• KGS/USD = 0.01144 0%
  • KZT/USD = 0.00197 0%
  • TJS/USD = 0.09722 -0.1%
  • UZS/USD = 0.00008 -0%
  • TMT/USD = 0.28575 -0.14%
  • KGS/USD = 0.01144 0%
  • KZT/USD = 0.00197 0%
  • TJS/USD = 0.09722 -0.1%
  • UZS/USD = 0.00008 -0%
  • TMT/USD = 0.28575 -0.14%
  • KGS/USD = 0.01144 0%
  • KZT/USD = 0.00197 0%
  • TJS/USD = 0.09722 -0.1%
  • UZS/USD = 0.00008 -0%
  • TMT/USD = 0.28575 -0.14%
  • KGS/USD = 0.01144 0%
  • KZT/USD = 0.00197 0%
  • TJS/USD = 0.09722 -0.1%
  • UZS/USD = 0.00008 -0%
  • TMT/USD = 0.28575 -0.14%
  • KGS/USD = 0.01144 0%
  • KZT/USD = 0.00197 0%
  • TJS/USD = 0.09722 -0.1%
  • UZS/USD = 0.00008 -0%
  • TMT/USD = 0.28575 -0.14%
  • KGS/USD = 0.01144 0%
  • KZT/USD = 0.00197 0%
  • TJS/USD = 0.09722 -0.1%
  • UZS/USD = 0.00008 -0%
  • TMT/USD = 0.28575 -0.14%
  • KGS/USD = 0.01144 0%
  • KZT/USD = 0.00197 0%
  • TJS/USD = 0.09722 -0.1%
  • UZS/USD = 0.00008 -0%
  • TMT/USD = 0.28575 -0.14%
  • KGS/USD = 0.01144 0%
  • KZT/USD = 0.00197 0%
  • TJS/USD = 0.09722 -0.1%
  • UZS/USD = 0.00008 -0%
  • TMT/USD = 0.28575 -0.14%
22 May 2025

Cuts to USAID Leave Central Asia Facing Development Challenges

When American President Donald Trump announced a freeze and overhaul of his country’s foreign aid in early 2025, the move sparked concern across Central Asia. For more than three decades, the United States Agency for International Development (USAID) had been a key contributor to development in the region, supporting education, healthcare, agriculture, and environmental protection.

Support for Weaker Economies

USAID’s role was particularly critical in economically vulnerable countries like Kyrgyzstan and Tajikistan. Its sudden withdrawal now leaves local governments scrambling to compensate with limited domestic resources.

The cuts have not been uniform, but the overall impact has been profound. According to the Center for Global Development, Tajikistan and Kyrgyzstan lost 78 percent and 69 percent of their USAID-backed programs, respectively. In Kazakhstan, Turkmenistan, and Uzbekistan, nearly all aid programs were discontinued.

Foreign aid to the region has often reflected shifting geopolitical dynamics. In Uzbekistan, for example, support surged from $6 million to $40 million in 2016 following President Shavkat Mirziyoyev’s rise to power. Kyrgyzstan received $75 million in 2010 amid negotiations over the U.S. military base there. In contrast, aid to Turkmenistan fell to just $2.8 million by 2024.

Limited Time to Adjust

While Kazakhstan’s more robust economy allowed for a gradual reduction in U.S. assistance, American companies remain active in its vital oil sector. Yet the abrupt nature of the broader aid pullback has disrupted numerous projects with little warning. Health and education initiatives were halted, as were efforts to bolster trade and cross-border infrastructure, critical for Uzbekistan and Kazakhstan as they seek to deepen global economic ties.

Environmental initiatives also suffered. With Central Asia especially vulnerable to climate change, USAID had funded resilience-building programs focused on water access and renewable energy. These efforts have largely ceased, raising concerns among farmers and local communities who had come to rely on them.

Civil Society Under Strain

Some governments in the region may quietly welcome the cuts, particularly those wary of foreign-backed NGOs. USAID frequently partnered with local civil society organizations and media outlets, entities that Central Asian authorities often view with suspicion. The loss of U.S. support has left these groups increasingly exposed to state pressure.

