Kazakhstan Business & Economy - The Times Of Central Asia

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Regional Trade

Central Asia and Azerbaijan Discuss Trade Expansion at Turkmenistan Summit

The leaders of Central Asia and Azerbaijan met in Turkmenistan on October 8, with expanding trade between their countries high on the agenda. Kazakhstan's President Kassym-Jomart Tokayev called for trade among the six countries to rise to at least $20 billion, up from approximately $13 billion in 2025. The eighth Consultative Meeting of the Heads of State of Central Asia and Azerbaijan was held in the resort of Avaza, with Azerbaijan participating as a full member of the grouping for the first time. According to Tokayev, trade between the six countries accounted for just 8% of their combined trade turnover last year. He proposed that governments develop a joint action plan to increase that share. Other leaders put forward proposals for closer economic ties. Uzbekistan's President Shavkat Mirziyoyev called for greater cooperation in manufacturing and a Central Asia-Azerbaijan Business Forum in 2027, while Kyrgyzstan's President Sadyr Japarov proposed creating a shared e-commerce platform to make regional products more accessible. One problem is the insufficient integration of national markets. Even where countries share a border, trade is hampered by logistical constraints and differences in business operating conditions. Tokayev proposed bringing existing and planned cross-border trade and logistics complexes and industrial centers into a single network. The idea is to enable businesses from different countries to sell finished products to one another and produce them jointly. However, Kazakhstan's major transport projects are not designed solely for its neighbors. Astana is investing in railways and highways to increase freight transit between China, Central Asia, and Europe. The projects include the Moyynty–Kyzylzhar, Darbaza–Maktaaral, and Bakhty–Ayagoz railway lines, as well as the Aral–Caspian highway project. The Middle Corridor holds a particularly important place in these plans, running from China through Kazakhstan, the Caspian Sea, Azerbaijan, and Georgia to Europe. It allows freight to bypass Russian territory and is viewed as an alternative to traditional northern routes. Kazakhstan is now proposing to explore linking the Middle Corridor with the Trump Route for International Peace and Prosperity (TRIPP), a transport project through Armenia intended to connect mainland Azerbaijan with Nakhchivan. Plans for the route were outlined during talks in Washington in August 2025, and Armenia and the United States signed a framework agreement in June 2026. The route is to remain under Armenian sovereignty and jurisdiction. Astana has already established a technical group to assess its potential participation in TRIPP. For now, Tokayev is proposing that the integration of the two transport initiatives be discussed only at the expert level. At the Avaza summit, Turkmen President Serdar Berdimuhamedov emphasized the importance of developing North–South transport corridors alongside East–West routes. Turkmenistan also supports the eastern branch of the International North–South Transport Corridor, which connects Russia with Iran through Kazakhstan and Turkmenistan. However, an increase in freight traffic through Central Asia does not in itself mean that trade among its countries will grow. For that to happen, local producers need access to neighboring markets. The summit also addressed cooperation over shared water resources, with Tokayev proposing a regional framework...

Bilateral Trade

West2West: Kazakhstan Adds a Regional Dimension to Trade with Afghanistan

In late September, a Kazakhstani official and business delegation led by Yerkin Tukumov, the Special Representative of the President of Kazakhstan for Afghanistan, visited Herat. The delegation included trade officials, representatives of the Mangystau and West Kazakhstan regions, and businesses. Officials called the new approach West2West, meaning cooperation between Kazakhstan's western regions and western Afghanistan. Kazakhstan and Afghanistan have held several business forums and exhibitions in recent years. However, the choice of Herat and the attempt to shift some cooperation from the intergovernmental to the interregional level make this initiative different. Since 2021, Kazakhstan’s economic dialogue with Afghanistan has developed mainly from the top down. The two governments set ambitious trade targets and sought to turn political engagement into commercial deals. The results looked impressive on paper. In October 2024, the two countries adopted a road map to raise mutual trade to $3 billion. In April 2025, documents worth $140 million were signed in Kabul, followed by 15 documents worth $303 million in Shymkent that October. Actual trade, however, grew much more slowly. In 2024, it totaled $545.2 million, while in 2025 it slipped slightly to $541.6 million. The $3 billion target remains more of a strategic benchmark than a near-term goal. According to official data from Kazakhstan, trade reached $581.1 million in January-July 2026, exceeding the total for the entire previous year. Kazakhstan’s exports accounted for $572.9 million, while imports from Afghanistan were just $8.2 million. Trade is therefore growing rapidly, but remains overwhelmingly one-sided. West2West is partly an attempt to broaden that relationship. Herat's Strategic Location Herat is one of Afghanistan’s main industrial and commercial centers, situated near several important transport routes. To the north is Torghundi, a rail border crossing with Turkmenistan. To the west runs the Khaf-Herat railway, which connects Afghanistan to Iran’s railway system. Herat could eventually become part of longer routes toward Kandahar and Pakistan, although much of the necessary infrastructure remains at the planning stage. During the September visit, officials opened a 43-kilometer section of the Khaf-Herat railway. Afghan sources estimate its cost at approximately $58 million. The section was built with the involvement of Kazakhstani company Integra Construction KZ. In August 2026, freight transported along the Khaf-Herat line totaled approximately 137,700 metric tons. Discussions have also focused on increasing its monthly capacity to 150,000 metric tons. Together with Uzbekistan and the United Arab Emirates, Kazakhstan has begun working on the Central Asia–South Asia railway project, which envisages a trans-Afghan connection to Pakistan’s ports. So far, the parties have agreed to conduct technical and economic studies, and no final route has been approved. The route through Turkmenistan is developing separately. Ashgabat views Torghundi-Herat as a joint project with Afghanistan linked to the expansion of the Serhetabat-Torghundi crossing and other infrastructure in western Afghanistan. Kazakhstan’s interest in Herat predates West2West. In 2023, Astana announced plans to establish a Kazakhstan Trade House in Afghanistan, with its main office in Herat. It opened in May 2024. Arman Yessentayev, its head, described Herat in 2023 as a...

