Kazakhstan Business & Economy - The Times Of Central Asia

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Digital Governance

How Digital Public Services Are Changing Daily Life in Central Asia

Kazakhstan, Uzbekistan, and Kyrgyzstan have moved from queues at public service centers to passports in mobile apps in just a few years, compressing a transition that took many countries decades. Behind the impressive figures, however, are questions the region is still trying to answer. Not so long ago, obtaining a certificate in Central Asia meant a trip to a government office, a queue, and a stack of papers. Today, a resident of Almaty can renew a driver’s license by phone, an entrepreneur in Tashkent can register a company without leaving the office, and a doctor in Bishkek can issue an electronic sick leave certificate. The digitalization of public services has moved beyond strategic documents and become part of everyday life for tens of millions of people. The scale of change is reflected in international assessments. In the United Nations E-Government Development Index (EGDI) for 2024, Asia showed the fastest growth of any region. Kazakhstan, Uzbekistan, and Kyrgyzstan all improved their positions, each at its own pace, and each with its own model. Kazakhstan: From eGov to a Platform State Kazakhstan remains one of the region’s leaders in digital governance. In the 2024 EGDI ranking, the country rose to 24th place globally, ahead of a number of developed economies. Today, around 90% of more than 1,300 public services are available online, while the eGov.kz portal and eGov Mobile app offer access to a growing range of services. The figures speak for themselves. According to Kazakhstan’s e-government portal, citizens received more than 25.7 million services through eGov.kz in 2025, while the eGov Mobile audience exceeded 11.7 million users. The “Digital Documents” section is especially popular: the app provides access to 39 types of documents, from identity cards to driver’s licenses and student IDs. The expansion has continued. In 2025, Kazakhstan launched eGovBusiness, a single-window service for entrepreneurs that allows them to register companies, apply for subsidies, and check risks. The authorities have also moved to consolidate fragmented government apps into the unified eGov and Aitu platforms. The next frontier is artificial intelligence. In 2025, Kazakhstan established the Ministry of Artificial Intelligence and Digital Development. Through the National AI Platform, the country is developing sovereign infrastructure intended to support the use of generative AI in government and keep citizens’ data within national systems. Uzbekistan: The Fastest Leap Forward If Kazakhstan sets the regional benchmark, Uzbekistan has shown some of the fastest momentum. Over six years, the country climbed 24 positions in the EGDI ranking, from 87th place in 2018 to 63rd in 2024, and entered the category of countries with a “very high” level of e-government development for the first time. At the center of this transformation is the unified portal my.gov.uz, through which citizens and businesses access public services. More than 760 services are available on the platform, while the mobile app offers more than 540. In the first half of 2025 alone, more than 16 million services were provided through the system. The direction is set by the Digital Uzbekistan 2030...

Monetary Policy

Kazakhstan Central Bank Chief Sees No Pressure on Tenge After Rate Cut

Kazakhstan’s central bank governor has sought to calm concerns over the tenge after the National Bank cut its base rate for the first time since October 2025, saying demand for local-currency assets should remain stable despite lower returns. The National Bank of Kazakhstan lowered its base rate to 17% from 18% on June 5, citing slowing inflation and an improved economic outlook. The decision was based on updated assessments of inflation risks and key macroeconomic indicators, the bank said. Annual inflation slowed to 10.4% in May from a peak of 12.9% recorded in September last year. The central bank also raised its oil price assumption for the remainder of 2026 to $90 per barrel for Brent crude. National Bank Governor Timur Suleimenov said the rate cut would lower returns on tenge-denominated deposits but would not trigger a significant shift into foreign-currency assets. “Interest rates on tenge deposits remain substantially higher than returns on foreign-currency deposits,” Suleimenov told reporters. “A one-percentage-point reduction will not fundamentally change the attractiveness of deposits or other tenge-denominated assets such as corporate bonds and government securities.” Suleimenov said demand for local-currency assets is expected to remain stable, limiting pressure on the exchange rate. He acknowledged that the tenge could face seasonal pressure during the summer because of increased demand for foreign currency linked to overseas travel and dividend payments by Kazakhstani companies listed on international exchanges. However, he said Kazakhstan’s economic fundamentals remain supportive of the national currency. “Oil prices are rising, while metal prices have increased by an average of around 17%, with some commodities gaining as much as 40%,” Suleimenov said. “If there are no major external shocks, I see no reason for any significant weakening of the tenge.” The central bank also revised its inflation forecast for 2026 downward to a range of 9%-11%, compared with a previous estimate of 9.5%-11.5%. Its inflation forecast for 2027 remains unchanged at 5.5%-7.5%. Suleimenov said the bank expects inflation to approach its long-term target of 5% by 2028 as external inflationary pressures ease and government and central bank measures take effect. “The slowdown in inflation during April and May gave us room to lower the base rate,” he said. “But it would be premature to say inflation has been defeated. Future decisions will depend on incoming data and our assessment of risks.” The official exchange rate stood at 487.4 tenge per U.S. dollar on June 7. The outlook remains cautious. As previously reported by The Times of Central Asia, S&P Global Ratings forecast that the tenge would average around 540 per dollar in 2026, reflecting expectations of a weaker currency over the medium term.

