Business & Economy - The Times Of Central Asia

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Industrial Projects

The Industrial Map of Central Asia: Projects That Could Reshape the Region’s Economy

Over the next decade, the countries of Central Asia are preparing to launch a wave of industrial projects: copper mines, gas-chemical complexes, hydropower and nuclear plants, fertilizer factories, and others. The largest initiatives, valued at tens of billions of dollars, could significantly alter the balance of global markets. Uzbekistan: Betting on Metallurgy and Gas Chemistry Uzbekistan has been particularly active in launching new industrial projects. The largest initiative is the $15 billion expansion of the Almalyk Mining and Metallurgical Combine (AMMC), designed to increase copper cathode production from 148,000 to 400,000 tons annually by 2030. This more than two-fold increase is driven by strong global demand for copper. In May 2024, prices exceeded $11,000 per ton due to anticipated shortages linked to the energy transition and rising consumption in green technologies. Copper has become a key metal for electrification, and Uzbekistan’s copper megaproject fits squarely into this global trend, positioning the country as an emerging player in the market. Another strategic direction is the deep processing of natural gas into chemical products. In spring 2024, construction began on a $5 billion methanol-to-olefins gas-chemical complex in Bukhara. The plant, located in the Karakul Free Economic Zone, will process 1.3 billion m³ of gas and 430,000 tons of naphtha per year, producing up to 1.1 million tons of polymers. Completion is expected in 2027. The facility will create 2,000 direct jobs, and about 4,000 more in related industries such as construction materials, textiles, automotive, and electronics. Equipment suppliers include companies from the United States, Germany, and China, and the project is led by Uzbekistan’s largest oil and gas company, Sanoat Energetika Guruhi (Saneg). An even larger $10 billion MTO project is planned for completion by 2028, creating about 3,000 jobs and further expanding polymer production based on methanol. Uzbekistan is also investing in modernizing existing facilities. The $1.8 billion expansion of the Shurtan Gas Chemical Complex is under way, and preparations are being made for the privatization of the $3.4 billion Uzbekistan GTL plant launched in 2021. In renewables, a 250 MW solar power plant with Masdar is being built in Bukhara region with UAE partner Masdar, scheduled to come online by late 2025. Turkmenistan: Fuel, Energy, and the Chemical Industry Turkmenistan, which holds the world’s fourth-largest natural gas reserves, is focusing on export-oriented energy projects and the development of gas-chemical production. A key regional initiative is the TAPI pipeline (Turkmenistan–Afghanistan–Pakistan–India), valued at more than $7 billion. In 2024, work began on the Turkmen segment from Serhetabat on the Afghan border to Herat, forming the central section of the route. TAPI aims to deliver Turkmen gas to South Asian markets and enhance regional energy security. Despite geopolitical challenges, construction continues under the government’s “Arkadag Bright Path” energy development strategy. The country is also expanding its domestic processing capacity. In 2019, Turkmenistan launched the world’s first industrial gas-to-gasoline (GTG) plant in Ovadan Depe, a $1.7 billion facility that converts 1.8 billion m³ of gas into 600,000 tons of A-92 gasoline annually. The fuel...

Transport and Logistics

Bottlenecked: Eurasia’s Freight Lifelines Falter

Amid heightened geopolitical tensions and stricter border regulations, key transit routes linking China and Europe via Kazakhstan and Belarus have experienced severe disruptions. The resulting bottlenecks have exposed the fragility of Eurasian logistics and cast doubt on the reliability of the overland corridors central to China’s Belt and Road Initiative. From Military Maneuvers to Transport Gridlock For over two decades, Kazakhstan has invested heavily in developing its transit potential, aiming to become the main bridge between China and Europe. But in September and October this year, logistical bottlenecks began to appear, chiefly at border crossings. The disruptions were triggered by the closure of Belarusian‑Polish checkpoints following the launch of the Zapad 2025 military exercises (12‑16 September 2025) conducted by Russia and Belarus. On September 12, the day the exercises began, Poland suspended road and rail traffic after drones reportedly entered its airspace. Belarus claimed the drones had veered off course due to electronic warfare measures involving Russia and Ukraine. Despite this explanation, Poland invoked Article 4 of the NATO charter, prompting the alliance to launch Operation Eastern Sentry to bolster its eastern flank. The closure lasted nearly two weeks, during which more than 130 freight trains from China, carrying cargo worth billions of euros, were stranded. The China Factor and Limited Alternatives China responded diplomatically: on 15 September, Foreign Minister Wang Yi held talks in Warsaw; on 22 September, Politburo member Li Xi visited Minsk. Despite these efforts, border reopening was not immediately expedited. Alternative routes proved inadequate. The Trans‑Caspian International Transport Route (Middle Corridor) — through Kazakhstan and the Caspian Sea — is growing but still modest in capacity. In 2022 its potential was assessed at around 80,000 TEU annually. Some forecasts estimate it may rise to 10 million tons per year by 2027, but it remains well short of the volumes handled by the northern rail corridor. According to Logistan, the route currently has a monthly capacity of under 10,000 TEU, far short of the 40,000 TEU demand. The World Bank estimates that upgrading Middle Corridor infrastructure will require $27-$29 billion over 15 years, primarily for rail and port development. Amid these limitations, China tested a new maritime option: in September, an ice-class container vessel departed Ningbo-Zhoushan for the UK via the Northern Sea Route. The move indicates Beijing’s growing interest in Arctic alternatives to land corridors. Kazakhstan-Russia Hubs and “Gray” Transit As disruptions continued on the western flank, issues emerged in the south. Since mid-June, Russian logistics companies have reported delays at Kazakhstan’s border crossings. Kazakhstan’s Ministry of Finance attributed the slowdowns to increased inspections aimed at intercepting counterfeit goods. Forbes reported that roughly 7,000 trucks, carrying Chinese cargo worth hundreds of millions of dollars, were stranded. Many shipments used simplified declarations, often disguised as textiles or raw materials, and sometimes included dual-use items. Despite denials from both Kazakh and Russian authorities, freight companies cited congestion stretching for kilometers. The situation worsened after Russia imposed new migration rules restricting Kazakh drivers to 90 days of stay per year. The Kazakh government...

