Uzbekistan’s Decoupling Growth: The Hidden Costs of Urban Expansion

A new study published in Economies by Firuza Achilova and colleagues analyzes data spanning 1991 to 2024, revealing that a 1% increase in GDP per capita correlates with a 0.24% reduction in long-term CO2 emissions. This trend suggests Uzbekistan is successfully navigating the Environmental Kuznets Curve, where structural shifts and improved efficiency begin to outweigh the carbon cost of industrial output.

However, the composition of this growth presents a challenge. Contrary to the assumption that a service-heavy economy is inherently greener, the study finds that a 1% increase in the service sector’s share of GDP corresponds to a 1.37% rise in emissions. This is largely because Uzbekistan’s service economy remains tethered to fuel-intensive logistics, transport, and commercial infrastructure rather than digital or knowledge-based services. Similarly, urban expansion is currently carbon-intensive; for every 1% increase in urban population growth, emissions climb by 0.37% as cities sprawl before the benefits of high-density infrastructure or mass transit can take hold.

For policymakers, the path forward requires moving beyond aggregate growth targets. With the study noting that 66.5% of short-term environmental deviations are corrected within a year, there is a clear window for intervention. Prioritizing energy-efficient building codes, the electrification of public transport, and a shift toward digital-first services could lock in the current decoupling trend, ensuring that the country's transition to a modern economy does not come at the cost of its climate objectives.