Declaration AI

Kazakhstan Signs Declaration on Human Oversight of AI at Work

Kazakhstan's government, employers, and trade unions signed a declaration on October 7 calling for human oversight of artificial intelligence in the workplace. The declaration was adopted in Astana at the international forum “Digital Labor and Artificial Intelligence.” It states that decisions affecting workers’ rights and interests should involve a human decision-maker rather than be left entirely to AI. Federation of Trade Unions chairman Satybaldy Dauletalin said employers should remain accountable for decisions made using algorithms. Workers should be able to challenge those decisions and request human review, he said. The federation said the signatories agreed to establish a national forum for cooperation on digital labor and AI. Working groups and a monitoring system would support implementation. Some protections already exist under Kazakh law. The country's AI legislation, which took effect in January 2026, establishes requirements for transparency and human autonomy in AI systems. The Digital Code, effective since July, also gives people the right, under certain conditions, to seek explanations of fully automated decisions and request human review when those decisions affect their rights. The European Union's 2024 Platform Work Directive sets specific requirements for algorithmic management on digital labor platforms. It requires human oversight of automated systems, including human decisions on the dismissal or suspension of workers. Member states have until December 2026 to implement the directive. Meanwhile, Kazakhstan is already using AI in its public employment services. In the Mangystau and Pavlodar regions, an automated job-matching system sent approximately 59,000 personalized vacancy notifications over two months. Deputy Labor Minister Bakhtiyar Zhazykpayev said about 3,000 people had found employment. Those figures alone do not establish how many found work directly because of the system. The federation’s published account does not explain whether the declaration creates additional enforceable obligations for employers or a new complaints procedure for workers.

Bilateral Relations

Tokayev and UK Trade Minister Discuss Investment, Energy and AI Cooperation

Kazakh President Kassym-Jomart Tokayev met with UK Minister of State for Trade Lord Anas Sarwar in Astana on October 7 to discuss cooperation in energy, transport and logistics, digitalization and artificial intelligence. Tokayev said the United Kingdom remains one of Kazakhstan’s leading trade and investment partners. Bilateral trade rose by 83% in 2025 to more than $1.6 billion, according to the Kazakh presidency. More than 500 British companies operate in the country. The commercial relationship has long been anchored partly in energy. British energy major Shell holds stakes in the Karachaganak and Kashagan projects, and in March signed a new exploration contract in Kazakhstan’s Aktobe region. “Kazakhstan and the United Kingdom are connected by constructive political dialogue and active engagement at various levels,” Tokayev said, adding that there was significant scope to expand cooperation further. The talks come several months after Kazakhstan ratified a Strategic Partnership and Cooperation Agreement with the United Kingdom covering trade, investment, energy, critical minerals, education and other areas. The agreement was originally signed in Astana in 2024. Sarwar welcomed the development of the strategic partnership and thanked Tokayev for supporting British business projects and creating a favorable investment climate. “We are following Kazakhstan’s dynamic development with great interest and highly value the similarity of our approaches to key issues on the international agenda,” Sarwar said. He said Britain wanted its partnership with Kazakhstan to deliver concrete results, citing innovation and free trade as shared priorities. Critical minerals have emerged as one area of more practical cooperation. At the inaugural CA5+UK ministerial meeting in London in February, Kazakhstan and Britain agreed on a critical minerals roadmap through 2027. Existing cooperation includes a rhenium project involving Kazakhstan’s Zhezkazganredmet and British company Maritime House. The October 7 presidential readout did not announce any new agreements or investment commitments. The two sides also discussed academic exchanges and joint educational initiatives. British universities have established a growing presence in Kazakhstan, including Cardiff University’s campus in Astana, which opened in September 2025 as the university’s first overseas branch campus. Tokayev encouraged young Kazakhs to study foreign languages, particularly English. “Developing trade and economic ties requires not only new projects and investment, but also people capable of working confidently in an international environment,” Tokayev said. Tokayev also invited British Prime Minister Andy Burnham to visit Kazakhstan.

