Kyrgyzstan Business & Economy - The Times Of Central Asia

Viewing results 13 - 18 of 810

UNDP

How Central Asian Small Businesses Are Earning More From Local Products

For Ikhtiyor Alimov, finding foreign buyers was only part of the challenge. His dried-fruit business in northern Tajikistan also needed enough equipment to fill its orders. Alimov founded Mevai Zarrin in Isfara with eight workers and handmade machinery. Its processing capacity eventually reached 200 kilograms a day, but manual production limited further growth. With the support of the United Nations Development Programme (UNDP), the company upgraded its equipment and packaging. It can now process 600–650 kilograms daily, according to the organization’s account of its development. “We were able to reduce our product waste by 20%,” Alimov said in UNDP’s regional account of the program. Across Central Asia, small producers face similar difficulties. Processing a harvest before selling it can increase producers’ earnings, but expansion requires investment that many family businesses struggle to afford. The Finland-funded Aid for Trade initiative, implemented by the UNDP, is closing after more than 15 years of work across Kyrgyzstan, Tajikistan, and Uzbekistan. UNDP and Kyrgyzstan’s Ministry of the Economy presented results in Bishkek on September 24, discussing which forms of support should continue beyond 2026. In Tajikistan, UNDP reported that the initiative helped create 147 jobs, including 90 for women since 2022. At Mevai Zarrin, support depended partly on buying fruit from local farmers and connecting producers in southern Tajikistan with processors in the north. The company signed contracts with ten farming households in Khatlon, securing supplies while giving growers another outlet for their harvests. Pooling smaller harvests can make deliveries large enough for a processor to buy. For farmers, those arrangements offer a route beyond nearby markets without requiring each household to become an exporter. Mevai Zarrin also obtained FSSC 22000 food safety certification to help it pursue new customers. In UNDP’s September profile, Alimov said the company had sent samples to prospective buyers in Germany and was awaiting their response. Processing the Harvest In Uzbekistan’s Andijan region, Dildora Nurmatova’s family business, ErElDi, has increased its profits by processing peanuts. Nurmatova began investigating the crop during her agricultural studies. By 2024, her enterprise was harvesting five metric tons from one hectare. According to UNDP’s regional retrospective, selling processed snacks rather than raw peanuts tripled her profits. [caption id="attachment_57615" align="aligncenter" width="1920"] Dildora Nurmatova in her peanut field in Uzbekistan’s Andijan region. Image: Elyor Nemat, UNDP Uzbekistan[/caption] Aid for Trade supplied processing and packaging equipment, alongside a separate workshop and a three-phase electricity connection. Business advice helped the family develop products and organize production. The company supplies packaged peanuts to Andijan’s wholesale market. Lower-grade kernels go into milled products for bakeries and ice-cream producers, giving the family a market for material that cannot be sold as premium snacks. ErElDi’s customers are close to home. The family can earn more from its harvest by doing the processing itself, before it considers the costs of finding buyers abroad. In Kyrgyzstan, UNDP reported that the project contributed to 837 new jobs, including 548 for women, and supported export contracts worth $17.1 million since 2022. [caption id="attachment_57610" align="aligncenter" width="2400"] Beekeepers...

