TASHKENT

Uzbekistan, one of the top producers of gold in the world, has suspended the sale of gold due to the fall in gold prices on the world market.

The Central Asian country ranks 8th in the world for gold production, producing 101.6 tonnes in 2020, up from 94.6 tonnes produced in 2019. In the last 10 years, it exported 687 tonnes of gold.

Gold sales were halted last autumn amid a decline in the price. In May this year, the price of gold exceeded $1,900 per ounce and Uzbekistan resumed the gold export. The country sold gold for almost $1.2 billion in May and for $191 million in June.

The decline in the gold price – to $1,782 per ounce – led to the central bank’s decision to suspend the sale of gold again, the State Statistics Committee said.

Uzbekistan’s official reserve assets rose by $965 million in a month and amounted to $35.1 billion as of August 1, 2021. The share of gold in the reserves, according to the latest data, is $21.5 billion. This is almost 367 tonnes of gold. There are 332.8 tonnes of gold in the republic’s reserves. Gold in reserves also increased by 9.3 tonnes.

The rise of its gold industry in Uzbekistan dates back to the late 1960s, when the Soviet government greenlit the development of Muruntau, a gold mine that has one of the world’s largest reserves. The country currently has 63 large-scale gold mining fields, which have total reserves of more than 2,500 tonnes of gold, and probable reserves of 5,990 tonnes.

The leading gold producer in the country is state-owned Navoi Mining and Metallurgical Combinat (NMMC).

Unlike many other industries, NMMC said in July that gold production was not badly affected by the COVID-19 pandemic, as the company secured its supplies and demand for the precious metal remained strong.

The company increased its annual net profit by 209 percent in 2020, helping Uzbekistan climb further up the ranks of the world’s top gold producers. NMMC, which accounts for 70 percent of the country’s total gold production, said its net profit rose to $716.6 million in 2020 from $231.6 million in 2019. It earned $4.5 billion in revenues from gold sales last year. The company, which is the Central Asian nation’s biggest taxpayer, also said it successfully rolled out projects worth $628 million.

The state-owned company has also been undergoing major change, after President Shavkat Mirziyoyev in 2019 ordered its transformation into a joint-stock company, with a modern corporate governance system and financial statements prepared in line with international standards. This also included spinning off its gold business into a separate legal entity, a process that is currently underway.