Economic Cooperation - The Times Of Central Asia

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International Relations

Rahmon Invites German Chancellor to Cooperate on Rogun HPP

During the summit of Central Asian countries and Germany on September 17 in Astana, Tajik President Emomali Rahmon spoke with German Chancellor Olaf Scholz on expanding Tajikistan’s cooperation with Germany and furthering Germany's business interests in the country. The president noted the significant contribution made by the German Society for International Cooperation and the German Development Bank to Tajikistan's implementation of its national strategies. With regard to future projects, the parties discussed developing effective cooperation in economy and trade, industry, hydropower, solar and wind energy, transport, and agriculture. The two leasers also exchanged views on mining and processing minerals and scarce earth metals, the expansion of bilateral cooperation in industry and agriculture, and the prospects of exporting products from Tajikistan to Germany. Talks also covered global problems related to drinking water, melting glaciers, climate change, and food security. Olaf Scholz confirmed Germany's interest in cooperating with Tajikistan in energy fields, including hydropower and other green energy sources, mining, environmental protection, and security, and emphasized, “we encourage cooperation with Tajikistan to global German companies." According to the president's press service, Emomali Rahmon recalled Germany’s contribution to the construction of the Tajikistan and Sebzor power plants in Badakhshan and the modernization of the Nurek hydroelectric power plant. Looking ahead, the president expressed confidence that such cooperation could continue on the Rogun power plant. The estimated cost of completing the construction of the Rogun HPP is $6.4 billion, and when fully operational, about 70% of the electricity produced will be exported to other Central Asian countries. The meeting closed with Rahmon inviting Scholz to come to Tajikistan on an official visit.

International Relations

Mirziyoyev and Scholz Agree to Grow Uzbekistan-Germany Cooperation

On September 15, German Chancellor Olaf Scholz met with Uzbek president Shavkat Mirziyoyev in Samarkand. Last year the volume of trade between Uzbekistan and Germany exceeded 1 billion euros for the first time. Since the beginning of 2024, German companies have invested over 800 million euros into the Uzbek economy, while in June, the eighth meeting of the Uzbek-German Business Council was successfully held in Tashkent. At the end of the negotiations, Mirziyoyev and Scholz signed eight bilateral documents, including agreements in the fields of migration, use of water resources, essential minerals, transport and climate change. Additionally, Mirziyoyev and Scholz participated in the opening ceremony of the new Academy of Public Administration, which the Uzbek government has recently built in cooperation with the Hans Seidel Foundation and the Bavarian School of Public Administration. Scholz will also participate in a C5+1 meeting in Kazakhstan on September 17 with the leaders of Kazakhstan, Kyrgyzstan, Uzbekistan, Turkmenistan, and Tajikistan.

International Relations

Uzbekistan Signs Customs Agreement With U.S.

The heads of the Uzbek and American customs services have signed an agreement “On Cooperation and Mutual Assistance,” an essential legal basis of cooperation in customs. The deal was signed in a bilateral meeting between the Chairman of the Uzbekistan's Customs Committee, Akmalkhuja Mavlonov, and the Commissioner of the U.S. Customs Border Service, Troy Miller. Prior to Uzbekistan, the United States had signed such bilateral agreements on customs cooperation with only 17 other countries. After establishing diplomatic relations between Uzbekistan and the USA, an official face-to-face meeting between the heads of the customs services of the two countries is being held for the first time in the past 32 years. Uzbekistan’s foreign trade in goods with the USA has increased by 48% in the last six years. In the first eight months of this year, this indicator increased by 64% compared to 2023. Establishing cooperation and information exchange between the two countries' customs services can further increase foreign trade. That’s why negotiations focused on urgent issues such as risk monitoring in customs, digitalization of customs procedures, and effective use of human resources. The negotiations addressed the potential for U.S. Border and Customs Service specialists to be brought to Uzbekistan, as well as opportunities for Uzbek specialists to enhance their skills in the United States. The Times of Central Asia has previously written that an American think tank, the Center for Strategic and International Studies (CSIS), has recently called on American politicians to turn Uzbekistan into a valuable partner.