Pharmaceutical Manufacturing

Kyrgyzstan Plans $1 Billion Pharmaceutical Industrial Park

A $1 billion pharmaceutical industrial park is planned in Kyrgyzstan as the country seeks to expand domestic drug production in a market still dominated by imports. The National Investment Agency signed a memorandum on the project with 21st Century Biomedicine on September 29. The full-cycle complex is planned for a 20-hectare site and would be developed in three stages over six years. The park is expected to include a research center, drug-production facilities, a medical devices center, and a business incubator. Less is known about 21st Century Biomedicine itself. The company has little visible public profile, and no clear record of previous pharmaceutical projects appears in publicly available sources. Kyrgyz reports say Bishkek-based MedPharm Consulting will provide organizational, technical, and legal support for the development. The proposal comes amid growing Chinese interest in Kyrgyzstan’s pharmaceutical sector. In December 2024, the government approved an investment agreement for a Kyrgyz-Chinese pharmaceutical project led by Standard Pharm Group, with planned investment of more than $41 million. Chinese investors have since discussed further projects, including a pharmaceutical plant using locally grown medicinal herbs. Drug production at the proposed industrial park is planned to comply with the Eurasian Economic Union’s Good Manufacturing Practice standards, which set common requirements for pharmaceutical manufacturing and quality control across Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia. Meeting those standards would be one requirement for exporting medicines within the EAEU. According to the National Investment Agency, domestic production currently covers around 4% of Kyrgyzstan’s pharmaceutical needs. If the park is completed, the project is expected to raise the country’s pharmaceutical self-sufficiency to 25–30%. The proposed development is also expected to create 2,500–3,000 direct jobs and more than 10,000 indirect jobs. Kyrgyzstan remains heavily dependent on foreign medicines. In November 2025, a Health Ministry official said that imports accounted for around 97% of medicines sold in the country, with domestic producers supplying about 3%. The authorities are seeking to develop domestic production while also expanding infrastructure for storing and distributing medicines. In September, construction began in Bishkek on a state pharmaceutical warehouse and logistics complex for Kyrgyzpharmatsiya, the state enterprise responsible for centralized procurement of medicines and medical supplies for public healthcare institutions. The new facility, worth around $7.4 million, is intended to improve the storage and nationwide distribution of pharmaceuticals. For now, however, the proposed $1 billion pharmaceutical park remains at the memorandum stage.

Digital Policy

Central Asia Common Digital Space Proposed at Astana Roundtable

Experts and business representatives from across Central Asia have proposed mutual recognition of electronic documents to make cross-border business easier. Their draft agreement also calls for closer alignment of rules on data and artificial intelligence. The draft Agreement on Cooperation among Central Asian States in Digital Policy and Artificial Intelligence Governance was presented at a regional roundtable in Astana on September 28. The business-led proposal aims to connect the region’s five digital markets, serving more than 80 million people. The initiative is being developed within B5+1, a business cooperation platform linking the United States and the five Central Asian states and designed as a private sector counterpart to the diplomatic C5+1 format. E-commerce and information technology are among its priority areas. Over the past year, the regional IT & AI working group has held consultations with entrepreneurs, industry associations, and experts. In the previous cycle, consultations involved business communities representing more than 60 companies and organizations from Central Asia and the United States, including Meta, Mastercard, and Google. Under the draft, the five countries would retain their own regulations while making their digital systems and laws more compatible. It covers electronic document management, digital identification, personal data protection, cybersecurity, and AI regulation. The proposals would allow electronic documents, electronic signatures, and digital identification tools to be recognized across borders. This could reduce administrative barriers for companies expanding into neighboring markets. “Our task is not to create another layer of regulation. We need to build digital bridges between the countries of Central Asia. If electronic documents, digital identification, data rules, and approaches to AI are mutually compatible, it will become significantly easier for technology companies to scale across the entire region,” said Aziza Shuzheeva, Chair of the Board of the TechnoWomen non-profit organization. A draft Code of Ethics for the Responsible Use of Artificial Intelligence in Central Asia was also presented in Astana. The document is advisory and sets out common ethical principles for the use of AI across the five countries. Its authors propose that decisions significantly affecting a person’s rights and interests should not be left solely to algorithms. Practices identified as unacceptable include harmful manipulation, exploitation of the vulnerabilities of children and other groups, discrimination, unlawful use of personal data, and the creation of synthetic content for fraud or other harmful purposes. Another priority is the development of language resources and datasets for Kazakh, Kyrgyz, Uzbek, Tajik, and Turkmen. The aim is to improve the ability of AI systems to work with the region’s languages. Similar forms of digital integration are already being developed elsewhere. In the European Union, the European Digital Identity framework is designed to allow digital identity wallets to be used across borders to access public and private services. ASEAN, meanwhile, concluded negotiations at the end of May 2026 on its Digital Economy Framework Agreement, or DEFA, covering digital trade, data, cybersecurity, AI, and other areas of regional digital integration. The proposals also overlap with efforts to digitize transport and trade. On September 28, the...