Retail Industry

Kyrgyzstan to Eliminate Service Charges in Cafes and Restaurants

Kyrgyzstan's Cabinet of Ministers has approved amendments to the regulations governing public catering establishments, effectively banning separate service charges in cafes and restaurants. Beginning January 1, 2026, businesses across the country will no longer be allowed to list service fees, typically 10-15% of the total bill, as a separate line item. Under the new rules, the full cost of service must be incorporated into the listed prices of food and beverages on the menu. According to the Ministry of Economy and Commerce, the reform aims to enhance price transparency and better protect consumer rights. “The consumer must see the final price before placing an order. Information about the cost of services must be transparent, accessible, and understandable,” the ministry stated. While customers may still tip at their discretion, the tipping culture in Kyrgyzstan remains underdeveloped, largely due to the existing practice of automatically including service charges. Authorities expect the new pricing model to gradually shift public attitudes toward discretionary tipping. Government officials emphasized that the primary objective of the reform is to eliminate hidden charges and simplify oversight. “Consumers should understand how much they are paying and what they are paying for. This not only protects citizens’ rights but also streamlines tax control,” the Ministry of Economy and Commerce added. Restaurant and café operators have been urged to adjust their menu pricing and update point-of-sale systems ahead of the new regulation’s implementation. Staff are advised to inform customers about the changes and ensure that menu prices match the final bill.

Economic Growth

Kazakhstan Presents Economic Growth Strategy in Washington

On October 15, Kazakhstan's Deputy Prime Minister Serik Zhumangarin presented the country’s new proactive economic growth strategy to leading American businesses during a roundtable hosted by the U.S.-Kazakhstan Business Council (USKZBC) at the U.S. Chamber of Commerce in Washington, D.C. The meeting served as a key platform for dialogue ahead of the annual meetings of the World Bank and the International Monetary Fund. The U.S. delegation included Khush Choksy, Senior Vice President for the Middle East, Turkey, and Central Asia at the U.S. Chamber of Commerce, along with executives from major corporations such as Chevron, ExxonMobil, Citi, Mastercard, Boeing, Bechtel, and LanzaJet. Zhumangarin highlighted the longstanding commercial ties between the two countries, noting that over 600 American companies currently operate in Kazakhstan, including General Electric, Pfizer, Honeywell, Coca-Cola, and John Deere. “Kazakhstan is an attractive country for American business. Our GDP this year will exceed $330 billion, approximately 60% of Central Asia’s total economy,” Zhumangarin stated, adding that GDP per capita at the end of 2024 surpassed $14,000, and $44,000 in terms of purchasing power parity. The government is aiming to raise total GDP to $450 billion by 2029. Zhumangarin emphasized that Kazakhstan’s financial indicators remain strong, with national debt at about 22.2% of GDP - around $61 billion - a level comparatively lower than in most global economies. Over the past two decades, the country has attracted more than $400 billion in foreign direct investment. According to Zhumangarin, less than one-third of that has gone into the raw materials sector, with the remainder directed to manufacturing, construction, transport, finance, and insurance. Kazakhstan has recorded steady economic growth exceeding 5% for three consecutive years - 5.1% in 2023, 5% in 2024, and 6.3% in the first nine months of 2025. International credit rating agencies S&P, Fitch, and Moody’s have maintained Kazakhstan’s investment-grade ratings, with S&P upgrading its outlook to “Positive” and Moody’s assigning a “Baa1” rating. Zhumangarin outlined a new economic strategy aimed at maintaining annual growth between 5% and 6%. Central to the plan is strengthening development finance institutions and launching large-scale projects in value-added sectors such as raw material processing, agriculture, and mechanical engineering. “The total investment potential of these sectors is estimated at over $100 billion,” he said. Priority industries include railway and automotive manufacturing, fertilizer production, waste processing, and the development of rare earth elements. Energy and municipal infrastructure are also major areas of focus, with projects worth $100 billion planned over the next five years. “We invite leading international companies with deep industry expertise. Their participation will boost production efficiency, generate employment, and reinforce Kazakhstan’s image as a reliable investment destination,” Zhumangarin added. The U.S. Chamber of Commerce, the world’s largest business association, represents over 3 million companies and 830 industry associations. The USKZBC comprises dozens of corporations active in Kazakhstan, including names such as Chevron, ExxonMobil, Fluor, Apple, GE, Bechtel, Boeing, and Mastercard. In 2024, trade between the U.S. and Kazakhstan reached $4.2 billion. More than 720 enterprises with American participation are registered in...