Tajikistan offers a telling case. In 2020, USAID partnered with the Aga Khan Foundation during the COVID-19 pandemic. But two years later, following unrest in the country’s Gorno-Badakhshan Autonomous Region, the government launched a crackdown on the foundation. This underscores how some aid programs, especially those linked to civil society, are perceived as threats.

Although USAID did not operate programs directly, its funding empowered local partners. With that backing gone, and less pressure from Washington, several Central Asian governments have tightened their control over independent organizations.

Seeking Alternatives

Replacing USAID’s role will not be easy. The European Union and countries such as France and Germany have long supported development in Central Asia, but their resources are stretched, especially with increased attention and funding directed toward Ukraine. Despite EU pledges of investment via the Global Gateway initiative, support for democracy, civil society, and human rights appears to be deprioritized.

China and Russia continue to provide aid in the region, but their assistance aligns with different values. Their programs rarely promote media freedom, gender equality, or civil society empowerment. While state actors may welcome this model, independent activists often view it with skepticism.

In Uzbekistan, this dynamic has contributed to the emergence of government-organized NGOs, which serve a controlled function in international cooperation. Critics argue this approach weakens efforts to foster an open and resilient civil society.

With USAID largely absent, Central Asia must now navigate a complex development landscape, balancing state control with the aspirations of its people.

Read more of The Times of Central Asia’s coverage on the demise of USAID funding in our special reports

Russia: Thousands of Central Asia-Born Russians Sent to Ukraine Front Line

A senior Russian official has said that thousands of migrants from Central Asia who became Russian citizens were sent to fight in Ukraine after they tried to dodge conscription.

“Our military investigations directorate conducts regular raids,” Alexander Bastrykin, head of Russia’s Investigative Committee, said on Tuesday in remarks that were reported by the Russian state-run TASS news agency.

“So far, we’ve tracked down 80,000 such Russian citizens who didn’t just avoid the front lines — they wouldn’t even show up at military enlistment offices. We’ve registered them for military service, and about 20,000 of these ‘new’ Russian citizens, who for some reason no longer want to live in Uzbekistan, Tajikistan, or Kyrgyzstan, are now on the front lines,” Bastrykin said at the St. Petersburg International Legal Forum.

Bastrykin’s comments contributed a piece to the often murky picture of the involvement of people from Central Asia in Russia’s war effort in Ukraine in the last three years. In addition to conscription measures, Russia has also sought to replenish its ranks by offering contracts and other incentives to foreigners willing to fight.

Uzbekistan and Kazakhstan are among Central Asian countries that ban their nationals from fighting in foreign conflicts and there have been several high-profile prosecutions of citizens who fought for Russia and returned home. It is a sensitive political matter in Central Asia, a region that seeks to project neutrality in the conflict between Russia and Ukraine.

Kazakhstan has said it is reviewing a report by a Ukrainian institution that said about 661 Kazakh citizens have fought for Russia since it launched a full-scale invasion of Ukraine in February 2022. The I Want To Live center, which is run by the Ukrainian security services and assists with surrender requests from soldiers fighting for Russia, published a list of what it said were the Kazakh nationals. Of the 661, at least 78 have been killed, according to the center. Without providing details, it said it received the list from its own sources within the Russian military.

Uzbekistan is conducting a similar investigation based on data from the Ukrainian group.

Uzbekistan Plans to Restore Khiva’s Outer Fortress, Draw Tourists

The walls of Dishan-Kala, the remnants of a 19th century fortress in the Uzbek city of Khiva, have been deteriorating for many years. Now the Uzbek government plans to restore destroyed sections of the walls, remove some nearby buildings that are cluttering the historical structure and turn the site into a major tourist attraction. 

The goal is to transform Dishan-Kala, the outer fortress, into a landmark similar to Ichan-Kala, the walled inner town at Khiva that is a UNESCO world heritage site and home to multiple cultural sites, exhibition sites and artisan shops. Some 1 million foreign tourists and 3.5 million local people visited Ichan-Kala in 2024, and it is expected to draw 2 million foreigners and nearly 5 million domestic tourists by the end of this year, the Uzbek Ministry of Ecology, Environmental Protection and Climate Change said in a statement on Tuesday. 

