with highly educated professionals. The loss of a highly trained and educated labor force will result in slow innovation, reduced productivity, and hardships in moving to higher value-added industries, thus occurring in a middle-income trap (Daniel, C. et al.,2026). According to the World Bank, Uzbekistan is a lower-income country that plans to switch to a higher middle- income status by 2030. Indeed, if Uzbekistan does not retain and reintegrate its talents, it will not be able to bypass the nonconvergence trap in the long term.

Moreover, the cost of inaction also includes fiscal loss. While Uzbekistan is significantly investing in education to produce a more skilled human capital dozens of local talents are leaving the country before paying taxes and offsetting the investments.

Without immediate institutional reform, Uzbekistan risks locking itself into a development model driven by permanent economic stagnation, poor ROE on education investment, dependence on remittances, and a low-value sectors trap. Low return investments result in total loss and dependence on a low-qualified workforce. Uzbekistan will be condemned to low-value sectors, stripping the country of its competitive edge and stalling national progress indefinitely.