Impact of Foreign Ownership of Domestic Importers on Exchange Rate Pass-Through to Import Prices in Uzbekistan

Rashid Mirzaakhmedov
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Rashid Mirzaakhmedov: The Central Bank of Uzbekistan

No 22-2026, IHEID Working Papers from Economics Section, The Graduate Institute of International Studies

Abstract: This paper examines how foreign ownership of importing firms shapes exchange rate pass-through (ERPT) to import prices in Uzbekistan across three distinct monetary policy regimes. Using transactionlevel customs data matched with a firm ownership registry, I find that ERPT remained near-complete before inflation targeting but declined sharply following its formal adoption in October 2019. Foreignaffiliated importers exhibit significantly lower pass-through than domestically owned firms under inflation targeting, with the gap most pronounced for capital and intermediate goods. Rolling window estimation reveals that foreign affiliates adjusted more rapidly to the new monetary framework, suggesting that ownership structure and institutional credibility jointly shape import price dynamics. The results provide micro-level evidence that the central bank’s credibility has weakened the exchange rate channel of inflation, while the growing presence of foreign affiliates reduces the effectiveness of exchange rate depreciation as an instrument for correcting the trade balance.

Keywords: Exchange Rate Pass-Through; Import Prices; Foreign Ownership; Inflation Targeting; Transaction-level Customs Data; Uzbekistan (search for similar items in EconPapers)
JEL-codes: E31 E52 F14 F23 F31 (search for similar items in EconPapers)
Pages: 17 pages
Date: 2026-08-07
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Persistent link: https://EconPapers.repec.org/RePEc:gii:giihei:heidwp22-2026

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