Kazakhstan Business & Economy - The Times Of Central Asia

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Critical Minerals

Kazakhstan and South Korea to Establish Rare Metals Research Center in Almaty

Kazakhstan and South Korea are establishing a joint research and technology center in Almaty to support the development of Kazakhstan’s rare metals and critical minerals industry. The Kazakh-Korean Center for Rare and Rare Earth Metals will be established at Satbayev University in partnership with the Korea Institute of Industrial Technology and the Korea National Institute of Rare Metals. During a meeting on July 9, representatives of the three institutions discussed how the project will be carried out. They also reviewed the purchase of modern laboratory equipment and long-term scientific and technological cooperation. The center will train specialists for Kazakhstan’s growing rare metals industry and give local researchers access to modern analytical and processing equipment. It will also support joint research with international partners. “The combined scientific potential of Kazakhstan and the Republic of Korea will enable the implementation of modern technologies for processing strategic raw materials, expand scientific research, and train world-class specialists,” Satbayev University Rector Meiram Begentayev said. According to the university, the facility will become Kazakhstan’s first full-cycle scientific and technological platform dedicated to developing, testing, and commercializing environmentally friendly technologies for the production of high-purity and ultra-high-purity rare and rare earth metals. The center will also conduct fundamental and applied research and pilot new technologies for processing mineral and industrial raw materials. The initiative is part of Kazakhstan’s effort to become a major supplier of critical minerals. Demand is rising from electric vehicle makers and renewable energy companies, while semiconductor and defense industries are also increasing their need for rare metals. Speaking at the C5+1 Critical Minerals Dialogue in Astana on June 10, Minister of Industry and Construction Yersaiyn Nagaspayev described critical minerals as a strategic priority for Kazakhstan’s industrial policy and long-term economic development. He said the country has more than 9,500 mineral deposits, including over 100 containing rare and rare earth metals. Nagaspayev has previously said Kazakhstan is capable of supplying 19 of the 50 critical raw materials identified by the United States and 21 of the 34 minerals included on the European Union’s critical raw materials list, positioning the country as an increasingly important participant in global supply chains. Kazakhstan already produces strategic materials including beryllium, titanium, tantalum, niobium, rhenium, antimony, bismuth, selenium, and tellurium, both as primary metals and as components used in advanced industrial applications.

Energy Investment

Kazakhstan’s Energy Sector Without Local Business: The Anatomy of Major Projects

In late June 2026, construction began on a 1 GW wind power plant in Kazakhstan’s Zhambyl Region. The project is valued at $1.4 billion. Companies based in the United Arab Emirates, Masdar and W Solar, hold 80% of the project, while Kazakhstan’s quasi-state sector holds the remaining 20% through Qazaq Green Power and the Kazakhstan Investment Development Fund. This ownership model has become typical across Kazakhstan’s energy industry. Nearly all major new energy infrastructure projects rely on foreign capital. The country’s largest renewable energy developments involve international investors, including France’s TotalEnergies and Saudi Arabia’s ACWA Power. Even when agreements collapse, the government continues to rely on foreign partners. After financing problems ended cooperation with Russia’s Inter RAO, construction of new thermal power plants in Semey and Ust-Kamenogorsk was quickly reassigned to a Kazakh-Singapore consortium. A similar pattern appears across the sector: foreign investors provide most of the capital and technology, while Kazakhstan’s state-linked companies take minority stakes through Samruk-Kazyna or its subsidiaries This has created an unusual situation. Despite an acute shortage of generating capacity and guaranteed long-term demand, Kazakhstan’s largest private businesses have largely stayed away from electricity generation. Instead, domestic capital continues to favor sectors with greater liquidity and shorter investment horizons, ranging from finance to residential real estate. The reasons lie in straightforward economics, where financing costs and regulatory conditions outweigh the sector’s potential returns. The Financial Equation Power generation is one of the most capital-intensive infrastructure industries, with investment payback periods typically ranging from 10 to 15 years. Such projects require access to long-term financing at low interest rates. For Kazakhstan’s private sector, those financing instruments are largely unavailable. Under the National Bank’s tight monetary policy, with the benchmark interest rate standing at 17%, commercial borrowing costs for businesses routinely exceed 20% annually. Financing the construction of a power plant with local-currency loans at those rates is, mathematically, unviable. Such projects are virtually guaranteed to become unprofitable. Rather than engaging in complex, long-term infrastructure financing, Kazakhstan’s banking sector has increasingly concentrated on faster and more profitable lending. Official statistics from the National Bank of Kazakhstan illustrate this imbalance. As of May 2026, banks’ claims on households had reached approximately $60 billion, while lending to non-financial private enterprises, the real economy,stood at about $29 billion, less than half that amount. In practice, commercial banks have largely withdrawn from financing major industrial investment projects, preferring consumer lending with higher liquidity and quicker returns. Foreign corporations, meanwhile, enter Kazakhstan with access to international capital markets. They secure financing from global development institutions or sovereign wealth funds in their home countries at significantly lower borrowing costs. As a result, domestic private investors often lose the competitive race before projects even reach the investment decision stage. Unequal Conditions for Investors A second obstacle for domestic investors lies in Kazakhstan’s regulatory framework. Electricity tariffs have historically been kept under government control to limit inflationary pressures and avoid sharp increases in household utility bills and production costs. To attract major international energy companies,...

