Business & Economy - The Times Of Central Asia

Viewing results 1 - 6 of 1369

Slippery Slope: How Falling Oil Prices Threaten Kazakhstan’s Energy Giant

With global oil markets in flux and prices dipping below $70 per barrel, Kazakhstan’s state oil company faces mounting financial strain. If KazMunayGas (KMG) fails to adapt, it risks edging toward a fiscal cliff. Yet, political constraints, exacerbated by the ongoing specter of potential social unrest, have hindered the company’s ability to implement reforms. OPEC+ Fuels Market Uncertainty The global oil market is entering a new period of turbulence reminiscent of the pandemic era. Despite prolonged efforts by OPEC+ to manage output and stabilize prices, the alliance’s fragile consensus unraveled this April, when Saudi Arabia and Russia led an unexpected increase in production, undermining earlier commitments and tipping the market into oversupply. Meanwhile, U.S. shale producers have continued to expand their output and export aggressively, squeezing traditional suppliers out of lucrative Asian markets. A decelerating Chinese economy, the world’s largest oil importer, adds further downward pressure. As a result, Brent crude fell below $70 per barrel in early May and briefly traded under $65. For Kazakhstan, where oil exports are a key source of budgetary and foreign exchange income, this trend spells trouble, and KMG is particularly exposed. The “Black Hole” in KMG’s Finances Public data shows that KMG’s production costs vary from $40 to $70 per barrel, depending on the field. However, factoring in transportation, taxes, and social obligations, the real breakeven point nears $90 per barrel. Aging infrastructure in the Mangistau region, reliant on constant technical upkeep and subsidies, only adds to the burden. KMG’s debt load compounds the challenge. At the end of 2024, its total debt exceeded 4 trillion tenge ($7.87 billion). With export revenues dwindling, debt servicing is becoming untenable. Even short-term dips to $60-65 per barrel could have systemic consequences, stalling new investments, triggering layoffs, and slashing social spending. A key drain is OzenMunayGas (OMG), KMG’s subsidiary in Zhanaozen, where production costs reportedly hit $90 per barrel. “OzenMunayGas exemplifies how populism, inflated promises, and stagnant reforms can turn a major asset into a financial sinkhole,” Arman Bataev, a former internal auditor at KMG has stated. On his Telegram channel, Finmentor.kz, Bataev warned that a $90 production cost versus Brent at $59 is “not a temporary hardship but a dead end.” OMG required 30 billion KZT in financial aid last year, and Bataev predicts it may require 60-70 billion KZT in 2025. KMG Downplays Risks KazMunayGas officials maintain that the company is “prepared for all scenarios” and holds “sufficient reserves.” At a May press briefing, Deputy Chairman Aset Magauov emphasized that 70% of KMG’s output is sold domestically, insulating it somewhat from global price volatility. “Analysts expect prices to average $65 per barrel this year, but forecasts are inherently uncertain,” Magauov said. “We have contingency plans and cost-optimization measures ready. We are equipped to handle price fluctuations.” Magauov also noted that domestic oil prices are lower than export prices, and products like gasoline and diesel, refined at KMG’s three facilities, are now sold at market rates following the end of state price controls. He added...

Central Asia Kyrgyzstan Business & Economy Kyrgyzstan Business & Economy Kyrgyzstan Features

Rising Cement Prices in Kyrgyzstan Slow Economic Growth

In a bid to stabilize the construction market, the Cabinet of Ministers of Kyrgyzstan has lifted a temporary ban on cement imports. The decision is aimed at addressing soaring prices and growing demand for construction materials amid an ongoing nationwide building boom. According to government officials, the move is intended to support market competition, prevent material shortages, and reduce pressure on prices. “The lifting of the temporary ban on cement imports will support healthy competition in the market, prevent shortages, and stabilize prices for construction materials,” the cabinet stated. The ban had been introduced approximately one month earlier, following a surge in cement imports from neighboring countries. Officials argued that this influx had created unfair competitive conditions for domestic producers. Construction Boom Meets Market Tensions Kyrgyzstan’s construction sector has emerged as a key engine of economic growth in recent years. The government has made the development of this sector a priority, citing its importance for job creation, infrastructure expansion, and broader economic momentum. The country is currently in the midst of a construction boom, with large-scale projects such as stadiums, airports, and affordable housing developments underway. These initiatives are being supported by new mortgage lending programs and infrastructure investments. However, rapid growth has strained the supply of building materials, especially cement. Local media report that the construction of a new stadium in Bishkek, touted as the future largest in Central Asia, alone requires 135,000 cubic meters of cement. Concerns have also been raised over alleged artificial price hikes. While officials deny any supply issues, reports suggest that some market players may be inflating prices to maximize profit amid the surge in demand. Balancing Growth and Stability The lifting of the import ban signals a shift in government policy toward greater market flexibility in the face of inflationary pressures. It reflects broader challenges facing Kyrgyzstan’s economy as it seeks to balance robust growth in the construction sector with price stability and fair market practices. As the country continues its infrastructure push, the success of such measures will be critical not only to the construction industry but also to the broader trajectory of economic development in 2025.

