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Bilateral Trade

Kazakhstan’s Trade with China Is Growing, but the Deficit Is Widening

Kazakhstan’s trade and economic ties with China continue to deepen, yet the expansion in bilateral trade is accompanied by a widening imbalance. By the end of 2025, China had consolidated its position as one of the country’s key trading partners, accounting for nearly a quarter of total foreign trade turnover. According to data from the analytical centre of the Association of Financiers of Kazakhstan (AFK), bilateral trade reached $34.1 billion, an increase of 13.2% compared with the previous year. China’s share in Kazakhstan’s foreign trade rose to 23.7% from 21.2% a year earlier. Growth in trade was driven primarily by an increase in imports of Chinese goods. In 2025, imports from China reached $18.9 billion, 23.6% higher than the previous year. China accounted for 29.2% of all imports into the country. The structure of imports indicates growth in shipments of both consumer goods and industrial products. The largest increases were recorded in vehicles (+$3.4 billion), metals (+$645 million), and chemical products (+$412 million). According to analysts, this reflects expanding investment activity, infrastructure projects, and domestic demand. In contrast to imports, Kazakhstan’s exports to China showed only moderate growth, rising by 2.1% to $15.2 billion. At the same time, the export structure changed. Shipments of agricultural and chemical products increased, while exports of traditional raw materials declined. Experts attribute this to cooling industrial demand in China, lower global commodity prices, and growth in domestic production within China itself. Faster growth in imports led to a sharp deterioration in the trade balance. According to AFK data, the bilateral trade deficit with China increased tenfold, from $370 million to $3.7 billion. At the same time, price trends for goods imported from China remained largely downward. Declining prices for a number of items are linked to low inflation in China and increased competition from Chinese manufacturers in foreign markets. This, in turn, is exerting a restraining effect on inflation in Kazakhstan, partially offsetting price increases driven by domestic factors such as tariffs, demand, and budget spending. In the short term, analysts expect imports from China to remain the main driver of bilateral trade. Kazakhstan’s exports, meanwhile, will depend on commodity prices and the level of industrial demand in China. High oil prices (above $100 per barrel) could temporarily reduce the deficit by boosting export revenues. However, this effect would be largely price-driven and is unlikely to change the overall structure of trade.

Economic Growth

Central Asia Records Over 6% Growth as Trade with Russia Expands

Central Asian economies concluded 2025 with growth exceeding 6%, significantly outpacing major developed markets such as the United States and the Eurozone, where expansion stood at approximately 1.6% and 1.1%, respectively, according to Turkish newspaper Yeni Şafak. The figure aligns with the World Bank who puts regional expansion at 6.2% and the Eurasian who Development Bank (EDB) estimates growth at 6.6%. Economists attribute the region’s performance to strong domestic demand, active state investment programs, infrastructure development, and rising exports of raw materials and industrial goods. Kazakhstan and Uzbekistan accounted for the largest contributions to overall growth, supported by large-scale public investment initiatives and expanding foreign trade. By contrast, the U.S. and European economies experienced slower growth amid high interest rates, inflationary pressures, and weaker consumer demand. Uzbek economist Mirkomil Kholboyev, writing on his Telegram channel, said the trend reflects deeper structural factors. “In general, the average real growth in Central Asia has almost always been higher than in the United States or Europe, with the exception of 2021,” he wrote. “Beyond short-term effects, lower-income countries like ours tend to grow faster than high-income economies. In wealthier countries, the return on additional capital has declined, while in our region capital remains scarce, allowing investments to generate higher returns. Demographic growth is also higher here, and the steady expansion of the labor force serves as an additional driver of economic growth.” Trade data indicate that Central Asia’s economic ties with Russia have strengthened in recent years. In 2021, the region accounted for 3.2% of Russia’s imports. By the first 10 months of 2025, that share had risen to 4.6%. Over the same period, Central Asia’s share of Russian exports increased from 5.6% to 7%. Overall, during the first 10 months of 2025, Central Asia ranked as Russia’s third-largest import partner and fourth-largest export destination. Before the war in Ukraine, the region ranked seventh among Russia’s import partners and fourth in exports. Although Russia’s economy remains significantly larger, reaching approximately $2.1 trillion in 2024 and exceeding the combined size of Central Asian economies by about 4.4 times, the increase in trade shares over the past four years is notable. Kholboyev also noted that part of the rise in imports is attributable to re-export activity.