The new development campaign aims “not only to preserve Dishan-Kala but also to unlock and enhance its full tourism potential,” the ministry said. 

Uzbekistan’s growing tourism industry depends in large part on its rich historical legacy in places such as Khiva, Bukhara and Samarkand, but the development of the industry has sometimes conflicted with concerns about the preservation of ancient sites. Last year, despite UNESCO’s concerns, Uzbekistan pushed ahead with plans for a big tourist complex next to the historical center of Bukhara, a jewel of medieval architecture in Central Asia.

In 2021, UNESCO’s world heritage committee referred to development and tourism pressures in Khiva. It also said it regretted the demolition of large areas of Dishan-Kala, noting that it had served as the residential neighborhood for the fortified inner city and that the links between the two parts of ancient Khiva should be strengthened.  

Built in 1842, the fortress walls of Dishan-Kala are currently in a state of neglect. Some 2,000 meters of its 6,200-meter wall have been destroyed, and another 2,500 meters are in “critical condition,” the ecology ministry said. 

“For many years, illegal constructions sprang up around the wall, leaving virtually no space for access or movement along its perimeter,” it said. 

Photos of Dishan-Kala show trash and piles of debris alongside crumbling walls, in contrast with the well-maintained Ichan-Kala area. The plan is to remove 55 residential and other buildings near the Dishan-Kala walls and install parks, landscaping and a pedestrian alley. 

Cuts to USAID Leave Central Asia Facing Development Challenges

When American President Donald Trump announced a freeze and overhaul of his country’s foreign aid in early 2025, the move sparked concern across Central Asia. For more than three decades, the United States Agency for International Development (USAID) had been a key contributor to development in the region, supporting education, healthcare, agriculture, and environmental protection.

Support for Weaker Economies

USAID’s role was particularly critical in economically vulnerable countries like Kyrgyzstan and Tajikistan. Its sudden withdrawal now leaves local governments scrambling to compensate with limited domestic resources.

The cuts have not been uniform, but the overall impact has been profound. According to the Center for Global Development, Tajikistan and Kyrgyzstan lost 78 percent and 69 percent of their USAID-backed programs, respectively. In Kazakhstan, Turkmenistan, and Uzbekistan, nearly all aid programs were discontinued.

Foreign aid to the region has often reflected shifting geopolitical dynamics. In Uzbekistan, for example, support surged from $6 million to $40 million in 2016 following President Shavkat Mirziyoyev’s rise to power. Kyrgyzstan received $75 million in 2010 amid negotiations over the U.S. military base there. In contrast, aid to Turkmenistan fell to just $2.8 million by 2024.

Limited Time to Adjust

While Kazakhstan’s more robust economy allowed for a gradual reduction in U.S. assistance, American companies remain active in its vital oil sector. Yet the abrupt nature of the broader aid pullback has disrupted numerous projects with little warning. Health and education initiatives were halted, as were efforts to bolster trade and cross-border infrastructure, critical for Uzbekistan and Kazakhstan as they seek to deepen global economic ties.

Environmental initiatives also suffered. With Central Asia especially vulnerable to climate change, USAID had funded resilience-building programs focused on water access and renewable energy. These efforts have largely ceased, raising concerns among farmers and local communities who had come to rely on them.

Civil Society Under Strain

Some governments in the region may quietly welcome the cuts, particularly those wary of foreign-backed NGOs. USAID frequently partnered with local civil society organizations and media outlets, entities that Central Asian authorities often view with suspicion. The loss of U.S. support has left these groups increasingly exposed to state pressure.

Tajikistan offers a telling case. In 2020, USAID partnered with the Aga Khan Foundation during the COVID-19 pandemic. But two years later, following unrest in the country’s Gorno-Badakhshan Autonomous Region, the government launched a crackdown on the foundation. This underscores how some aid programs, especially those linked to civil society, are perceived as threats.

Although USAID did not operate programs directly, its funding empowered local partners. With that backing gone, and less pressure from Washington, several Central Asian governments have tightened their control over independent organizations.

