Page 389 – The Times Of Central Asia

06 Feb 2025

Business & Economy, Kyrgyzstan, Kyrgyzstan Business & Economy

Kyrgyzstan Economy at Risk of Stagnation, Warns World Bank

February 6, 2025
By Anton Chipegin

The World Bank has released a new report on the economic development of Kyrgyzstan and the broader Central Asian region. While the report acknowledges that Kyrgyzstan’s economy is growing at a steady pace, it warns that this growth is insufficient to propel the country to the next stage of development.

The report, prepared in collaboration with the Kyrgyz Ministry of Economy and Commerce, outlines a three-stage approach to advancing the national economy. According to David Knight, a leading economist at the World Bank, Kyrgyzstan should prioritize investment, the adoption of new technologies, and innovation. The World Bank also recommends that the government focus on improving education, strengthening the private sector, and reforming energy policy.

“Kyrgyzstan’s economy is currently showing strong indicators. However, these are not enough to facilitate a transition to the next level of development. As experience shows, it is only a matter of time before economic growth slows. The key question is whether the authorities can sustain momentum,” Knight said.

Ivaylo Izvorski, the World Bank’s Chief Economist for Europe and Central Asia, told The Times of Central Asia that Kyrgyzstan needs targeted investments — or “point injections” — in key sectors, particularly industry and energy.

“Why is it so difficult to transition from middle-income to high-income status? One reason is that countries cannot simply shift from investment-driven growth to innovation-driven growth overnight. The right technologies must first be introduced into the economy, and only then can innovation take hold,” Izvorski explained.

The World Bank has also raised concerns about Kyrgyzstan’s energy sector, particularly its pricing policies. Despite recent increases in electricity and heating costs, World Bank experts argue that tariffs remain artificially low and heavily subsidized, which could hinder long-term development.

“If electricity costs 10 cents per unit but consumers pay only 3 cents, it leads to waste and inefficiencies. State subsidies, the monopoly of state-owned enterprises, and market distortions continue to obstruct energy sector reforms,” Izvorski said.

The report also highlighted the need for education reform. The World Bank advises Kyrgyz authorities to raise educational standards, particularly in higher education, to support a more skilled workforce. To achieve this, universities and vocational schools should strengthen partnerships with industrial enterprises, while university funding should be tied to institutional performance.

06 Feb 2025

Business & Economy, Uzbekistan, Uzbekistan Business & Economy, Uzbekistan International Affairs

Uzbekistan to Import Afghan Coal in $4.5 Million Trade Deal

February 6, 2025
By Sadokat Jalolova

Uzbekistan has agreed to import coal from Afghanistan as part of efforts to balance bilateral trade, Tasnim News Agency reported.

During a meeting in Kabul, an Uzbek delegation expressed its readiness to purchase Afghan coal, resulting in the signing of trade agreements worth $4.5 million between private companies from both countries. The discussions also covered trade privileges, plans to construct a cement plant in Afghanistan’s Samangan region, and the organization of joint exhibitions.

In May 2024, Uzbekistan’s Transport Minister, Ilhom Mahkamov, led a delegation to Afghanistan, where he met with Foreign Minister Amir Khan Muttaqi. During the talks, both sides agreed that a technical team would visit Kabul to finalize the purchase of over one million tons of coal.

Meanwhile, in July 2023, the Kyrgyz government raised the price of coal exported to Uzbekistan by 37%. According to the National Statistics Committee of Kyrgyzstan, from January to May 2024, Kyrgyzstan exported 302,000 tons of coal to Uzbekistan for $12.7 million—1,000 tons less than the same period in 2023, when 303,000 tons were sold for $9.2 million. Kyrgyz coal suppliers have not commented on the price increase.

This week, business representatives from Uzbekistan and Afghanistan signed a $4.5 million trade agreement. Afghanistan’s Ministry of Industry and Trade announced the deal, stating that it was signed by private sector representatives from both countries.

