Business & Economy - The Times Of Central Asia

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Economic Growth

EBRD Names Tajikistan One of Central Asia’s Fastest-Growing Economies

Tajikistan continues to record one of the strongest economic growth rates in Central Asia, according to the European Bank for Reconstruction and Development (EBRD) in its June 2026 Regional Economic Prospects report. The EBRD estimates that Tajikistan’s economy grew by 8% year-on-year in the first quarter of 2026, supported by growth in trade, transport and communications, along with strong manufacturing growth and higher electricity generation. Fixed capital investment rose by 34.2% in the first quarter compared with the same period last year, one of the strongest performances in the region. For comparison, fixed capital investment in neighboring Kyrgyzstan rose by 25.5% during the same period, while Kazakhstan recorded growth of 6.4%. The bank attributed Tajikistan’s strong investment activity partly to public spending commitments, including the Rogun hydropower project, one of the country’s flagship infrastructure developments. Once completed, Rogun is expected to become a key part of Tajikistan’s power system and a major source of electricity exports to neighboring countries. The EBRD also noted strong growth in manufacturing, which increased by 29.6% year-on-year in January-March 2026. Electricity generation rose by 7.5%, while mining output contracted by 9.8%. Officials at Tajikistan’s State Committee on Investment and State Property Management said the figures reflect sustained interest in the country’s economy and create additional opportunities to attract domestic and foreign investors into priority sectors. Tajikistan has increasingly positioned itself as a regional energy hub, particularly through hydropower. As previously reported by The Times of Central Asia, the country has the largest hydropower potential in Central Asia. Tajikistan’s annual hydropower potential is estimated at 527 billion kilowatt-hours, while the country accounts for a large share of Central Asia’s water resources. Despite that, much of its hydropower capacity remains untapped. International industry estimates suggest that only around 4% of Tajikistan’s hydropower potential has been developed, leaving significant room for future investment and expansion.

Coal

Kazakhstan Coal Exports Hit 7 Million Tons in Q1 2026

Kazakhstan coal exports reached 7.1 million tons in the first three months of 2026, while the domestic market remained the primary destination for the country’s coal producers, Nikolai Radostovets, executive director of the Republican Association of Mining and Metallurgical Enterprises, said at the VII Coal Industry Forum. Energy Ministry figures have put Kazakhstan’s 2025 coal production at around 115.9 million tons. Of that amount, 85.9 million tons were supplied to the domestic market, including the housing and utilities sector and thermal power plants, while exports amounted to 30 million tons. Kazakhstan’s main coal export destinations remain Russia, Poland, Uzbekistan, Turkey, India, and Malaysia, Radostovets told participants at the Coal Industry Forum, held as part of the Astana Mining & Metallurgy Congress, AMM 2026. Coal output is expected to rise this year to 128.9 million tons. In January-March, nearly 29 million tons of coal were mined, while exports reached 7.1 million tons, according to industry association data. “One of the key tasks for the industry remains ensuring stable supply to the domestic market, including thermal power plants and the housing and utilities sector,” Radostovets said, whilst also stressing that exports remain a crucial part of the sector’s sustainability. “Exports ensure workload for enterprises, foreign currency earnings, tax revenues and stable production programs. Domestic needs are always prioritized, but exports help maintain overall production levels and the financial sustainability of enterprises,” he said. He also warned that Kazakhstan’s coal exports face mounting transportation risks linked to geopolitical shifts across Eurasia, as well as insufficient capacity in regional logistics infrastructure. To preserve export potential, Radostovets said Kazakhstan needs more predictable tariff-setting by transport operators, expanded alternative logistics routes, improved efficiency at the Caspian ports of Aktau and Kuryk, and stronger intergovernmental coordination on transit issues. Meanwhile, Kazakhstan’s Energy Minister Yerlan Akkenzhenov sought to reassure coal producers that domestic demand for their products is likely to grow in the coming years as the government expands coal-fired power generation. “Against the backdrop of rising electricity consumption, industrial growth and the development of the digital economy, reliable baseload generation is becoming increasingly important. In this regard, the government has approved the national project ‘Development of Coal Generation,’” Akkenzhenov said. The program covers 2026-2030 and provides for the construction of new energy facilities, while expanding or modernizing existing installations. This is expected to create additional demand for around 20 million tons of thermal coal per year by 2030. Kazakhstan’s renewed emphasis on coal reflects a wider tension in its energy policy. The government is seeking a route out of electricity shortages and provide reliable baseload generation for industry, data centers, and other energy-intensive sectors, while also maintaining its formal target of achieving carbon neutrality by 2060. Officials have argued that new coal capacity will be paired with cleaner technologies and modern emissions controls, but the scale of the planned expansion underlines how central coal remains to Kazakhstan’s power system. The national project includes eight new coal-generation facilities, including major projects in Ekibastuz, Kurchatov, and Zhezkazgan, as well...