Uzbek-U.S. Relations

Uzbekistan and United States to Establish Investment Platform

Shavkat Mirziyoyev has arrived in Washington with his spouse on a working visit that includes participation in the first summit of the Board of Peace and a series of business engagements aimed at strengthening bilateral economic ties. According to the presidential press service, the visit is focused on expanding trade, investment, and financial cooperation with U.S. partners. As part of his program in Washington, Mirziyoyev met with John Jovanovic, President and Chairman of the Export-Import Bank of the United States, and Ben Black, Chief Executive Officer of the U.S. International Development Finance Corporation. The discussions centered on expanding financial support for priority industrial and infrastructure projects in Uzbekistan. Officials noted that negotiations held last year with U.S. President Donald Trump gave new impetus to trade and investment cooperation. In particular, the two sides reviewed progress in supporting the activities of the bilateral Business Council and advancing plans to launch an Investment Platform intended to promote major projects on a systematic basis. Cooperation with the Export-Import Bank is expected to include increased financing for large-scale industrial and infrastructure initiatives, as well as assistance with the supply of high-technology equipment. During talks with the Development Finance Corporation, emphasis was placed on strengthening investment mechanisms and facilitating the corporation’s participation in national and regional projects, including the development of Uzbekistan’s financial market and energy sector. At the conclusion of the meetings, the parties exchanged an Agreement on the Establishment of an Investment Platform between Uzbekistan and the United States in the presence of the Uzbek president. The current visit builds on steps taken last November, when Uzbekistan announced the creation of the Uzbekistan-U.S. Business and Investment Council. The body was formalized by presidential decree following Mirziyoyev’s official visit to Washington within the C5+1 framework. The council is jointly chaired by senior representatives of both countries and is designed to serve as an institutional mechanism for deepening commercial cooperation. During his Washington meetings, Mirziyoyev also invited the American side to participate in the upcoming Tashkent International Investment Forum, underscoring continued efforts to attract U.S. business engagement in Uzbekistan’s economic reforms.

Trade

Kyrgyzstan Ready to Act as a ‘Gateway’ for Tajik Goods to EAEU and EU Markets

On February 13 in Bishkek, Chairman of the Cabinet of Ministers of Kyrgyzstan Adylbek Kasymaliev and Prime Minister of Tajikistan Kokhir Rasulzoda held the first meeting of the Kyrgyz-Tajik Intergovernmental Council. Opening the session, Kasymaliev said that 2025 marked a historic milestone in bilateral relations, citing the completion of the delimitation process of the Kyrgyz-Tajik border. He described the agreement as “a decisive factor in strengthening security and stability not only in our countries but also in the entire region.” Addressing trade and economic cooperation, Kasymaliev stated that Kyrgyzstan is ready to expand supplies of meat and dairy products, clothing and textiles, coal, glass, and sugar to Tajikistan. According to official figures, bilateral trade turnover reached $36 million in 2025, representing a nearly 24-fold increase compared to 2024. Both sides have set a target of increasing annual trade to $500 million. In the field of transport and logistics, Kasymaliev emphasized the need to improve border infrastructure and enhance the efficiency of checkpoints. Proposed measures include modernizing existing border crossings, expanding capacity, developing logistics and cargo terminals, and introducing digital solutions in customs and border administration. “Kyrgyzstan is ready to act as a trade gateway for Tajik goods to the markets of the Eurasian Economic Union (EAEU), as well as the European Union through the Generalised Scheme of Preferences Plus (GSP+),” Kasymaliev said. He also highlighted the strategic China-Kyrgyzstan-Uzbekistan railway project, which he said would significantly increase Kyrgyzstan’s transit potential and strengthen its role as a logistics hub in Eurasia. According to the Kyrgyz prime minister, the new transport corridor will create additional opportunities for Tajikistan. Kasymaliev further noted positive dynamics in tourism cooperation. In 2025, 86,000 tourists from Tajikistan visited Kyrgyzstan, a 12-fold increase compared to 2024. Kyrgyzstan reaffirmed its interest in developing joint tourism initiatives, including the possible introduction of a unified visa for third-country nationals traveling across Central Asia. Rasulzoda stated that Tajikistan places particular importance on good-neighborly relations and mutually beneficial cooperation with Kyrgyzstan, confirming readiness to further strengthen the partnership. As part of his visit to Bishkek, Rasulzoda toured a recently opened waste-to-energy plant constructed by a Chinese company. He described the facility as a promising example of modern waste recycling and expressed Tajikistan’s interest in implementing similar projects.