Economic Reforms

World Bank Approves $800 Million Loan for Uzbekistan’s Economic Reforms

The World Bank has approved an $800 million concessional loan package to support Uzbekistan’s ongoing structural reforms, aimed at reducing poverty, creating jobs, and expanding private sector-led growth. The financing is designed to help the government enhance competition, strengthen social protections, and foster a more dynamic economic environment. The financial support will fund a broad set of policy initiatives, including mitigating the impact of energy tariff increases on low-income households, advancing gender equality in the workplace, and expanding access to social services for vulnerable populations. The package also targets reforms in key sectors such as telecommunications, agriculture, and energy, while supporting greater integration of Uzbekistan into global trade networks. With favorable long-term repayment terms, the loan will reduce the country’s debt servicing costs and free up government resources for economic and social development. One of the central measures backed by the package is a significant boost in financial assistance for low-income families. Annual cash transfers per household will increase from UZS 270,000 to UZS 1 million to offset the rising costs of electricity, heating, and gas. The World Bank package will also support legislation to protect women from sexual harassment and workplace discrimination, including safeguards against employment bias related to pregnancy or childcare responsibilities. Reforms will open the provision of social services to private and non-governmental organizations, enabling greater coverage and efficiency. Among other key initiatives is the establishment of a National Investment Fund to manage and privatize state-owned enterprises. The creation of an independent telecommunications regulator is expected to promote competition, while new agricultural risk insurance schemes and liberalized cotton pricing aim to strengthen resilience and market access for farmers. Textile companies will be permitted to buy cotton directly from producers at flexible prices. The reform agenda also focuses on trade liberalization, including the removal of exclusive rights in strategic sectors such as energy, oil and gas, and agriculture. Export procedures will be simplified, and new regulations will promote private participation in electricity distribution and allow renewable energy producers to sell directly to consumers. Energy efficiency and climate policy are integral to the package. Uzbekistan plans to establish a National Energy Efficiency Agency and introduce incentives for solar power, heat pumps, and energy-efficient building retrofits. Public procurement processes will incorporate environmental criteria to support sustainable products and services. According to a World Bank report released in July, Uzbekistan’s economy grew steadily between 2010 and 2022, with per capita GDP rising by an average of 4.2% a year, outpacing the regional average. However, the report noted that growth has relied heavily on capital investment rather than productivity gains, and that deeper reforms are needed to build a more competitive private sector.

Moody's Ratings

Moody’s Assigns Kyrgyzstan First-Ever Positive Outlook

For the first time, international credit rating agency Moody’s has assigned Kyrgyzstan a positive outlook, while reaffirming the country’s sovereign credit rating at B3. According to the Ministry of Finance, the shift reflects Kyrgyzstan’s stable economic growth. Finance Minister Almaz Baketaev met with Moody’s Managing Director David Aldrich on the eve of the announcement. Discussions covered areas of future cooperation, Kyrgyzstan’s investment profile, strategies for attracting external financing, and the country's credit trajectory. “Moody’s has revised its outlook on the Kyrgyz Republic’s sovereign credit rating from stable to positive, confirming the long-term rating at B3. The economy is demonstrating steady growth: real GDP for January to July 2025 rose by 11.5%,” the Ministry of Finance stated. “In May 2025, Kyrgyzstan successfully issued its first Eurobonds, raising $700 million. Investor demand exceeded supply threefold, with a five-year maturity and a 7.75% coupon rate.” The ministry noted that all proceeds from the Eurobond issuance have been placed in a dedicated account to manage public debt responsibly. Kyrgyzstan’s B3 rating has remained unchanged in recent years. While Moody’s upgraded the country’s outlook from negative to stable in 2024, this year marks the first time the outlook has been revised to positive. The Ministry of Economy described the revised outlook as recognition of the government’s efforts to stabilize and grow the economy. “The updated forecast reflects improvements in Kyrgyzstan’s macroeconomic and fiscal indicators, as well as stronger long-term development potential,” the ministry noted. “These results stem from key reforms, economic diversification, and sustained infrastructure investment.” According to official figures, all sectors of the economy posted growth in the first half of 2025. Construction recorded the highest increase at 45% since the start of the year, while agriculture saw the most modest growth at 3.8%. Total GDP for the first six months of the year amounted to 711 billion soms.