FinTech

Uzbekistan to Host Inaugural Silk Road Finance & Technology Forum in August

Uzbekistan is set to host the inaugural Silk Road Finance and Technology Forum in August, a new international event aimed at advancing the country’s role as a regional hub for financial technology and innovation. According to a joint announcement by the Central Bank of Uzbekistan and the Global Finance & Technology Network (GFTN), the forum will take place in Tashkent from August 24 to 26, 2026. The event will be held at Central Asian Expo Uzbekistan and the Islamic Civilization Centre. It is expected to bring together policymakers, regulators, investors, entrepreneurs, and technology leaders from Central Asia and beyond. The organizers describe the forum as Uzbekistan’s flagship platform for discussions on finance, innovation, and public policy. It is being launched as the country pursues an ambitious strategy to become a leading fintech center in the region. Uzbekistan’s financial technology sector has expanded rapidly in recent years, driven by growing digital adoption and a young population of more than 37 million people. According to the organizers, nearly 70% of the population now uses digital services, creating favorable conditions for the development of financial technologies. The forum comes as Uzbekistan implements a presidential strategy for the sector through 2030. The plan includes attracting $1 billion in foreign investment, training more than 5,000 specialists, licensing more than 200 market participants, supporting more than 100 startup graduates from incubation programs, and testing digital currencies and stable tokens. The Central Bank has also announced plans to expand the country’s financial innovation infrastructure. These initiatives include the creation of a globally accessible Regulatory Sandbox 2.0, the Q-FINEX Quantum Finance Testbed, and a dedicated $50 million venture fund for fintech development. Authorities are also working on regulatory frameworks covering open banking, digital payments, buy now, pay later services, and cybersecurity resilience. The three-day forum will be organized around five main themes: open banking, digital assets and stablecoins, cross-border payments, Islamic finance, and innovation and investment. The event’s theme, “Al-Jabr,” references the Arabic concept of “bringing parts together,” which gave rise to algebra, and honors the legacy of the ninth-century scholar Al-Khwarizmi, who was born in Khwarezm, in present-day Uzbekistan. Organizers say the theme points to the forum’s goal of linking finance with technology policy. The forum is being co-hosted with Ant International and joins GFTN’s global network of events, which includes the Singapore FinTech Festival, the Point Zero Forum in Zurich, GFTN Forum Japan, and the Black Swan Summits. “Innovation flourishes when trust, talent and capital converge,” said Sopnendu Mohanty, group CEO of GFTN. He said the forum would help connect global expertise with regional ambitions and support Central Asia’s emergence as a center for financial innovation. GFTN is a Singapore-based not-for-profit organization established by the Monetary Authority of Singapore in 2024. It promotes financial innovation and inclusion through partnerships with public- and private-sector institutions.

