Remittances as a Source of Finance for Entrepreneurship in Uzbekistan

Transforming the remittances and savings of labor migrants into a source of financing for entrepreneurship as well as other development projects is the focus of the migration policies of many governments in migrant-sending countries. Unilateral transfers from overseas are playing an increasingly important role in the economies of developing countries. To
take the case of Uzbekistan, labor migrants’ remittances and savings have facilitated the development of the country’s financial sector by prompting the development of sophisticated money transfer operators. However, the degree to which these flows finance the needs of business enterprises remains unclear.
The aim of this research is to analyze the degree to which remittances from labor migrants are easing the financial constraints on small businesses in Uzbekistan. To put it another way, the research looks to shed light on the significance of labor migrants’ remittances and savings for entrepreneurship. As such, this research has important policy implications. Small businesses are believed to be crucial for job creation and economic growth. The results of this paper indicate that the link between labor migration and business investment in Uzbekistan is rather equivocal.

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