06 Feb 2025

International Affairs, Kyrgyzstan, Kyrgyzstan International Affairs, Kyrgyzstan Business & Economy

Kyrgyzstan Facilitates Group Travel Tourism from China

February 6, 2025
By Sergey Kwan

On February 4, Kyrgyzstan’s Ministry of Economy and Commerce and China’s Ministry of Culture and Tourism signed a memorandum in Beijing aimed at facilitating organized group travel from China to Kyrgyzstan.

The agreement was signed during Kyrgyz President Sadyr Japarov’s state visit to China and is expected to boost Kyrgyzstan’s tourism industry and contribute to economic growth. According to Kyrgyzstan’s Ministry of Economy and Commerce, 127,956 Chinese citizens visited the country in 2024, marking a 56% increase from 70,842 visitors in 2023. China has also included Kyrgyzstan on its list of recommended destinations for individual Chinese travelers.

In October 2024, Kyrgyzstan introduced a visa-free regime for organized Chinese tour groups for stays of up to 21 days. The move aims to strengthen Kyrgyz-Chinese public diplomacy and enhance the country’s appeal to one of the world’s largest outbound tourism markets.

Kyrgyzstan’s tourism industry has been experiencing steady growth in recent years. The country was expected to welcome more than 10.5 million foreign tourists in 2024, up from 8.5 million in 2023. In the first eight months of 2024, Kyrgyzstan recorded 6.1 million foreign visitors, with the majority coming from Uzbekistan, Kazakhstan, and Russia. Other significant sources of tourists included Turkey, China, India, Germany, Pakistan, the United States, and South Korea.

06 Feb 2025

Home, Justice, Kazakhstan Justice, Features, Kazakhstan Featurees

In Azerbaijan, Anger Toward Russia Simmers After Plane Crash Report

February 6, 2025
By Times of Central Asia

Commentators in Azerbaijan have reacted to a preliminary report on the Dec. 25 crash of an Azerbaijan Airlines plane with another round of scathing criticism of Russia, which Azerbaijan accuses of accidentally firing on the aircraft from the ground.

The report that was released on Tuesday by Kazakhstan, where the passenger plane crashed after diverting from a planned landing in Russia, did not clear up whether Russia had fired on the plane, saying only that objects that were not part of the plane had struck it and caused significant damage. While a full report is in the works, that could take many more months, during which time tensions between Azerbaijan and Russia are likely to stew or escalate unless Azerbaijan gets the full apology and accountability that it demands.

Some analysts in Azerbaijan are already fuming about what they characterize as an evasive statement by Russian civil aviation authority Rosaviatsiya about the preliminary report on the crash that killed 38 out of the 67 people on the plane.

The Russian statement on Telegram noted that the report “does not contain conclusions about the causes of the incident” and acknowledged that the plane was damaged by external impacts.

“However, the report does not indicate that the Kazakh side identified foreign objects inside the aircraft, while the Russian Federation has not yet had the opportunity to examine these elements, as they have not been handed over for expert analysis,” Rosaviatsiya said.

The statement also notes that the crew of the Azerbaijan Airlines plane on the Baku-Grozny route “independently” decided to divert to Aktau, Kazakhstan, even though Russian air traffic controllers had proposed other Russian airports for landing. Lastly, it says the pilots of the Embraer 190 aircraft told Russian air traffic controllers that there had been a bird strike and an oxygen cylinder explosion on the plane, theories that have been widely attributed to the pilots’ confusion at the time and have since been almost entirely discredited.

“This means that the Russian side is still clinging to the crew’s assumptions as a lifeline. While Baku does not accuse Moscow of deliberately downing the aircraft, it is strongly urging Russia to take responsibility,” Samir Veliyev wrote in an analysis on Caliber, a Baku-based news organization.

“The situation as it stands today clearly shows that it is becoming increasingly difficult for the Russian side to deny its involvement in the incident. So why drag this out? Baku will not back down from its already stated position, which is based on irrefutable facts,” Veliyev wrote.