Middle Corridor

Kazakhstan Eyes Cyprus as Middle Corridor Link to Mediterranean

Kazakh President Kassym-Jomart Tokayev has invited Cyprus to participate in the development of the Trans-Caspian International Transport Route, seeking to strengthen trade links between Central Asia and the Mediterranean through one of Eurasia’s fastest-growing trade routes. The proposal was made during talks with Cypriot President Nikos Christodoulides, who paid an official visit to Kazakhstan. The TITR, also known as the Middle Corridor, connects China and Europe through Kazakhstan, the Caspian Sea, the South Caucasus, and Turkey. The route is approximately 3,000 kilometers shorter than the traditional northern route through Russia and currently allows cargo to travel from China to Europe in 10 to 15 days, compared with roughly twice that time via the northern corridor and up to 60 days by sea. “Cyprus is a world-class maritime hub, and the Middle Corridor creates significant opportunities to effectively connect Kazakhstan’s land transport infrastructure with Cyprus’s maritime infrastructure,” Tokayev said during a joint press briefing following the talks. According to Tokayev, such cooperation could help establish a new multimodal logistics network linking Central Asia, the Caspian region, and the Mediterranean while supporting growth in bilateral trade. The two leaders discussed expanding trade and investment ties, as well as strengthening business cooperation between the two countries. Tokayev said he had proposed developing a roadmap for bilateral economic cooperation and establishing an intergovernmental commission and business council to facilitate joint projects and increase commercial exchanges. He identified logistics, finance, tourism, and digital technologies as key areas for future cooperation, adding that Cyprus has expressed interest in Kazakhstan’s e-government platform and digital public services. Kazakhstan, he said, is ready to share its experience in those areas. More than 400 companies with Cypriot capital currently operate in Kazakhstan, including around 30 registered with the Astana International Financial Centre, according to Tokayev. Kazakhstan is prepared to create favorable conditions for Cypriot businesses interested in entering its market, he added. Speaking at a Kazakhstan-Cyprus business forum following the presidential talks, Prime Minister Olzhas Bektenov said Cyprus had invested more than $5 billion in Kazakhstan since 2005, with nearly half of that amount invested during the past five years. Bektenov said both countries occupy strategic positions along trade routes linking Europe and Asia. He suggested Cyprus could serve as a regional logistics hub in the eastern Mediterranean, complementing Kazakhstan’s role as a transit gateway between China and Europe. He also highlighted new direct flights between Astana and Larnaca, which began on June 2, and Almaty and Larnaca, which began on June 4, saying the routes would improve passenger travel and cargo links. The visit also carries a wider diplomatic context as it coincided with the inauguration of Cyprus’s embassy in Astana, its first in Central Asia, and comes amid continued sensitivity in Turkey over the Cyprus issue. Ankara has denied reports that Foreign Minister Hakan Fidan canceled a planned visit to Kazakhstan because of Christodoulides’ trip. The episode follows Tokayev’s recent effort to describe the Organization of Turkic States as a forum for cooperation rather than a military alliance,...

Middle Corridor

Baku-Tbilisi-Kars Railway Boosts Kazakhstan’s Middle Corridor Role

The Baku-Tbilisi-Kars railway entered full-scale operation on June 2, a development expected to increase freight transport along the Trans-Caspian International Transport Route and support Kazakhstan’s role as a key transit hub between China and Europe. The railway is a joint strategic project of Azerbaijan, Georgia, and Turkey and serves as one of the main overland links connecting Central Asia with European markets through the South Caucasus. The 827-kilometer line has been operating at limited capacity since 2017. Full commercial operation became possible following the completion of rehabilitation and construction work on the Marabda-Kartsakhi section in Georgia. According to Georgia’s Ministry of Economy and Sustainable Development, the project included the construction and modernization of bridges, railway stations, overpasses, traction substations, a cross-border rail tunnel linking Georgia and Turkey, and upgrades to the Akhalkalaki International Railway Station, one of the corridor’s key logistics hubs. The completion of the project is expected to increase the railway’s annual cargo-handling capacity to 5 million metric tons, allowing it to accommodate growing freight volumes moving between Asia and Europe. “The full-scale operation of the Baku-Tbilisi-Kars railway is an important event not only for Georgia, Azerbaijan, and Turkey, but for the entire region and Central Asia,” Georgia’s Minister of Economy and Sustainable Development Mariam Kvrivishvili said during the inauguration ceremony. She described the railway as a critical transport link connecting Europe, Central Asia, and China. According to Kvrivishvili, container traffic through Georgia involving China and Kazakhstan increased by 33% in 2025, while the number of containers transported along the Baku-Tbilisi-Kars route was nearly six times higher than in the previous year. Kazakhstan was represented at the ceremony by Deputy Transport Minister Zhanibek Taizhanov, showing the strategic importance Astana places on the corridor. Authorities in Kazakhstan view the full launch of the Baku-Tbilisi-Kars railway as a significant step in developing the country’s transit potential and improving logistics links between China, Central Asia, the Caucasus, and Europe. The railway forms a key component of the Middle Corridor, which has gained increasing attention in recent years as governments and logistics companies seek alternatives to traditional Eurasian trade routes.