C5+1

U.S. Links Trusted Digital Infrastructure to Investment at C5+1 Conference

Stronger cybersecurity and trusted digital infrastructure could encourage greater U.S. investment in Central Asia, Mark Cameron said in Astana on September 29. Cameron, deputy assistant secretary in the State Department’s Bureau of South and Central Asian Affairs, was speaking at the C5+1 conference on artificial intelligence. He said data centers and trusted infrastructure would give American companies greater confidence to invest and expand their cooperation across the region. “The strongest house is built on the firmest foundation,” Cameron told reporters, linking cybersecurity to the development of advanced AI. Cameron said Washington sees private companies as central to the process, with government programs helping create conditions for investment and technological cooperation. “The United States has the deep belief that companies, given the opportunity, will find great solutions and new opportunities that many of us have never even considered before,” Cameron said. He said Washington has committed $5 million through CRDF Global for cybersecurity and digital-sector assistance. The support covers incident response, critical infrastructure protection, financial sector security, and cybersecurity policy. The C5+1 format brings together the United States and the five Central Asian countries. The conference comes ahead of Secretary of State Marco Rubio’s planned business delegation to Uzbekistan in mid-October, involving executives from more than 100 American companies alongside talks with the region’s foreign ministers. Kazakhstan Sets Out Its AI Development Model Kazakhstan’s vice minister of artificial intelligence and digital development, Bakhtiyar Mukhametkaliyev, described the development of an AI economy as a five-layer process. Energy comes first, followed by access to chips and graphics processing units (GPUs), information systems, high-quality data, and finally AI agents. Countries that attempt to deploy AI agents before building the infrastructure and data beneath them, Mukhametkaliyev said, are unlikely to realize their full economic value. He also framed data centers as a way for Kazakhstan to convert its energy and resource base into higher-value digital capacity. Mukhametkaliyev stressed that Kazakhstan does not intend to build its emerging AI ecosystem solely for the domestic market. He said the infrastructure should also help neighboring countries develop their AI industries and improve connectivity. He also pointed to drones, space technologies, startups, and workforce reskilling as areas where digitalization could create new markets and occupations. Kazakhstan’s ties with U.S. technology companies are also expanding. NVIDIA CEO Jensen Huang is scheduled to make his first visit to Kazakhstan on October 23, as the country develops data centers and NVIDIA-based computing infrastructure. Regional Plans for AI Development Kyrgyzstan focused on practical AI applications, human oversight, education, and local-language models. Niyazaly Bazarbaev, adviser to the minister of digital development and innovative technologies, said Kyrgyz and other Central Asian languages remain insufficiently represented in existing AI systems. He discussed work involving a Kyrgyz-language corpus of roughly five million words and efforts to prepare the school curriculum for an AI-driven economy. Tajikistan presented AI as a presidential priority. Hakim Ismoilzoda, first deputy director of the Agency for Innovation and Digital Technologies, highlighted Tajikistan’s initiatives at the United Nations on AI and its safe, secure,...

CKU Railway

Opinion: China-Kyrgyzstan-Uzbekistan Railway Opens New Options Beyond Europe

The China-Kyrgyzstan-Uzbekistan railway is often presented as a new route to Europe, but its first benefits are likely to be felt closer to home. It could give Central Asian shippers more choice and governments more room to negotiate transport costs, even where sanctions restrict access to European markets. Excavation of the 209.6-meter Kosh-Dobo North No. 2 tunnel was completed on August 5. Work is also underway on other tunnels along Kyrgyzstan’s mountainous section of the railway. CKU is advancing as falling Caspian water levels make the Middle Corridor more expensive to maintain. That could increase demand for alternative routes, although each comes with its own costs and restrictions. Kyrgyz officials have high expectations. Deputy Prime Minister Edil Baisalov told TCA that “this railroad will virtually transform Kyrgyzstan.” Fulfilling that ambition will require the country to earn more than transit fees. Much depends on Makmal, where a transshipment station and possible logistics center are planned. The Torugart-Makmal section will use the Chinese standard gauge of 1,435 mm, while the Makmal-Jalal-Abad section will use the 1,520 mm gauge common across the post-Soviet rail system. Changing gauge adds time and expense as cargo moves between trains. The planned station will handle transfers between the two systems, as well as cargo sorting and train assembly, operations which could support local logistics businesses, provided there is enough traffic. Warehousing and customs services would give Kyrgyzstan a chance to earn more from that traffic. Whether Makmal develops into a wider logistics hub will depend on the services available and their cost to shippers. The mountainous terrain makes the line expensive and slow to build. It also limits the options for competing routes through the Tien Shan. That may strengthen Kyrgyzstan’s negotiating position, but only if the railway offers a reliable service at competitive rates. The trans-Caspian Middle Corridor avoids Russia and Iran, making it more attractive to European companies concerned about sanctions. Yet, as TCA has reported, falling Caspian water levels are raising the cost of the route through Aktau and Kuryk. Low sea levels around Aktau and Kuryk reduce loading efficiency and increase transport costs. Kazakhstan has dredged Kuryk and launched deeper work at Aktau, aiming for a 7.7-meter depth in the operational part of the port. The Caspian route remains workable, but maintaining it requires continuing investment. If those costs rise, shippers will have more reason to compare alternatives. There are also delays to address. In a recent TCA interview, the TITR secretary general stressed the need to speed up the route and ease Caspian bottlenecks as freight volumes grow. A southern route could avoid Caspian transshipment. From Uzbekistan, cargo can move through Turkmenistan and Iran to Turkey. Uzbek, Iranian, and Turkish officials have already discussed linking this corridor with the CKU railway. Some freight already travels south on existing lines. In September, a 55-container block train was dispatched from Kazakhstan’s Altynkol station after crossing from China. Its announced route ran through Uzbekistan and Turkmenistan to Iran via the Sarakhs border station. It carried...