Bilateral Cooperation

Kara-Suu Crossing Reopens on Kyrgyz-Uzbek Border

On September 12, the Kara-Suu checkpoint was reopened at the border between Kyrgyzstan and Uzbekistan. Located near the town of Kara-Suu in Kyrgyzstan’s southern Osh region, on the border with Uzbekistan’s Andijan region, the Kara-Suu crossing was closed 14 years ago. It has reopened amid the two neighboring states' improved political and economic relations. Speaking at the checkpoint's opening ceremony, Bakyt Torobaev, the Deputy Chairman of Kyrgyzstan’s Cabinet of Ministers, emphasized that its reopening will be beneficial to citizens of both countries. "Previously, many Kyrgyz and Uzbek citizens had to stand in lines at the Dostuk checkpoint to cross the border. The opening of Kara-Suu will solve the problem of queues when crossing the border. The opening of this checkpoint is an important step towards strengthening economic, social, and cultural ties between our countries and increasing tourist flows," Torobaev said. On the same day, the renovated Ken-Sai and Uch-Kurgan border checkpoints were opened between the Jalal-Abad region in Kyrgyzstan and the Namangan region of Uzbekistan. According to official statistics, more than 14 million people crossed the Kyrgyz-Uzbek border in 2023, and in the first eight months of 2024, this figure reached 11 million, 1.5 million more than in the same period last year. In 2023, trade between Kyrgyzstan and Uzbekistan amounted to $693.6 million. In the first seven months of 2024, it reached $428 million, a 6.7% increase compared to the same period in 2023. During a state visit to Uzbekistan back in July, Kyrgyzstan’s President Sadyr Japarov and Uzbek President Shavkat Mirziyoyev focused on measures to increase bilateral trade to $2 billion in the coming years and launch a “green-light corridor” for the transportation of agricultural produce between the two countries.

Civil Aviation

German Company to Assemble Airplanes in Almaty

The German company "Linding Group" is set to invest about $10 million in assembling airplanes in Almaty, pending necessary permits from the government. Based in the economic zone “PIT ‘Alatau", production will begin in 2026. During the first year, 20 airplanes will be assembled, rising to 50 units annually thereafter. Kazakhstan is already engaged in several joint projects with foreign enterprises in aircraft production. One such project involves the "Russian Helicopters" company. Within the framework of the agreement with Kazakhstan's aircraft repair plant No. 405, a large-unit assembly of Mi-8AMT and Mi-171E helicopters was launched in Almaty, predominantly serving the Ministry of Emergency Situations and the National Guard of Kazakhstan. A further example of international cooperation is the contract between the Ural Civil Aviation Plant and Kazakhstan Aviation Industry (KAI) to produce the Baikal multi-purpose airplane. When fully assembled by the end of this year, the airplanes will be delivered to markets in Europe and Africa. The realization of all of these projects will both strengthen Kazakhstan's aviation industry and increase its presence in international aviation markets.

Energy

Russia to Join Central Asia’s Unified Energy System

Russian Energy Minister Sergey Tsivilev has announced that the Russian and Uzbek energy ministries have agreed to connect the Russian “System Operator” to Central Asia's Unified Energy System (UES). The connection itself is expected to happen soon. Uzbekistan's Minister for Energy, Zhurabek Mirzamakhmudov, has commented that this move will ensure the security and stability of the energy system in the region. These measures are expected to allow prompt response to problems in energy supply and avoid interruptions. In addition, Inter RAO has announced that it is preparing to export electricity to Uzbekistan, with the start of supplies scheduled for this fall. Central Asia's Unified Energy System was created in the 1970s. It is managed by the coordination and dispatch center in Tashkent, and allows the balancing of seasonal fluctuations in demand for electricity and water needs during the irrigation period. It currently includes Uzbekistan, Kyrgyzstan, Kazakhstan and Turkmenistan. In May it became official that Tajikistan would join the system.