Home Kyrgyzstan Lead Story Kyrgyzstan Business & Economy Kyrgyzstan Business & Economy Features

Central Asia Startup Cup: A Call for Regional Unity Through Innovation

There has been a significant growth in tech events in Central Eurasia throughout the last few years. Several years back you would only see these on a national level, it is hard to find something that isn’t regional these days. There is the Central Eurasian Venture Forum, the largest regional venture capital forum, which will take place on June 5 this year in Kazakhstan, which is also home to Digital Almaty and Digital Bridge. Tashkent has its ICT Week on September 23-26, 2025. Tajikistan hosts the Startupstan Summit, Georgia has the Central Eurasia Venture Summit, Azerbaijan the Baku ID & INMerge, and the list goes on. At the end of last month, Bishkek hosted the Central Asia Startup Cup, the largest tech conference to date in the Kyrgyz Republic focused on startups and venture capital. As reflected in the name of the event, the country is not an exception and is following the trend of regional cooperation. The keynote speaker came from the UK, Kyrgyz Republic-born Asel Sartbaeva, the CEO and Co-Founder of EnsiliTech, a startup with a technology that allows vaccines and other biopharmaceuticals to be stored and transported at room temperature. Aside from her keynote speech and presentation, Sartbaeva also participated in a panel session devoted to female founders. For the first time in the history of the Kyrgyz Republic, there were a huge array of venture capital investors — apart from domestic investors, the Central Asia Startup Cup hosted venture capital funds from Georgia, Kazakhstan, Tajikistan, Turkey, the UK, and Uzbekistan. The government’s interest in the startup ecosystem is also growing — a memorandum of cooperation was signed between Accelerate Prosperity, the organizing party of the conference, and the Ministry of Digital Development of the Kyrgyz Republic. Also, for the first time, the regional final of the Startup World Cup, organized in partnership with Pegasus Tech Ventures (USA), was held as a part of the Central Asia Startup Cup. The latter is a global contest with 100+ regional events held across North America, South America, Europe, Africa, Asia, and Australia, with each regional winner competing in the final in Silicon Valley. Porte Tech, a startup from Kazakhstan providing digital concierge solutions for hotels, was selected for the Startup World Cup Grand Final in San Francisco and will compete in for a $1,000,000 investment fund in October 2025. A traditional part of such tech conferences, the Startup Battle took place on the second day of the Central Asia Startup Cup, with eight teams reaching the finals. The Grand Prix of the conference and an equity-free prize of $10,000 were awarded to ArtSkin, a Kyrgyz hardware startup developing artificial skin for prosthetic limbs. Seven teams were also recognized with cash prizes of €5,000 each from the European Union's Last-mile Connectivity to Promote Digital Green Education Opportunities project: Nomado, Tez Jumush, Sound Vision, Edu Test, WeSave, TilZone, and The Tech. VoiceDiary, an AI companion for emotional support, received a trip to Silicon Valley as part of the Dive into Silicon...

Draft Uzbekistan Business & Economy Uzbekistan Business & Economy

Uzbekistan to Chair ADB Board, Host 2026 Annual Meeting in Samarkand

Uzbekistan is poised to assume a greater leadership role within the Asian Development Bank (ADB) following key announcements at the institution’s 58th Annual Meeting of the Board of Governors, held on May 6-7 in Milan, Italy. Uzbekistan’s delegation, led by Deputy Prime Minister Jamshid Khodjaev, participated in the high-level event. According to the Ministry of Investments, Industry and Trade of Uzbekistan, the meeting concluded with the formal announcement that Uzbekistan will chair the ADB Board of Governors for the 2025-2026 term. Khodjaev was confirmed as the board’s next chair, a move widely seen as a reflection of the growing trust and confidence of international financial institutions in Uzbekistan’s reform trajectory. Additionally, it was agreed that Samarkand will host the ADB’s 59th Annual Meeting in May 2026. During the Milan meeting, the parties also signed an ambitious cooperation program outlining 23 new projects valued at $3.6 billion, to be implemented over the next two years. These initiatives will target strategic sectors such as education, drinking water supply, transport, and technical assistance. The announcement builds on an existing track record of cooperation. Recent projects include a $125 million ADB loan aimed at modernizing Uzbekistan’s water systems. This initiative encompasses the installation of smart water meters, mapping of water infrastructure, modernization of customer service centers, and training for utility staff, all intended to enhance national water security and service efficiency. Uzbekistan’s expanding partnership with the ADB is expected to accelerate its social and economic development objectives, particularly as the country continues to pursue wide-ranging reforms and infrastructure upgrades.