Data Centers

Financial Analyst Says Kazakhstan’s State Data Centers Are Priced Beyond Reach of Businesses

The cost of services offered by state-backed data centers in Kazakhstan is too high for many businesses, making overseas cloud providers a more economical alternative, financial analyst Rasul Rysmambetov said. His comments come as Kazakhstan invests heavily in digital infrastructure and artificial intelligence technologies. Last year, the country launched what authorities described as Central Asia’s most powerful supercomputer, saying its capacity would be made available to startups, universities, and private companies developing AI solutions. The government has also announced plans to create a Data Center Valley in the northeastern Pavlodar Region to support the digitalization of the economy. However, Rysmambetov argued that the pricing of state-supported data centers limits their appeal to the private sector. “A real digital economy is built on microservices, not giant buildings filled with computers,” Rysmambetov told the Atameken Business Forum. “Data centers depreciate at a tremendous pace. Today, state data centers in Kazakhstan charge prices so high that, as a financier, it is far cheaper and easier for me to buy cloud capacity directly in California.” Rysmambetov said that despite economic growth and rising foreign investment, many Kazakhstanis have yet to see significant improvements in living standards. In his view, the key challenge is not attracting investment but converting it into jobs and productive industries. He also argued that traditional investment incentives are losing effectiveness. “Tax breaks, subsidies, and state support measures no longer create a competitive advantage. Instead, they often generate a dangerous environment for corruption,” he said. “What matters today is the quality of institutions and the speed of decision-making.” According to Rysmambetov, Kazakhstan’s investor support system remains fragmented, with multiple agencies performing overlapping functions while coordination between central and regional authorities remains weak. As a result, some government directives are not implemented locally, requiring intervention by prosecutors to protect investors’ rights. Rysmambetov identified rare earth metals and tungsten as among the sectors attracting the greatest investor interest. However, he warned that Kazakhstan risks repeating the resource-dependent model that characterized its oil industry if it focuses primarily on exporting raw materials rather than developing domestic processing industries. “Foreign investors do not create growth, they join it,” he said. “Investors see a functioning economic model, recognize an opportunity, and participate in it. But if we ourselves do not believe in our development strategy, nobody from outside will come.” Kazakhstan aims to attract $62.7 billion in investment this year, including $25.5 billion from foreign investors, as part of its economic development strategy.

Alatau City

Tokayev Calls for Greater Role for Kazakhstani Businesses in Alatau City Development

Kazakhstani entrepreneurs must become full participants in the development of Alatau City, the country’s flagship smart city project, alongside foreign investors, Kazakhstan’s president Kassym-Jomart Tokayev said. He made the remarks during a meeting on the future of what is envisioned as Kazakhstan’s first fully digital city. In 2024, Tokayev signed a decree granting city status to Zhetygen village, located approximately 50 kilometers from Almaty, Kazakhstan’s largest city. Alatau City incorporates Zhetygen as well as the settlements of Enbek, Zhanaarna, and Kuigan, along with parts of Konaev and Talgar district in Almaty Region. The project is designed as a smart city comprising four distinct zones: the Gate District, a financial and business center; the Golden District, focused on education and healthcare; the Growing District, dedicated to industrial and logistics facilities; and the Green District, intended for recreation and entertainment. Speaking at the June 2 meeting in Almaty, Tokayev said more than 50 investment projects had already been identified for Alatau City, with a combined value of approximately $4 billion and the potential to create more than 50,000 jobs. He called for the portfolio to be expanded in the next one or two years by attracting investors to priority sectors. Domestic businesses, he said, must become “full participants in the city’s development rather than mere observers.” Tokayev cited Shenzhen and special legal regimes in Hainan, Dubai, and Singapore as examples of places where governments played an early role by building core infrastructure. That approach, he added, reduces risks for businesses, creates predictable conditions for private capital, and can generate a cycle in which public infrastructure investment attracts private capital and future tax revenues. The president warned that shifting the burden of initial infrastructure investment to the private sector can reduce a project’s appeal and lead to monopolistic structures with excessive tariffs. He instructed the government to ensure stable financing for Alatau City’s core infrastructure during the initial stage and said the city could be given additional borrowing limits and authority to undertake government borrowing until it develops a sustainable revenue base. Budget funds, he said, must be used strictly for investment purposes and linked to the city’s long-term development. Tokayev directed investment toward priority sectors including information technology, industry, transport and logistics, tourism, healthcare, and education. To create a favorable investment climate, he instructed officials to follow international standards, especially in areas where national regulations lag behind global practice. He identified Alatau City as a strategic platform for the rapid development of digital assets and a new financial architecture for Kazakhstan. Additionally, he called for the quick removal of excessive barriers in the sector and the introduction of new financial instruments. These would include a clear legal status for digital assets, recognition of crypto assets as property, and the use of the digital tenge within the new system. Tokayev also proposed a zero tax rate on digital asset transactions and capital gains generated within the jurisdiction, as well as faster work to tokenize real-sector assets, including real estate, infrastructure projects, and natural...