Uzbekistan Business & Economy - The Times Of Central Asia

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Investment Project Implementation

Uzbekistan Pushes to Turn $43 Billion in Investment Deals into Economic Growth

President Shavkat Mirziyoyev has instructed officials to accelerate the implementation of investment agreements signed during the 5th Tashkent International Investment Forum, stressing that every deal must deliver tangible economic results rather than remain on paper. Speaking at a government meeting on June 25, Mirziyoyev said the forum resulted in 177 agreements worth $43 billion with foreign partners. He added that each agreement should be transformed into concrete projects that create jobs and generate higher added value. “Every agreement must become a project, a workplace, and a source of high added value,” the president said. Officials were ordered to prepare decisions addressing 120 proposals submitted by foreign investors during the forum. Mirziyoyev also called on ministers and regional governors to rethink their approach to investment, placing greater emphasis on quality and efficiency. According to the president, half of all investment attracted to Uzbekistan over the past five years has gone to just four regions, but economic returns differ sharply. In Fergana, he said, every UZS 1 million invested generates an additional UZS 273,000 ($22.78) in gross regional product. In Samarkand, the figure is UZS 262,000. In Bukhara, it is UZS 117,000 ($9.76), roughly half the return in stronger-performing regions. The meeting also focused on the growing demand for construction materials driven by Uzbekistan’s ambitious development plans. Earlier this year, the government adopted a long-term housing program aiming to double the number of new homes built annually to 280,000 by 2040 and increase the number of “New Uzbekistan” residential districts from 61 to 120. In addition, Uzbekistan is commissioning 20 to 25 million square meters of commercial buildings every year, creating annual demand for at least $10 billion worth of construction materials. During the investment forum, the government also presented $27 billion in new infrastructure projects to international investors. These include a nuclear power plant in Jizzakh, a fourth copper processing plant in Tashkent Region, New Tashkent Airport with an annual capacity of 20 million passengers, a 55,000-seat stadium in New Tashkent, and a 282-kilometer highway linking Tashkent and Samarkand. Mirziyoyev said these large-scale projects require construction materials that meet strict international standards and instructed officials to establish a new system linking domestic manufacturers with major investment projects. The president also ordered the government to prepare proposals ensuring equal conditions for imported and locally produced construction materials. While foreign investors have requested value-added tax exemptions for imported materials used in major projects, domestic manufacturers argue that the same incentives should apply to local products, saying they are ready to compete on quality and standards. The meeting also addressed financial difficulties in the construction materials sector. According to officials, 457 companies have accumulated 3.5 trillion soums ($292,101,250) in overdue loans because their products remain too expensive or fail to meet current market demand. To help revive the sector, Mirziyoyev ordered officials to develop recovery plans for each company and allocate $50 million to modernize production facilities, reduce manufacturing costs, and support the production of more competitive goods.

U.S.-Uzbekistan Partnership

Uzbekistan Agrees Tariff Cuts for U.S. Goods as Moody’s Raises Sovereign Rating

Uzbekistan and the United States announced a new package of trade commitments on June 25. Moody’s raised Uzbekistan’s sovereign rating by one notch the same day. The two decisions strengthen Tashkent’s case that economic reforms are producing practical gains. Under the “early harvest” announced in Tashkent, Uzbekistan will eliminate or reduce tariffs on a wide range of U.S. industrial and agricultural goods. Washington offered favorable consideration for Uzbek products in future tariff actions, where U.S. law allows, though that language does not guarantee automatic tariff cuts for Uzbek exports. The two governments will put the commitments in writing in the coming weeks. They also agreed to speed up negotiations on an Agreement on Reciprocal Trade and Investment. President Shavkat Mirziyoyev discussed the package with U.S. Trade Representative Jamieson Greer during talks in Tashkent. The announcement gives a political lift to a relationship which is still small in terms of trade. U.S. goods trade with Uzbekistan reached over $1 billion in 2025. American exports rose 24.5% to $473.9 million, while imports from Uzbekistan climbed to $574.4 million, turning a $338.3 million U.S. surplus in 2024 into a $100.5 million deficit. The latest agreement builds on $32 billion in commercial deals announced in 2025. That figure includes an $8.5 billion Boeing agreement and planned activity in mining, energy, finance, and technology. Tashkent has also built new channels to move projects toward financing. A U.S.-Uzbekistan Business and Investment Council began work in April. A joint investment platform followed in June, with energy, infrastructure, critical minerals, and manufacturing among its target sectors. The Tashkent business forum drew 193 U.S. company representatives. Saida Mirziyoyeva, head of Uzbekistan’s presidential administration, set a clear standard at the council’s launch. “We are no longer at the stage where we speak about potential,” she said. “We are at the stage where we must deliver.” That goal extends to Uzbekistan’s long WTO accession process. The country applied to join in 1994, but negotiations stalled for years. Tashkent resumed active work in 2020 and completed bilateral market-access negotiations with the United States in December 2024. The U.S. agreement settled terms for trade in goods and services between the two countries. It did not complete Uzbekistan’s accession. Tashkent still needs an agreed multilateral package and approval from WTO members. Uzbek officials now aim to secure full membership by the end of 2026. The timetable has already moved beyond an earlier target linked to the WTO ministerial conference in March. Negotiations cover tariffs and market access, but also reach domestic rules on subsidies, state-owned companies, product standards, and intellectual property. Some industries may receive time to adjust. Chief WTO negotiator Azizbek Urunov said that transition periods of three to eight years had been discussed for some sectors. “Overall, tariffs will be reduced,” he said. “However, there are sectors that are sensitive for us.” WTO membership would place Uzbekistan’s trade policy under a common set of rules and give exporters access to the organization’s dispute system. It would also limit some forms of state...