AMM 2026

U.S. Investors Show Growing Interest in Kazakhstan’s Mining Sector

U.S. investors are showing growing interest in Kazakhstan’s critical minerals sector, with attention increasingly focused not only on extraction but also on processing, metallurgy and broader supply-chain development, according to Nicole Rodgers, president of the U.S.-based Alliance for Mineral Security, an industry group representing companies involved in mining, processing and the use of strategic minerals. Rodgers spoke during the panel session “Investment Climate in Mining and Metallurgy” at the Astana Mining & Metallurgy Congress, AMM 2026, where she emphasized that predictability and regulatory consistency are among the most important conditions for attracting global capital. “In our view, Kazakhstan is moving in the right direction, including by harmonizing regulations with international standards, developing early-stage geological exploration, building industrial clusters and moving toward more sophisticated investment structures,” Rodgers said. “At the same time, American investors are interested not only in extraction, but in participating across the entire value chain.” She pointed to an agreement between U.S.-based Cove Capital and Kazakhstan’s national mining company Tau-Ken Samruk on the joint development of the Severny Katpar and Verkhne Kairakty tungsten deposits in the Karaganda region of central Kazakhstan. Under the deal, the investment package includes plans to build two processing plants and a metallurgical facility, with a total projected value of $1.1 billion. Interest from Washington has also been reinforced at the political level. Speaking at the C5+1 Critical Minerals Dialogue in June, U.S. Special Envoy for South and Central Asia Sergio Gor said Washington intended to play an active role in developing Central Asia’s mining sectors. “Interest in Kazakhstan from American investors is high, but for that interest to materialize in practice, infrastructure, energy capacity and skilled personnel are critical,” Rodgers added. While foreign interest is rising, industry representatives said Kazakhstan’s ability to convert that interest into long-term investment will depend on the consistency of its legal and regulatory framework. Nikolai Radostovets, executive director of the Republican Association of Mining and Metallurgical Enterprises, said amendments to Kazakhstan’s Subsoil Code, adopted in 2018, should now be aligned with changes in environmental, water and land legislation introduced in recent years. Ruslan Baimishev, president of the Kazakhstan Mining Chamber, also highlighted the importance of legislative stability, particularly in tax policy, saying investors require consistency in government decisions. World Bank Senior Mining Specialist Remy Pelon said many countries are reforming their mining sectors to meet growing demand for minerals needed for the global energy transition. At the same time, Pelon warned against overcorrection. “Governments must create conditions for the efficient use of mineral resources in the interests of national development, but it is equally important to preserve a balance between industrial policy, openness to new market players and competitiveness,” he said. “That balance is especially important for countries aiming not only to extract raw materials, but also to develop processing, local manufacturing and technological expertise.” Kazakh officials used the forum to underscore recent legal measures designed to improve investor protections. Arman Khassenov, deputy chairman of the Committee for the Protection of Investors’ Rights under the Prosecutor General’s Office,...

Pensions

A History of Kazakhstan Pension Reforms: Between Market and Monopoly

Kazakhstanis rushed to withdraw pension savings in May ahead of a sharp increase in the minimum balances required to access their funds, in what may prove to be the final major wave of early withdrawals from the country’s state-run pension system. According to local financial outlet Kapital.kz, the Unified Accumulative Pension Fund (UAPF) processed 119,100 applications for one-time pension withdrawals for housing in May, twice as many as in April. The withdrawals totaled 117.8 billion tenge, roughly $240 million. The surge came shortly before new “minimum sufficiency thresholds” were published in early June, which will make early access to pension savings difficult for most working-age contributors. The change has reopened a wider debate over Kazakhstan’s pension system, which has undergone several transformations over the past quarter century. From a bold market experiment in the late 1990s, to a rigid state monopoly, and now back to a tightly regulated market model, the system has long struggled to balance the protection of citizens’ retirement savings with the need to generate investment returns. How Kazakhstan Got Here: The Private Market Experiment, 1998-2013 Before 1998, Kazakhstan operated a solidarity pension system, under which the state paid pensions from current revenues without maintaining individual retirement accounts. Pension payments depended mainly on length of service and salary level. The economic crisis that followed independence forced the government to change course. On January 1, 1998, Kazakhstan became the first post-Soviet country to adopt a funded pension model inspired by Chile’s system. It created a multi-tiered framework based on mandatory individual contributions equal to 10% of income, alongside a state-funded basic pension. The idea was straightforward: private pension funds would act as institutional investors, channeling billions into the economy while generating sustainable returns for contributors. For a time, the model was seen as one of the most ambitious financial reforms in Central Asia. But over the following years, serious flaws became increasingly clear. Eventually, the government itself acknowledged that the experiment had failed. Regulators identified several core problems. The first was negative real returns. Pension funds consistently underperformed inflation. Average annual returns stood at only 2.2%, while inflation averaged 6.8%, meaning citizens’ savings steadily lost purchasing power. The second was toxic assets. In pursuit of higher yields, pension funds invested heavily in opaque corporate securities. Of the 38 major issuers financed with pension money, 32 later went bankrupt, resulting in substantial write-offs borne by contributors. The third was high management fees. Private fund managers charged substantial commissions even during periods of poor performance or losses. Later audits found that many of these fees had been used to finance inflated executive salaries and bonuses. By the summer of 2013, the government had begun dismantling the private pension model. From Private Funds to State Monopoly, 2013-2020 By autumn 2013, all pension accounts from private funds had been transferred to the UAPF, which came under the management of the National Bank of Kazakhstan. The state monopoly addressed one major issue: the preservation of capital. But it also created a new institutional...