EAEU

Tokayev Sets Agenda for Kazakhstan’s 2026 EAEU Chairmanship

Kazakhstan has assumed the rotating chairmanship of the Eurasian Economic Union (EAEU) for 2026, pledging to focus on digital transformation, logistics integration, and the removal of internal trade barriers across the bloc. In a statement published on December 31, 2025, President Kassym-Jomart Tokayev outlined five key priorities for Kazakhstan’s EAEU presidency. The EAEU includes Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia, and facilitates the free movement of goods, services, capital, and labor among its members. Artificial Intelligence and Economic Integration Tokayev identified artificial intelligence (AI) as a vital tool for deepening integration within the bloc. AI technologies, he said, are already being used to forecast trade flows and assess the impact of tariffs and trade agreements on member economies. Kazakhstan, which has set a national goal of becoming a digital nation, expressed readiness to share its expertise with other EAEU members in areas such as AI, digital regulation, and economic transformation. Tokayev proposed the adoption of a Joint Statement on the Responsible Development of Artificial Intelligence at the 2026 Eurasian Economic Forum in Astana. The document would define a new framework for digital cooperation within the bloc. Positioning the EAEU as a Eurasian Logistics Hub Highlighting the EAEU’s geographic position as a natural bridge between East and West, Tokayev called for transforming the bloc into a leading logistics hub for the Eurasian continent. He emphasized the need to modernize transport, customs, and logistics infrastructure, and to develop international transport corridors and multimodal transport solutions. He also proposed an integrated, AI-based cargo flow management system across the EAEU to reduce delivery times, cut costs, and enhance the bloc’s global competitiveness in logistics. Digitalizing Industry and Agriculture Calling industry and agriculture the economic foundation of the EAEU, Tokayev urged deeper cooperation to produce globally competitive products. While financial mechanisms for joint projects already exist, he argued that more emphasis should be placed on innovation-led initiatives. He proposed launching demonstration centers, automation startups, and competence hubs to drive digitalization at both enterprise and farm levels. Barrier-Free Trade as a Core Principle Tokayev stressed the elimination of administrative and regulatory barriers within the bloc as a central priority. He criticized artificial restrictions on trade, constraints on the movement of citizens, and long freight queues at borders. He also warned against the use of customs procedures and regulatory controls, including sanitary, veterinary, and phytosanitary measures, as tools of political or economic leverage. To address this, he proposed deploying AI to monitor legislative initiatives across the EAEU and flag potential internal trade barriers at an early stage. Expanding External Economic Ties Kazakhstan’s chairmanship will also focus on expanding the EAEU’s external partnerships. In 2025, the bloc signed Free Trade Area agreements with Mongolia and Indonesia and concluded an Economic Partnership Agreement with the United Arab Emirates. Tokayev said greater attention will be paid to building economic ties with countries in the Global South, the Arab world, Southeast Asia, Africa, and regional economic organizations. Macroeconomic Context Tokayev’s agenda is being launched against a backdrop of solid macroeconomic performance...

Afghanistan

Kyrgyzstan Expands Trade Access to Afghan Market

Kyrgyzstan and Afghanistan have taken a significant step toward deepening economic ties with the opening of the Trade House of the Kyrgyz Republic in Kabul on December 16. The launch ceremony was attended by Kyrgyz Minister of Economy and Commerce Bakyt Sydykov and Afghan Minister of Industry and Commerce Nooruddin Azizi. According to the Kyrgyz Ministry of Economy and Commerce, the new Trade House is intended to serve as a platform for promoting Kyrgyz exports, facilitating direct business connections between entrepreneurs from both countries, and expanding bilateral trade. The Kyrgyz delegation also participated in a Kyrgyz-Afghan business conference on December 17 in Kabul, organized by the Afghanistan Chamber of Commerce and Investment. Speaking at the event, Azizi announced Afghanistan’s intention to open its own Trade House in Bishkek, describing Afghanistan and Kyrgyzstan as “interconnected countries” with complementary positions in regional trade. He characterized Kyrgyzstan as a gateway to Central Asia and the Eurasian Economic Union, and Afghanistan as a strategic hub linking South and West Asia. The conference concluded with the signing of commercial contracts worth $157 million between Kyrgyz and Afghan companies. Bilateral trade has gained momentum since Kyrgyzstan removed the Taliban from its list of prohibited organizations in September 2024. At the time, the Kyrgyz Ministry of Foreign Affairs stated that the decision was intended to support regional stability and constructive dialogue. According to Afghanistan’s Ministry of Industry and Commerce, bilateral trade reached $66 million in the most recent solar year (March 2024-March 2025), with Afghan exports totaling $7 million. Key Afghan exports to Kyrgyzstan include aluminum and copper utensils, pressure cookers, carpets, fruits, and vegetables. Kyrgyzstan is a significant supplier of petroleum products to the Afghan market. In a further move to strengthen its regional trade presence, Kyrgyzstan secured a pavilion at the Termez International Trade Center in November 2024. Located in Termez, Uzbekistan, near the Afghan border, the Center serves as a key node in regional trade routes, particularly between Uzbekistan and Afghanistan. The Kyrgyz pavilion offers a strategic foothold to further expand access to the Afghan market.