CKU Railway

Kyrgyzstan Approves Chinese Loan for CKU Railway

Kyrgyzstan’s parliament has approved in the first reading a bill ratifying a preferential loan agreement with the Export-Import Bank of China to help finance the country’s share in the construction of the China-Kyrgyzstan-Uzbekistan (CKU) railway, one of Central Asia’s largest transport infrastructure projects. The CKU railway is a flagship regional connectivity initiative designed to improve trade routes between China, Central Asia, and beyond. Construction officially began on December 27, 2024, in Kyrgyzstan’s Jalal-Abad region. Once completed, the 523-kilometer railway will connect Kashgar in China with Torugart, Makmal, and Jalal-Abad in Kyrgyzstan before continuing to Andijan in Uzbekistan. The route is expected to carry up to 15 million tons of cargo annually. The project is particularly significant because neither Kyrgyzstan nor Uzbekistan currently has a direct rail connection with China. At present, Kazakhstan is the only Central Asian country with such a link. Construction is being managed by China-Kyrgyzstan-Uzbekistan Railway Company LLC, a joint venture established by the three participating countries. The railway is expected to cost $4.7 billion. About half will be financed through a 35-year Chinese loan to the joint project company, which will be responsible for repayment. The remaining $2.3 billion will be contributed as equity, with China holding 51%, while Kyrgyzstan and Uzbekistan will each contribute 24.5%. According to Kyrgyzstan’s Deputy Minister of Transport and Communications Almaz Turgunbaev, Kyrgyzstan will use a $304.5 million preferential loan from the Export-Import Bank of China to finance half of its contribution to the joint company, which will oversee the railway project. Kyrgyzstan’s total share in the project amounts to roughly $609 million, with half funded directly by the state budget and the rest through borrowed funds. The loan has a term of 25 years, including a five-year grace period, with an annual interest rate of 1.5%. According to Kyrgyzstan's Finance Ministry, the grant element of the loan stands at 35.46%. Officials said the funds will be used exclusively to finance Kyrgyzstan’s equity contribution to the joint railway company and cover construction costs. As of January 31, 2026, Kyrgyzstan’s debt to Eximbank stood at about $1.5 billion, making China the country’s largest external creditor. The Kyrgyzstan section of the railway will stretch more than 304 kilometers and is considered the most technically challenging part of the project. It will include 50 bridges and 29 tunnels with a combined length of about 120 kilometers, meaning around 40% of the route inside Kyrgyzstan will consist of tunnels and bridges. The railway is expected to improve regional logistics by creating a shorter trade route between China and Europe via Central Asia, bypassing existing northern corridors.