TCA Interviews

Kazakhstan Seeking to Turn Transit Routes Into Investment Growth, Vice Minister Says

The development of transport and logistics has become one of the main priorities of Kazakhstan's economic policy as the country seeks to turn its position between China, Russia, the Caspian Sea, and Europe into long-term growth. Government transport data show the broader transport and warehousing sector grew in January-May 2026, although rail freight and cargo turnover remained under pressure. Large-scale rail, road, port, warehouse, and digital projects now sit at the center of that effort. The sector requires tens of billions of dollars in investment, while the reshaping of Eurasian supply chains since 2022 has raised the importance of the Middle Corridor and Caspian-linked routes. Can Kazakhstan attract the capital needed to implement large-scale infrastructure projects? How will changing investment priorities affect regional development? And how could new investment reshape the country's transport market? The Times of Central Asia discussed these questions with Maksat Kaliakparov, vice minister of transport of the Republic of Kazakhstan. TCA: How would you assess the current investment attractiveness of Kazakhstan's transport sector? How much foreign investment has the industry attracted recently? Maksat Kaliakparov: The investment attractiveness of the sector is high and continues to strengthen. In 2025 alone, gross foreign direct investment into Kazakhstan's economy reached $20.5 billion, an increase of 14.4% compared with the previous year. Investment is increasingly flowing into transport and logistics alongside manufacturing, digital infrastructure, and the financial sector. The transportation and warehousing sector was among the country's fastest-growing industries in January-May 2026, expanding by 8.4%. Investor interest is also reflected in the fact that, in 2025, Kazakhstan signed 88 commercial agreements worth more than $69.5 billion with partners from China, the UAE, the United States, and European countries. A significant share of these funds will be directed toward transport and logistics projects. More broadly, Kazakhstan's investment policy framework includes a target of increasing annual foreign direct investment inflows to $25.5 billion while raising investment in fixed capital to 25.1% of GDP. TCA: Which segments of the industry are currently attracting the greatest investor interest: railways, highways, aviation, ports, warehousing, or digital logistics? Which areas will require the largest investments in the coming years? Maksat Kaliakparov: Investor interest is spread across several major segments. Railways remain a key priority. Kazakhstan is implementing modernization and new construction projects, including the recently commissioned Dostyk-Moyynty railway section, as well as the Darbaza-Maktaaral and Moyynty-Kyzylzhar lines. By 2030, the country plans to build or modernize approximately 5,000 kilometers of railway infrastructure. Maritime and port logistics are also attracting substantial investment. Expansion is underway at the ports of Aktau and Kuryk, while a new container hub in Aktau is being built with the participation of China's Lianyungang Port Group. The project is expected to increase capacity to 240,000 TEU by the end of 2026. Road infrastructure has secured a landmark private investment through the Car Park Transformer roadside service network. Warehouse and multimodal logistics continue to develop, including through Kazakhstan's terminal at Georgia's Port of Poti. Digitalization is another important area. In particular, the pilot Smart...