Middle Corridor

Kyrgyzstan and Georgia Seek Black Sea Link for CKU Railway

Kyrgyzstan and Georgia placed Black Sea access at the center of their transport agenda during Georgian Prime Minister Irakli Kobakhidze's official visit to Bishkek on June 11-13. In talks with President Sadyr Japarov at Yntymak Ordo, the new presidential palace complex, on June 12, the two sides linked their cooperation to the China-Kyrgyzstan-Uzbekistan railway, known as CKU, and to Georgia's role in the Trans-Caspian route between Central Asia and Europe. The visit was the first official trip to Kyrgyzstan by a Georgian head of government since the two states established diplomatic relations 34 years ago. "Special attention was paid to linking the China-Kyrgyzstan-Uzbekistan railway with Georgia's port infrastructure," Japarov said after the talks. He called cooperation in this sector "one of the priority areas" in relations between the countries. That focus gave the visit a wider regional dimension, as landlocked Kyrgyzstan still lacks a direct rail link with China. Georgia offers access to Black Sea ports and sits on the South Caucasus section of the Middle Corridor. If the CKU line becomes operational, Bishkek wants cargo moving from China through Kyrgyzstan and Uzbekistan to connect with routes across the Caspian Sea, Azerbaijan, and Georgia. Kobakhidze linked the same issue to Tbilisi's transit goals. "We emphasized the importance of developing the Middle Corridor," he said, adding that the route needs more cargo flows. He said Georgia was closely following the CKU and was pleased that the project was "progressing rapidly," because it would strengthen links between Central Asia and the South Caucasus. The two sides signed a joint statement and a package of bilateral documents after the talks. The agreements covered aviation authorities, state property management, veterinary cooperation, education, justice, sport, radiation safety, foreign ministry cooperation for 2027-2028, and customs cooperation. The customs document provides for advance exchanges of information about goods and vehicles moving between the two countries. That aspect may prove the most practical for freight, since cargo routes depend on data exchange, border processing, and predictable clearance times. The CKU railway has moved from a decades-long plan to active construction. The financing agreement signed in Bishkek set the project cost at $4.7 billion. About half will be financed through a 35-year Chinese loan to the joint project company. China holds a 51% stake in the company, while Kyrgyzstan and Uzbekistan each hold 24.5%. The planned line runs from Kashgar in China through Kyrgyzstan to Andijan in Uzbekistan. The Kyrgyz section represents the most difficult part of the route. It is about 305 kilometers long, with 50 bridges and 29 tunnels planned. More than 5,000 people and about 5,600 pieces of specialized equipment were involved by late March, with tunnel excavation, earthworks, and bridge construction already under way. Transport Minister Talantbek Soltobaev said on June 10 that work was in progress on sections totaling up to ten kilometers. Japarov has outlined 2030 as a target for the launch. The project would give Bishkek a rail role it has never had. Kyrgyzstan has no through rail route linking China with...