Sustainable Aviation Fuel

Allied Biofuels Advances $6.1 Billion Sustainable Aviation Fuel Project in Uzbekistan

Allied Biofuels has signed a key engineering agreement with Sinopec Engineering Group Co., Ltd. for its planned sustainable aviation fuel (SAF) and electro-synthetic sustainable aviation fuel (e-SAF) project in Uzbekistan, marking another step forward for one of Central Asia’s largest clean energy developments. The agreement was signed during the 5th Tashkent International Investment Forum. Under the front-end engineering design and detailed engineering contract, Sinopec Engineering Group will undertake front-end engineering and design, detailed engineering, systems integration, and cost development work for the project, laying the groundwork for a future engineering, procurement, and construction (EPC) contract. The project, valued at approximately $6.1 billion, is expected to become Central Asia’s first large-scale integrated bio-aviation fuel complex. According to Allied Biofuels, the facility will combine biomass processing, advanced refining technologies, renewable energy systems, green hydrogen production, and power-to-liquid fuel technologies within a single industrial platform. Once operational, the complex is expected to supply sustainable aviation fuels to both domestic and international markets at a time when airlines worldwide are seeking lower-carbon alternatives to conventional jet fuel. The signing comes amid growing global investment in SAF production as governments and aviation companies work to reduce emissions from air transport. The project is expected to reinforce Uzbekistan’s ambitions to become a regional center for sustainable aviation and clean fuel production. “This agreement marks a key step in advancing our SAF and e-SAF project in Uzbekistan from development into engineering and execution readiness,” said Alfred Benedict, managing director of Allied Biofuels. “Sinopec Engineering Group’s technical capability will help strengthen the project’s delivery pathway as we progress one of Central Asia’s most important clean fuels infrastructure developments.” Gong Yu, regional business development manager at Sinopec Engineering Group, said the company was pleased to support the project and contribute its engineering expertise to the next phase of development. Sinopec Engineering Group, headquartered in Beijing, is one of China’s leading engineering companies, with experience in refining, biofuels, green hydrogen, and large-scale industrial infrastructure projects. Under the contract, the company will provide engineering design, systems integration, and estimating services for the Uzbekistan facility. The latest agreement follows another milestone announced in May, when Uzbekistan Airports and Allied Biofuels FE LLC signed a memorandum of understanding on the future supply of SAF and e-SAF in Uzbekistan. The agreement outlined plans to begin supplying cleaner aviation fuels from 2030 and included cooperation on developing the necessary infrastructure and supply chains. According to Allied Biofuels, the refinery is expected to produce approximately 160,400 tonnes of SAF, 257,000 tonnes of e-SAF, and 5,040 tonnes of green diesel annually. The facility is also planned to operate using a 4.45-gigawatt renewable energy system supported by battery storage and green hydrogen infrastructure, making it one of the most ambitious clean fuel projects currently under development in the region.

Tashkent International Investment Forum

Rail Reform and Regional Corridors Put Uzbekistan at the Center of Central Asia’s Logistics Map

At the Tashkent International Investment Forum, officials and transport executives discussed railway reform and new corridor projects, with private investment as a main point. World Bank Senior Transport Specialist Mansur Bustoni described rail as “essential” for Uzbekistan, which depends on land routes for access to seaports and export markets. The World Bank wants to help turn Uzbekistan Railways from a state monopoly into “a commercial bankable enterprise,” he told the forum. Uzbekistan Railways has about 4,700 route kilometers, according to Bustoni. The system carries around 60 million tons of freight and 15 million passengers a year and contributes about 8% of GDP. Much of that freight is linked to exports. The World Bank is supporting 44 activities across seven reform programs. Bustoni listed legal separation inside Uzbekistan Railways, financial reform, operational efficiency, and investment planning among the main areas. Each activity has been ranked by priority, he added. Tariff reform was one of Bustoni’s main topics. He called the proposed change “not a price hike.” The aim is to replace ad hoc increases with rules-based pricing. Cost-reflective tariffs would give the railway company more predictable revenue and reduce state cross-subsidies. Bustoni also cited capital-market plans. Uzbekistan’s infrastructure company is part of the National Investment Fund of the Republic of Uzbekistan (UzNIF), which he described as a $2.4 billion fund managed by Franklin Templeton, with a planned dual listing in London and Tashkent. The railway sector recorded a roughly $188 million net loss in 2023, reached break-even in 2024, and is expected to post a positive $138 million result in 2025, he added. [caption id="attachment_50833" align="aligncenter" width="2560"] Image: TCA[/caption] Transport Corridor Europe-Caucasus-Asia (TRACECA) Secretary General Jasurbek Choriyev linked corridor development to Uzbekistan’s national priorities. He cited double-digit growth in passenger air traffic over five years and 15 million tourists last year, attributing the figures to national data and analysts at Airports Council International and the World Bank. Uzbekistan’s aircraft fleet has expanded to more than 100 planes from about 40 to 50 in recent years. A target of 188 aircraft by 2030 could be reached earlier, Choriyev noted. Uzbek airlines are also carrying more freight on the China-Europe route, driven in part by e-commerce. Choriyev described rail as the backbone of national connectivity, carrying about 90% of internal and external traffic. He pointed to the China-Kyrgyzstan-Uzbekistan-Iran railway and gave 2030 as the expected completion date, with 2028 or 2029 possible. He also cited the Trans-Afghan corridor as a route to Pakistan. About 52% of Uzbekistan’s rail network is electrified, with a target of 70% by 2030. Innokenty Ivanov, a principal consultant at Freshfields, said Uzbekistan’s railway reform is creating legal routes for private investment through market mechanisms and public-private partnerships. The reform covers the reorganization of Uzbekistan Railways as a holding company and a legal framework for private investment and independent operation. Ivanov compared the process with Germany, where railway reform led to long-term contracts between the government and the infrastructure company. Financing tied to measurable targets gives investors more certainty...