Bank Membership

Oman Set to Join Eurasian Development Bank as First Gulf Shareholder

Oman is set to become the eighth shareholder of the Eurasian Development Bank (EDB) and the first Gulf state to join the institution. An agreement was signed in Astana on October 6 during Sultan Haitham bin Tarik Al Said’s state visit to Kazakhstan. The EDB’s current shareholders are Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Uzbekistan. Oman would become the first member from outside the former Soviet Union. The agreement, signed by Omani Finance Minister Sultan bin Salim Al Habsi and EDB Chairman Nikolai Podguzov, sets out the terms of the EDB’s operations in Oman. “This agreement reflects our shared intention to build a bridge between Central Asia and the Gulf region,” Podguzov said. Russia remains the bank’s largest shareholder, although its stake was reduced from about 66% to 44.8% in 2023. By the end of June 2026, the EDB’s cumulative portfolio comprised 348 projects with total investment of $22.1 billion. The bank finances projects including transport infrastructure, energy, and digital systems. On October 6, Kazakhstan and Oman signed an agreement on the mutual protection of investments, while Samruk-Kazyna and the Oman Investment Authority agreed to establish a joint investment vehicle to finance projects. As a landlocked country, Kazakhstan is seeking additional routes to the Indian Ocean, and the two sides discussed using Omani ports to transport its goods. Oman has proposed developing a trade corridor through its seaports. The talks in Astana also covered direct air links and other logistics projects. Kazakhstan is seeking to increase exports of grain, meat, and other agricultural products to Oman. In 2025, honey from Kazakhstan was exported to the sultanate for the first time. On October 5, the two countries’ chambers of commerce signed a memorandum aimed at expanding business ties, including in agriculture and logistics. Founded by Kazakhstan and Russia in 2006, the EDB has gradually expanded its membership, most recently with Uzbekistan in 2025.

Oil Exports

Kazakhstan Weighs a Second Major Oil Export Route

Following repeated disruptions to the Caspian Pipeline Consortium (CPC) system, Kazakhstan’s leading oil producers are examining a much larger Trans-Caspian export route. A working group representing eight shareholders responsible for production in the Tengiz and Kashagan fields has commissioned a feasibility study for moving crude from the Atyrau area to Aktau, across the Caspian to Baku, and onward through the Baku–Tbilisi–Ceyhan (BTC) pipeline. The study is expected to go to shareholders in November. The current proposal follows a policy line set out in July 2022, when President Kassym-Jomart Tokayev identified the Trans-Caspian route as a priority and instructed KazMunayGas to examine options, including possible participation by Tengiz investors. The present study puts a much larger export channel under commercial examination. CPC remains indispensable, carrying more than four-fifths of Kazakhstan’s oil exports. Of the 78.7 million tons of oil that Kazakhstan exported in 2025, 64.8 million went through CPC. Existing alternatives are small by comparison. Even the eastbound flow to China and the Schwedt route through Russia together absorb only a fraction of CPC volumes, while current Trans-Caspian shipments are smaller still. What has changed is the cost of concentrating so much of Kazakhstan’s oil exports on CPC, not its underlying commercial importance. The producers are in fact studying two alternatives, a subsea pipeline or a much larger tanker fleet. The Trans-Caspian pipeline idea itself is not new. Variants surfaced in 2009 and appeared again in 2016. What is new is the present combination of shareholder sponsorship, operational urgency, and contemplated scale. Each option is intended to support volumes of up to 35 million metric tons a year. KazMunayGas (KMG) moved 1.3 million tons from Aktau toward BTC in 2025, while its agreement with SOCAR provides for a phased increase to 2.2 million tons annually. The shareholder proposal would expand the existing Trans-Caspian route into a second major export channel. Why Redundancy Now Repeated interruptions in CPC flows have converted the risks of route concentration into lost oil production and a lower national production target. In July, for example, attacks struck tankers loading or approaching the CPC marine terminal, repeatedly suspending operations. Energy Minister Yerlan Akkenzhenov later put production lost to January, June, and July disruptions at about 3.5 million tons and reduced the 2026 production target from 98 million to 96 million tons. Even temporary interruptions reduce revenues and force urgent production decisions upstream. A Trans-Caspian route capable of carrying 35 million tons a year would not replace CPC, but it would materially reduce Kazakhstan’s exposure to a prolonged interruption. The reported figure equals more than half the 64.8 million tons exported through CPC in 2025 and is almost sixteen times the 2.2-million-ton level contemplated under the existing KMG–SOCAR expansion agreement. It would allow Kazakhstan to divert a substantially larger share of production during disruptions. Kazakhstan can now reroute one or two million tons relatively quickly, but not the tens of millions carried through CPC. The first constraint is inside Kazakhstan. Tengiz and Kashagan lack a high-volume pipeline connection to...