Music Festivals

How OYU Fest Became a Portrait of Kazakhstan’s New Music Scene

OYU Fest returned to Almaty’s Pervomaysky Ponds for its fifth-anniversary edition, marking another step in its rise as one of Kazakhstan’s leading contemporary music festivals. Since its launch in 2022, OYU has grown from a local initiative into an important platform for Kazakhstan’s music scene, drawing a wider audience across Central Asia. Kazakhstan has welcomed more international performers in recent years, including Jennifer Lopez, the Backstreet Boys, and Enrique Iglesias. OYU has taken a different approach. It has remained a festival without foreign headliners, keeping contemporary Kazakh music at the center of its program. Instead of competing with large international shows, the festival connects local artists with audiences of different generations and reflects the range and confidence of Kazakhstan’s music scene today. The first OYU Fest took place in the summer of 2022, after the COVID-19 pandemic and the outbreak of the war in Ukraine. Although the festival has never made political statements, it emerged during a period of growing public interest in Kazakhstan’s cultural identity, national language, and domestic music scene. Artists who 15 to 20 years ago were often seen as niche or local performers now draw audiences of tens of thousands across Kazakhstan, including listeners outside ethnic Kazakh communities. OYU 2026 Brings Glastonbury Weather to Kazakhstan’s Coachella This year, OYU expanded to a two-day format for the first time and welcomed several thousand visitors. The lineup brought together emerging artists, Kazakh-language pop performers, indie musicians, rappers, R&B acts, K-pop groups, and long-established singers known to several generations in Kazakhstan. The range of performers showed how far Kazakhstan’s contemporary music scene has developed, from newcomers to established names. The festival opened with torrential rain, recalling OYU’s first edition. At that first festival, strong winds tore down tents. Performers sang on a soaked stage, and audiences danced through the downpour to songs by Zoloto and hits from Kairat Nurtas, one of Kazakhstan’s best-known pop stars. The weather became part of the festival’s identity. This year, forecasts predicted only light showers. Shortly before the festival began, however, Almaty was hit by what felt like a tropical downpour. Visitors arrived at the festival grounds completely soaked, although organizers distributed free rain ponchos at the entrance. People sheltered beneath temporary canopies and joked that OYU, once dubbed Kazakhstan’s Coachella, had unexpectedly become Kazakhstan’s Glastonbury, where rain and muddy ground are part of the experience. The mostly young audience was undeterred. By evening, the rain had eased, and by the time ARO, the fourth performer on the lineup, took the stage, it had stopped. The festival hosts jokingly called him a “rain whisperer,” noting that showers had ended just as he began performing more than once before. On the first day, audiences saw performances by On Alty, Almás, Zakryty Klub, Sadraddin, Kunzharyq, ALPHA, Yenlik, Berkut & Aisha, and others. The second day featured dosm., Ken Dala, abdr., Dequine, Ringo, Orynkhan Rakhimbekov, Roza Rymbaeva, and the independent music association Qazaq Indie. The lineup showed the range of Kazakhstan’s contemporary music scene. Festivalgoers heard Kazakh-language...

Fuel Exports

Kazakhstan Weighs Kyrgyz Fuel Request as Export Ban Extension Looms

Kazakhstan is considering Kyrgyzstan’s request for gasoline supplies following an official appeal from Bishkek, Deputy Energy Minister Kaiyrkhan Tutkyshbayev has said. At the same time, the Kazakh government plans to extend its ban on fuel exports until May 2027. In late June, Russia, which supplies around 90% of Kyrgyzstan’s fuel imports, imposed a full ban on exports of gasoline and jet fuel. In early July, Kyrgyzstan’s Ministry of Energy announced that it had begun negotiations with several countries to diversify fuel imports. Speaking after a government meeting on July 7, Tutkyshbayev confirmed that Kazakhstan had received an official request from Bishkek. “We have received an official request from the Kyrgyz side, and it is currently under consideration,” Tutkyshbayev said. “All decisions will be made with due regard to Kazakhstan’s national interests and domestic market balance. However, I can state officially that fulfilling such a request would not lead to higher fuel prices within Kazakhstan. We will review the request in the near future and provide our response.” The deputy minister did not specify the volumes requested. As previously reported by The Times of Central Asia, Kyrgyzstan has also sent official requests to the relevant authorities in Russia, Belarus, Azerbaijan, Uzbekistan, and Turkmenistan as part of efforts to secure alternative fuel supplies following Russia’s export restrictions. Tutkyshbayev also said Kazakhstan’s Energy Ministry had not received an official Russian request for fuel supplies, despite Reuters reporting earlier that Moscow was in talks to import about 50,000 metric tons of AI-92 gasoline from Kazakhstan after refinery outages and drone strikes cut Russian gasoline output by roughly 25%. Tutkyshbayev acknowledged a sharp increase in gasoline consumption in Kazakhstan’s three regions bordering Russia, West Kazakhstan, Pavlodar, and Aktobe, which may indicate cross-border fuel flows. “Some motorists install additional fuel tanks on their vehicles,” he said. “We are monitoring the situation closely, and together with other government agencies we have stepped up efforts to combat the illegal export of fuel from Kazakhstan.” Meanwhile, Kazakhstan is preparing to extend its existing ban on fuel exports from November 22, 2026, until May 22, 2027. A draft order published on the government’s Open NPA portal would prohibit exports of gasoline, diesel fuel, and certain petroleum products by road and rail, including shipments to fellow members of the Eurasian Economic Union. The draft also proposes a separate ban, from January 1 through June 30, 2027, on exports outside the Eurasian Economic Union customs territory of light distillates, jet fuel, diesel fuel, gas oil, toluene, xylene, and petroleum bitumen. The proposed restrictions underline the tension in Kazakhstan’s fuel policy: Astana wants to protect its domestic market in the short term, even as it plans major oil and petrochemical investments and has set a long-term goal of increasing fuel exports.

