Zeromax’s diamonds for Gulnora, $100 billion promise to Trump, toxic Tashkent, Rahmonov escapes accountability – Weekly Analysis

Uzbekistan’s relations with the United States are steadily warming. According to several politicians, including Jonathan Henick, the U.S. ambassador to Uzbekistan, ties between Tashkent and Washington have reached their highest level in history.

The Uzbek leader’s meeting with U.S. President Donald Trump during the 80th session of the United Nations General Assembly in September remains memorable. The meeting saw the signing of contracts worth $105 billion, Trump announcing Uzbekistan’s purchase of 22 “787 Dreamliner” aircraft for $8 billion, and the Uzbek president nominating his U.S. counterpart for a Nobel Prize for resolving seven conflicts. A follow-up meeting between Mirziyoyev and Trump is eagerly anticipated. After Mirziyoyev’s visit to Washington for a C5+1 meeting, it was announced that Uzbekistan plans to invest nearly $35 billion in the U.S. over the next three years across key sectors including minerals, aviation, automotive parts, infrastructure, agriculture, energy, chemicals, and information technology, with investments potentially exceeding $100 billion over the next decade. According to Trump, these funds will target the U.S. economy’s strategic areas such as rare minerals, aviation, auto parts, infrastructure, agriculture, energy, chemicals, and IT.

But where will Uzbekistan find such funds? With a global debt of $72 billion and a GDP recently surpassing $100 billion, the source of this investment remains unclear. Official Tashkent has not confirmed or commented on the figures announced by Trump.

A week after the Uzbek president’s visit to the White House, it was announced that the U.S.-Uzbekistan Business and Investment Council would be established. President Mirziyoyev signed the relevant decree on November 12. The council aims to strengthen and expand mutually beneficial trade and investment ties, improve the business environment, support entrepreneurial activity, and ensure effective coordination of initiatives in this area.

Under the decree, the head of the Presidential Administration, Saida Mirziyoyeva, will lead the council, approve its composition, regulations, and operational procedures. The council will coordinate strategic business initiatives, major investment and trade projects, and monitor their implementation. It will continue negotiations on tariff reductions and propose measures to diversify the country’s investment portfolio, including parts of the Central Bank’s foreign currency reserves and other assets. The council’s office will be based in the U.S.

Additionally, starting January 1, 2026, Uzbekistan’s embassy in the United States will include an advisor-ambassador position representing the Presidential Administration. Appointment, dismissal, and approval of the advisor-ambassador’s regulations will be carried out by the head of the Presidential Administration. The advisor-ambassador will report to the Presidential Administration and support the embassy’s efforts to develop bilateral relations.

The decree also addresses increasing embassy staff, opening additional consulates in the U.S. within a month, and other diplomatic expansions. On the same day the decree was issued, Saida Mirziyoyeva met with a U.S. business delegation led by David Bednar, an elder of the Church of Jesus Christ of Latter-day Saints in Utah. The meeting was attended by presidential advisors Abdulahiz Komilov on foreign policy and Sardor Umurzoqov on strategic development, marking the first time Umurzoqov appeared alongside Mirziyoyeva at such a meeting.

Zeromax and Gulnora Karimova: Swiss court reveals century’s bankruptcy secrets

In Switzerland, a creditor of Zeromax is pursuing Ernst & Young in court. The Federal Supreme Court ordered EY’s Swiss branch to provide documents related to the Zeromax audit. The ruling could result in billions in fines and serious reputational damage for the company.

The case has been ongoing for five years. The auditor is accused of overlooking suspicious transactions, issuing positive reports, and misleading creditors about Zeromax’s financial condition.

According to Tippinpoint, the court ordered EY Switzerland to disclose a wide range of documents, which journalists have called “a new chapter in the financial thriller surrounding Uzbekistan’s ‘princess’ Gulnora Karimova.”

Zeromax, founded in Delaware in 1999, held assets across dozens of industrial sectors in Uzbekistan. It abruptly declared bankruptcy in 2010, listing $2.56 billion in assets against $4.12 billion in liabilities. Later reports revealed that its actual assets were only 6.66 million Swiss francs, while the total claims of 191 creditors exceeded 5.6 billion francs. This was Switzerland’s second-largest bankruptcy in history.

Creditors ranged from small German firms and utility companies to Uzbek oil and gas enterprises and a Russian pipeline consortium. Even former “Bunyodkor” star Rivaldo, owed 22.7 million francs, was among them.

In 2019, U.S. hedge fund Lion Point Capital acquired the rights to recover Zeromax debts and sued EY Switzerland for negligence.

According to Financial Times, Zeromax’s pre-bankruptcy expenditures were largely unrelated to business. Between 2006 and 2007, the company spent more than $13 million on luxury goods, including $2 million at a Christian Dior boutique in Geneva. Between 2008 and 2009, it spent another $25 million on jewelry, including $6 million at Graff Diamonds.

Zeromax is linked to Gulnora Karimova, daughter of Uzbekistan’s first president, though she has denied involvement. Evidence shows she used at least some of the jewelry purchased by the company. In 2016, Swiss police searched her Geneva bank safes at Lombard Odier, uncovering jewelry including Boucheron diamond rings valued at $2.5 million, paid for by Zeromax.

Police documents reviewed by Financial Times confirmed that Gulnora Karimova was the end recipient of the jewelry, purchased with funds from a Zeromax-linked bank account.