Central Asia Kazakhstan Lead Story Business & Economy Kazakhstan Kazakhstan Business & Economy

Kazakhstan Launches Dredging Project to Expand Aktau Port on Key Trans-Caspian Corridor

Kazakhstan’s Ministry of Transport has initiated dredging works at the Caspian Sea port of Aktau, aiming to enhance the capacity and navigational safety of a critical hub on the Trans-Caspian International Transport Route (TITR), also known as the Middle Corridor. The Aktau port, located in the Mangistau region, is being deepened by 1.5 to 2 meters using specialized dredging equipment supplied by European contractor Jan De Nul. Mobilization of the equipment is set to be completed in May, with full dredging operations scheduled for completion by the fourth quarter of 2025. The project is expected to significantly increase the port's terminal capacity. Currently, Aktau handles approximately 15 million tons of cargo annually, including up to 140,000 twenty-foot equivalent units (TEUs). This infrastructure enhancement forms part of Kazakhstan’s broader strategy to develop the TITR, a key transit corridor linking China to Europe through Central Asia and the Caucasus. According to the Ministry of Transport, container traffic via the TITR through Kazakhstan surged by 3.5 times in the first quarter of 2025, reaching 25,000 TEUs, up from 7,200 TEUs during the same period in 2024. In a related development, Kazakhstan completed dredging works at another major Caspian port, Kuryk, in November 2024. That project, also executed by Jan De Nul Kazakhstan LLP, was finished in just four months. The water depth at Kuryk was increased to 7-8 meters, substantially enhancing its handling capacity and reinforcing its strategic importance on the Trans-Caspian route.

Central Asia Business & Economy Kazakhstan Kazakhstan Business & Economy

Kazakhstan’s Young Workforce Grows, But Sectoral Gaps Persist

The youth labor market in Kazakhstan remains a vital topic amid the country’s ongoing economic transformation. According to analysts from Finprom.kz, approximately 1.8 million young people aged 15 to 28 were employed across the country in 2024, an increase of 0.6% compared to the previous year. Regional Distribution of Youth Employment The highest concentration of young workers is in Almaty, where 243,200 young people are employed, up 5% from 2023. Almaty is followed by the Turkestan region. In contrast, the Ulytau, North Kazakhstan, and Zhetysu regions recorded the lowest figures for youth employment. Of the total number of employed youth, 1.4 million (77.7%) work as salaried employees. Additionally, the country is home to 331,900 young individual entrepreneurs, 58,300 self-employed workers, 2,700 founders or participants in economic partnerships, joint-stock companies, or cooperatives, and 2,400 engaged in private practice. Sectoral Breakdown Among all employed young people, the largest group, 424,400 individuals, are professionals, although this marks a 1.3% decrease from the previous year. They are followed by service and sales workers (291,700), unskilled laborers (281,700), technical and support staff (195,100), and industrial, construction, and transport workers (142,600). In terms of industry sectors, youth are primarily employed in wholesale and retail trade, automotive repair, education, and agriculture, including forestry and fishing. The lowest youth employment is seen in utilities (water and electricity supply) and real estate. Youth Unemployment: A Gradual Decline Youth unemployment is on the decline. In 2024, the number of unemployed individuals aged 15 to 28 dropped to 62,000, a 6.7% decrease from 2023. The unemployment rate stood at 3.7% among 16 to 24-year-olds and 3% among those aged 25 to 28. For comparison, the overall unemployment rate for the working-age population in Kazakhstan reached 4.7%. Almaty recorded the highest number of unemployed youth (11,100), followed by Astana (7,800) and the Almaty region (7,700). Ulytau, Pavlodar, and North Kazakhstan regions reported the lowest youth unemployment figures. As for the length of time spent job hunting in 2024, 18,200 young people searched for one to three months, 16,200 for three to six months, and 16,000 for less than a month. A smaller share, 7,500, searched for more than six months, and 4,000 had been looking for work for over a year. Broader Context and Causes of Unemployment Nationwide, 448,200 Kazakhstani citizens were unemployed in the fourth quarter of 2024. The unemployment rate was 4.2% among men (211,100) and 5.1% among women (237,100). The most affected age groups were 35 to 54 (256,900 people) and 55 to 64 (69,700). The most frequently cited reasons for unemployment included family responsibilities (61,400), layoffs or company closures (50,300), and difficulty finding suitable jobs (112,500). Other contributing factors were domestic duties (44,200), health issues (17,500), and challenges securing employment post-graduation (16,600). Policy Implications Experts highlight the importance of developing flexible employment policies tailored to the evolving labor market. Enhancing conditions for self-employment and youth entrepreneurship is seen as a potential key strategy for reducing youth unemployment in the long term.