Energy Security

Central Asia’s Fuel Squeeze Becomes a Winter Energy Security Problem

Central Asia’s fuel squeeze is moving from filling stations into winter planning. Governments are now tracking gasoline and diesel, gas pipelines, coal deliveries, power imports, jet fuel, and emergency repair crews. Seasonal fuel and power stress is familiar across the region, but the current pressure - tied to Russia, the main supplier for several regional fuel flows - has arrived early. Russia’s own fuel crisis has sharpened the risk. Ukrainian drone attacks and repair work have cut refinery output, while export limits have pushed more Russian supplies back into the domestic market. Reuters reported queues, regional restrictions, and gasoline above 100 roubles a liter at some independent stations. President Vladimir Putin acknowledged the strain on June 28. “You are well aware that problems for drivers and for businesses persist,” he said, adding that “the harvest depends on” keeping seasonal fuel schedules for farms. For Central Asia, Russian shortages travel through contracts, rail slots, import prices, and public nerves. Kyrgyzstan is among the most exposed. The country consumes about two million tons of fuels and lubricants each year, and almost 95% comes from Russia, according to Deputy Energy Minister Nasipbek Kerimov. “Due to the lack of adequate oil and gas production, we remain a country dependent on imports,” Kerimov said. Bishkek has asked Russia, Kazakhstan, Belarus, Azerbaijan, Uzbekistan, and Turkmenistan for help securing supplies. That dependence is now impacting households, farmers, and small transport firms. The cabinet has capped pump prices and set a subsidy mechanism through September 30. Kerimov said importers were seeing offers at several prices, but promised that “there should be no shortage on the domestic market.” Oil traders put AI-92 stocks at 30 to 45 days, while diesel remained available for harvest work. Kyrgyzstan is trying to buy time through domestic refining. The modernized Junda refinery in the Chuy Region has been pressed to raise gasoline output to 24,000 tons a month soon, then 50,000 tons a month by the end of 2026, with finished products directed to the domestic market. Those gains would help, but Russian supply still sets the pace. Uzbekistan has the Bukhara and Fergana oil refineries, the Altyaryk unit of the Fergana refinery, and the Uzbekistan GTL complex, but demand has still moved faster than domestic supply. In January-April 2026, gasoline imports reached 568,700 tons, worth $327.1 million, more than double the same period in 2025. Local refineries produced 417,500 tons over those four months. A shift away from AI-80 gasoline has also pushed drivers toward AI-92 and AI-95. The pressure reached the exchange in late June. AI-92 gasoline climbed to a record 13.919 million soums per ton on June 29, about $1,160, after an 11.8% rise since the start of the month. Jet fuel has become an issue, too. Uzbekistan Airways reduced some Russia flight frequencies in June, citing aviation fuel shortages and higher costs. Tashkent is now preparing for winter in concrete volumes. On July 6, President Shavkat Mirziyoyev reviewed measures for the 2026-2027 autumn-winter season. The plan includes replacing 53.7...