Seeking Alternatives

Replacing USAID’s role will not be easy. The European Union and countries such as France and Germany have long supported development in Central Asia, but their resources are stretched, especially with increased attention and funding directed toward Ukraine. Despite EU pledges of investment via the Global Gateway initiative, support for democracy, civil society, and human rights appears to be deprioritized.

China and Russia continue to provide aid in the region, but their assistance aligns with different values. Their programs rarely promote media freedom, gender equality, or civil society empowerment. While state actors may welcome this model, independent activists often view it with skepticism.

In Uzbekistan, this dynamic has contributed to the emergence of government-organized NGOs, which serve a controlled function in international cooperation. Critics argue this approach weakens efforts to foster an open and resilient civil society.

With USAID largely absent, Central Asia must now navigate a complex development landscape, balancing state control with the aspirations of its people.

New Report Predicts Surge in Islamic Finance Across Central Asia

A new report co-published by the Eurasian Development Bank (EDB), the Islamic Development Bank Institute, and the London Stock Exchange Group forecasts robust growth for Islamic finance in Central Asia. Titled “The Future of Islamic Finance in Central Asia,” the report was unveiled at the 2025 Annual Meetings of the Islamic Development Bank Group in Algiers, Algeria.

The study offers a comprehensive overview of the Islamic finance landscape across Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. While Sharia-compliant financing remains a relatively recent addition to the global financial system, having developed over the past three decades, it is becoming an increasingly significant component in the sustainable development strategies of Central Asian economies. All five governments are reportedly prioritizing the expansion of Islamic finance.

As of early 2024, the region is home to 18 Islamic banks and 14 non-bank financial institutions, including Islamic banking windows. The sector also features takaful (Islamic insurance) operators, microfinance institutions, Ijara (leasing) companies, and emerging Islamic FinTech ventures such as digital banks and wealth management platforms.

Total Islamic finance assets in Central Asia stood at $699 million at the start of 2024. According to the Islamic Finance Development Report 2024, Kazakhstan ranked 19th globally in terms of Islamic finance development, above the global average, and leads the regional market.

Projections in the report anticipate substantial growth. Islamic banking assets in Central Asia are expected to rise to $2.5 billion by 2028 and $6.3 billion by 2033. Kazakhstan is forecasted to remain the regional leader, followed closely by Uzbekistan, buoyed by favorable demographics, economic momentum, and the depth of national banking sectors.

The sukuk (Islamic bond) market is also poised for rapid expansion. Baseline forecasts suggest sukuk issuance could reach $2.05 billion by 2028 and $5.6 billion by 2033.

EDB Chairman Nikolai Podguzov highlighted the bank’s commitment to fostering this growth: “The further development of Islamic finance in Central Asia will expand financial inclusion and connect local businesses to the global Islamic market, contributing to regional economic growth. With the Islamic Development Bank Group’s support, the EDB has initiated the creation of an Islamic Window to finance projects in compliance with Sharia principles.” He added that key investment priorities will include energy, transport, social infrastructure, food security, and industry.

Kazakh Schoolchildren Offered Summer Job Opportunities

Kazakhstan’s Minister of Labor and Social Protection, Svetlana Zhakupova, announced at a recent government meeting that the ministry is prepared to assist nearly 1.4 million schoolchildren aged 14 to 18 in finding summer employment.

Under the country’s Labor Code, minors are permitted to work under certain conditions, including a reduced schedule of no more than 24 hours per week. Importantly, such work must be undertaken outside of school hours.

“To facilitate employment, the following measures will be available to students during the upcoming summer holidays: selection of suitable vacancies through the Electronic Labor Exchange, online training programs, public works initiatives, and career guidance services,” Zhakupova stated.

The Electronic Labor Exchange, accessible via enbek.kz, now includes a dedicated section titled “My Summer Vacation”, which allows teenagers to register, upload their résumés, and search for job opportunities independently. For students under the age of 16, registration and the creation of a personal account must be handled by a parent or legal guardian.

As previously reported by The Times of Central Asia, approximately 1.8 million young people aged 15 to 28 were employed in Kazakhstan in 2024, a 0.6% increase over the previous year.