Another news outlet in Azerbaijan, aze.media, said Russia knew about the investigation results in advance and could have acknowledged its alleged role.

“But instead, the Kremlin, as always, chose the ‘we know nothing’ tactic and decided to simply ignore the obvious,” aze.media said in an opinion piece.

Numerous aviation and security specialists have said damage to the plane’s fuselage is consistent with shrapnel marks. Russian President Vladimir Putin has apologized to his Azerbaijani counterpart, Ilham Aliyev, in a phone conversation. However, the Russian leader did not acknowledge that the aircraft had been accidentally hit by Russian fire before diverting to Aktau. Russia has said the area was under attack by Ukrainian drones at the time.

Kazakhstan is leading the investigation, which includes representatives from Azerbaijan, Russia and Brazil, where Embraer planes are made. The Canada-based International Civil Aviation Organization, a United Nations agency that oversees aviation safety, is also involved.

06 Feb 2025

Business & Economy, Uzbekistan, Kazakhstan, Uzbekistan Business & Economy, Kazakhstan International Affairs, Kazakhstan Business & Economy, Uzbekistan International Affairs

Kazakhstan’s Parliament Approves Regulations for the Central Asia International Industrial Cooperation Center with Uzbekistan

February 6, 2025
By Sergey Kwan

On February 5, the Mazhilis, the lower house of Kazakhstan’s parliament, approved an agreement between the governments of Kazakhstan and Uzbekistan on regulations for the Central Asia International Center for Industrial Cooperation.

According to Kazakhstan’s Ministry of Trade and Integration, the industrial center will be built along the border of the two countries, near the Gulistan checkpoint in Uzbekistan and the Atameken checkpoint in Kazakhstan. The complex will include:

Industrial production facilities
Warehouses
Transport infrastructure

The center aims to:

Accelerate cargo transportation
Reduce logistics costs
Streamline supply chains
Lower product costs for consumers
Enhance industrial cooperation between Kazakhstan and Uzbekistan as part of the North-South corridor

Kazakhstan’s Minister of Trade and Integration, Arman Shakkaliyev, informed parliament that the industrial center will cover 100 hectares, with 50 hectares on each country’s side. Part of the center will receive regional industrial zone status.

Construction is expected to be completed by the fourth quarter of 2026, with an official opening planned for the first half of 2027. Uzbekistan is one of Kazakhstan’s largest economic and trading partners, and both countries aim to increase bilateral trade to $10 billion annually in the medium term.

06 Feb 2025

Home, Kyrgyzstan, Opinions, Kyrgyzstan Opinions, Kyrgyzstan Features

Guest Opinion: The View From China on Kyrgyzstan

February 7, 2025
By Times of Central Asia

The 9th Asian Winter Games will kick off in Harbin on February 7, 2025. According to the organizing committee, 1,275 athletes from 34 Asian countries and regions have registered to compete, making it the largest event in the event’s history.

The record-high participation partly reflects the growing appeal of winter sports across Asia and showcases the continent’s diversity and unity. Among those attending the event is the delegation from Kyrgyzstan, which is sending around 50 athletes to compete in biathlon, alpine skiing, figure skating, ice hockey, and curling.

As this edition of the Asian Winter Games is set to open, the spotlight is not just on the athletes from across the continent, but also on the broader regional ties the event symbolizes. Indeed, in a world where the level of geopolitical uncertainties is high, some partnerships stand the test of time.

At the invitation of Chinese President Xi Jinping, Kyrgyz President Sadyr Japarov will pay a state visit to China from February 4 to 7.

Over the past three decades or so, China and Kyrgyzstan have navigated global challenges while steadily strengthening their ties. Through frequent high-level exchanges and growing cooperation across multiple sectors, the two nations have built a bond that’s only grown stronger over the past three decades. At the heart of this partnership are Chinese President Xi Jinping and Kyrgyz President Sadyr Japarov, whose meetings over the years have deepened mutual trust.