Economic Growth

Central Asia Growth Forecasts Remain Strong in Latest ADB Outlook

Four of Central Asia’s five economies are expected to grow faster in 2026 than developing Asia and the Pacific as a whole, according to the Asian Development Bank’s September Asian Development Outlook. ADB forecasts growth of 5% across developing Asia and the Pacific this year, compared with 8.9% in Kyrgyzstan, 7% in Uzbekistan and Tajikistan, and 6.3% in Turkmenistan. Kazakhstan is the exception, with growth forecast at 4.8%. Kyrgyzstan is growing faster than its neighbors but is also facing the highest inflation among the five countries. ADB forecasts inflation at 11.2% this year and 8.5% next year. Growth continues to be supported by domestic demand and sustained investment, while ADB says import dependence and electricity-generation shortfalls are contributing to inflationary pressures. For Uzbekistan, ADB forecasts gross domestic product growth of 7% and inflation of 6.7% in 2026. In 2027, the figures are expected to be 6.8% and 5%, respectively. Stronger-than-expected economic activity prompted ADB to upgrade Uzbekistan’s 2026 growth forecast in its September outlook. Tajikistan is also forecast to grow by 7% in 2026, with inflation at 4.5%. Growth is expected to slow to 6.8% in 2027, while inflation is forecast to edge up to 4.7%. ADB lowered its 2026 growth projection in September, saying the escalation of Russia’s war in Ukraine had disrupted fuel imports and constrained near-term economic activity. Kazakhstan, the region’s largest economy, is growing more slowly than its neighbors. ADB expects growth of 4.8% this year and 4.5% next year, with inflation forecast at 10.4% and 9.5%, respectively. The bank left its growth and inflation forecasts unchanged from its previous outlook, with inflation expected to ease only gradually. For Turkmenistan, ADB forecasts growth of 6.3% in 2026 and 6.2% in 2027, with inflation at 6% in both years. The country’s economic indicators remain more difficult to compare with those of its neighbors because of limited access to reliable and detailed economic data. Its economy also remains heavily dependent on natural gas exports, with China its main gas market. Central Asia’s growth figures look strong against the Asian backdrop, but ADB is warning of energy and climate risks across developing Asia and the Pacific. Prolonged disruption to global energy markets could keep oil and gas prices elevated and volatile. For energy importers, that means higher fuel costs and additional inflationary pressure, while hydrocarbon exporters may benefit from higher prices but remain vulnerable to disruption in production and export routes. Another risk is a very strong El Niño, which ADB expects to persist through the first quarter of 2027. Extreme weather could reduce agricultural production and push up food prices, while a decline in hydropower generation could increase demand for other energy sources. For Kyrgyzstan and Tajikistan, where hydropower supplies most electricity, weather and water availability add another layer of vulnerability. The differences between forecasts for the region remain substantial. In August, The Times of Central Asia compared projections from international financial institutions. The Eurasian Development Bank (EDB) forecast 2026 growth of 10.2% for Kyrgyzstan, 8.3% for Tajikistan,...