Connectivity

EU Launches Platform to Mobilize Up to €2 Billion for Europe–Central Asia Connectivity

The European Commission launched a Connectivity Agenda Platform on June 23, 2026, and concluded statements of intent with international financial institutions expected to mobilize up to €2 billion ($2.3 billion) for transport, border-crossing and trade-facilitation projects across the Black Sea region and the South Caucasus. The initiative was unveiled at a high-level ministerial meeting in Brussels, hosted by European Commissioner for Enlargement Marta Kos, Commissioner for International Partnerships Jozef Síkela, and Commissioner for Sustainable Transport Apostolos Tzitzikostas. The meeting brought together transport ministers and senior officials from EU member states, as well as representatives from Armenia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, Türkiye, Ukraine, and Uzbekistan, alongside international lenders, to advance connectivity projects under the EU’s Global Gateway strategy. The new platform is designed to coordinate investments and policy actions across transport, energy, digital connectivity, and trade. Participants also agreed to improve the operational efficiency of the Trans-Caspian Transport Corridor, a wider framework that includes the Trans-Caspian International Transport Route, or TITR, also known as the Middle Corridor. The route links China and Europe through Central Asia and the South Caucasus, offering an alternative to transport routes crossing Russia. The European Commission said the expected financing would support transport infrastructure, border-crossing modernization, and trade-facilitation projects aimed at improving freight movement across the corridor. “The Trans-Caspian Transport Corridor is becoming a vital bridge between Europe and Asia,” Síkela said, adding that the investments would help make the route faster, more reliable, and better integrated. Tzitzikostas said stronger transport links were critical for economic competitiveness and regional resilience. The platform’s launch came during Kazakh President Kassym-Jomart Tokayev’s official visit to Brussels, where he met with European Council President António Costa and European Commission President Ursula von der Leyen. In an EU–Kazakhstan joint statement, the leaders reaffirmed the strategic importance of the Trans-Caspian corridor and pledged deeper cooperation under the EU’s Global Gateway strategy. They also highlighted the EU’s role as Kazakhstan’s largest trade and investment partner and agreed to deepen cooperation in critical minerals, energy, transport, digitalization, and emerging technologies. Speaking at the Kazakhstan-EU roundtable in Brussels, Tokayev said Kazakhstan was investing heavily in infrastructure to position itself as a regional logistics hub connecting Europe, Central Asia, China, the Caucasus, and the Middle East. According to Tokayev, cargo volumes along the Middle Corridor have risen fivefold over the past six years, from 0.8 million tons to 4.1 million tons annually, with Kazakhstan targeting a capacity of 10 million tons. He said Kazakhstan has invested more than $35 billion in transport and logistics infrastructure over the past 15 years, with the Caspian ports of Aktau and Kuryk serving as major transit gateways. Tokayev also welcomed logistics agreements worth nearly $1 billion signed on June 23 by the Development Bank of Kazakhstan: one with the European Investment Bank, and a separate agreement with a banking syndicate including Commerzbank, JPMorgan Chase, and Standard Chartered, backed by guarantees from the Multilateral Investment Guarantee Agency (MIGA). A day earlier, Kazakhstan and European partners announced four transport-related agreements worth...