Back in February 2022, Japarov visited China to attend the Beijing Winter Olympics opening ceremony and held talks with Xi. Later that year, in September, they met again at the Shanghai Cooperation Organization (SCO) Summit in Samarkand.

In 2023, Japarov made a state visit to China and attended the China-Central Asia Summit. It was during this visit that both nations decided to elevate their ties to a comprehensive strategic partnership for a new era.

Their most recent bilateral meeting took place in July 2024 during the SCO Summit, with Japarov’s state visit to China now taking place from February 4 to 7.

Economic Ties

China has consistently been Kyrgyzstan’s top trading partner – primary import-based – and biggest investor. The two nations continue to strengthen cooperation in energy, transportation, and agriculture, driving regional economic integration. Chinese enterprises in construction, oil refining, cement, and mining have been investing in Kyrgyzstan over the years, and their investments yield tangible results.

Trade between China and Kyrgyzstan has been on an upward trajectory. From January to November 2024, bilateral trade reached $19.86 billion, an 11% increase year-on-year, showcasing a positive trend in economic cooperation.

A long-anticipated project, the China-Kyrgyzstan-Uzbekistan (CKU) railway, has finally moved from vision to reality. Once completed, this railway will serve as a crucial trade corridor, enhancing regional connectivity and providing a major boost to Kyrgyzstan’s economic development.

Additionally, the partial opening of the Bedel Pass, increasing direct flights between Chinese and Kyrgyz cities, and improved cross-border transportation all contribute to smoother trade and travel between the two countries.

Chinese-funded infrastructure projects, such as road network upgrades, the new North-South Highway, and irrigation system improvements, are bringing real benefits to Kyrgyz citizens.

China also remains Kyrgyzstan’s top automobile supplier. According to Kyrgyzstan’s National Statistics Committee, from January to October 2024, the country imported 113,000 vehicles, a 12.5% decrease from the previous year. Among them, 55,000 came from China, making up 48.7% of total imports, followed by South Korea at 29.2%.

Another promising development is Kyrgyzstan’s adoption of new electric vehicles. With rapid urbanization in Bishkek, traffic congestion and pollution have become a growing challenge. Over the past year, Chinese-made electric buses have provided a green solution, helping ease congestion while supporting the city’s environmental goals.

At the China-Central Asia Summit in Xi’an in 2023, President Japarov signed an agreement to purchase 1,000 electric buses from Chinese manufacturers. All have now been delivered to Bishkek. The city’s transport authority has praised the eco-friendly buses, aligning with Bishkek’s vision for sustainable urban development.

Kyrgyzstan, located at a key junction of the Belt and Road Initiative, has developed into a major trade hub in Central Asia. Before 2019, Bishkek residents would visit local markets for shopping. Now, many prefer the convenience of online shopping via international platforms that China-based technology giants provide.

Cultural and Educational Exchange

Cultural and educational ties between China and Kyrgyzstan are also flourishing. The two countries regularly organize “Cultural Days” and other exchange programs. China has established four Confucius Institutes in Kyrgyzstan, hosting 21 Confucius classrooms. Additionally, 28 Chinese and Kyrgyz cities and provinces have formed sister-city relationships, further deepening people-to-people connections.

Interest in the Chinese language continues to grow in Kyrgyzstan, with initiatives like the Luban Workshop providing practical training for students. Mutual cultural centers and medical aid projects, such as the “Health Express” initiative, have strengthened goodwill between both nations.

Chinese restaurants are also welcomed in Bishkek, enriching local culinary culture, while Kyrgyz honey and dried fruits have gained popularity among Chinese consumers.

A Promising Future

The momentum behind China-Kyrgyzstan relations comes from a shared vision for progress.

With President Xi and President Japarov providing strong leadership, major Belt and Road projects serving as economic engines, and broad participation from various sectors, the foundations look strong, and the best chapters of this relationship are yet to be written.