Despite these facts, EY Switzerland issued “clean” audit reports for the company. It remained Zeromax’s auditor from 2007 to 2010 but ceased publishing reports.

Law firm Quinn Emanuel is representing creditors in court, seeking $1 billion in damages from Ernst & Young. The Federal Court rejected the auditor’s appeal, ordering disclosure of all Zeromax-related documents, payment of 25,000 francs in court costs, and 30,000 francs in compensation to the plaintiffs.

The audit firm confirmed it would comply with the ruling. Legal experts suggest the case may set an important precedent for auditor liability in Switzerland.

Drug offenders to face harsher penalties in Uzbekistan

Uzbekistan will no longer allow early release or sentence reduction for individuals convicted of drug-related crimes. The policy was announced in a presidential decree issued on November 3 this year, titled “Comprehensive Measures to Effectively Protect Public Health and the National Gene Pool from Drugs and Drug-Related Crimes.”

Under Articles 73 and 74 of the Criminal Code, prisoners can generally be considered for early release or have their sentences reduced. However, these provisions will not apply to drug offenders.

Additionally, any drug crime committed against minors, or involving minors, will now be considered an aggravating circumstance. Direct criminal liability will also be established for those who involve minors in the use of powerful narcotic substances.

The penalties for distributing such substances near educational institutions, student dormitories, or children’s camps—and their surrounding areas—will be doubled. Those who involve minors in drug use in these areas will face direct criminal responsibility.

Criminal liability will also now apply to those who sponsor illegal drug trafficking, organize criminal drug groups, or operate unlawful drug laboratories, with sentences of up to 20 years in prison.

Drug-related crimes in Uzbekistan have been rising steadily. In 2020, 6,032 cases were registered, increasing to 12,278 by 2024. Of these, 3,167 involved young people, meaning that one in three offenders is under 30 years old. The share of women involved in drug crimes has also tripled compared to five years ago, when it accounted for only a few percent of cases.

According to the National Center for Drug Control, synthetic drugs and online distribution channels now pose the greatest threat, surpassing traditional opiates. Substances such as mephedrone, “spice,” A-PVP, and other synthetic drugs produced in hidden laboratories are rapidly increasing. These drugs are cheaper to produce, easier to transport, and more potent, which has allowed them to displace traditional opiates and cannabis.

Illegal circulation of prescription drugs is also on the rise. Substances such as pregabalin, sibutramine, and tropicamide, which should only be sold with a prescription, have become a new form of dependency. In the past three years, seizures of these drugs have multiplied several times, with most distributed online or through pharmacies.

Officials report that since the start of the year, more than 11,000 drug crimes have been recorded, and nearly 2.5 tons of narcotic substances have been confiscated. Nonetheless, civil society and activists accuse the government of slow responses to drug trafficking, distribution, and importation. Criticism has intensified over the rising trade in synthetic drugs, with concerns that some areas allow open use, transport, and sale, while law enforcement measures remain insufficient.

Air pollution rises again in Tashkent

On November 10, according to IQAir, Tashkent ranked second among major world cities for air pollution.

The concentration of PM2.5 particles in Tashkent that day was 40 times higher than the World Health Organization’s recommended annual limit. The Uzbekistan Hydrometeorology Service advised residents and visitors to take precautions, reduce outdoor activities, and wear masks when going outside.

The highest pollution levels in the country were recorded in Andijan. On November 11, both Tashkent and Andijan saw concentrations of harmful dust particles significantly exceeding permissible levels. Data from automatic monitoring stations showed that PM10 particles in Andijan reached 502 µg/m3, twice the local annual limit, while PM2.5 levels were 314 µg/m3, almost nine times the national annual limit. According to the WHO, these levels are dozens of times above international safety standards.

This severe air pollution affected nearly all regions of the country. Authorities at the Ministry of Ecology, Environmental Protection, and Climate Change did not provide detailed explanations or updates on ongoing measures. They only reported that the activities of 106 enterprises in Tashkent city and region were temporarily suspended, and 58 greenhouses were fined for emitting harmful chemical, physical, and biological substances into the atmosphere.

Tashkent city officials claimed, without providing evidence or expert assessments, that the city’s air quality deterioration is primarily caused by greenhouse operations in the nearby Tashkent region. Economist Otabek Bakirov strongly disputed this claim, saying: “Blaming greenhouses for Tashkent’s air pollution has become a recurring narrative, diverting attention from the energy companies. It has been a month since energy providers were tasked with ensuring gas supply to the greenhouses. Perhaps the question should be directed at them. I repeat: one-third of the exported gas, whose revenue goes to oligarchs’ offshore accounts, is enough to supply all greenhouses in Uzbekistan for the entire season.”

In late October, a total of 174 trees and shrubs along the streets of Nukus and Bobur in the Yakkasaray district were cut down in violation of a moratorium, causing environmental damage valued at 1.46 billion UZS. Rasul Kusherboev, adviser to the Minister of Ecology, said the trees were felled overnight by the landscaping department under instructions from Deputy Mayor Bakhtiyor Rahmonov to plant replacements.

No action was taken against Rahmonov after the incident. On November 8, a criminal case was opened under Article 198, Part 2 of the Criminal Code against officials of the landscaping department and others for illegal large-scale cutting of forests, trees, or other plants. 

Kusherboev commented: “Interestingly, Deputy Mayor Bakhtiyor Rahmonov, who gave the order, has once again avoided responsibility. Instead, it seems the landscaping staff, who carried out the order and have no real authority, are being held accountable. This is a true example of injustice.”