economic ties - The Times Of Central Asia

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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.

economic ties

Kyrgyzstan Seeks to Deepen Economic Ties with Germany

On November 28, Berlin hosted the Kyrgyz-German Business Forum and the fifth meeting of the Kyrgyz-German Business Council, with the participation of Adylbek Kasymaliev, Chairman of the Cabinet of Ministers of Kyrgyzstan. The event was organized by Kyrgyzstan’s National Investment Agency, the Eastern Committee of the German Economy, and the German Chamber of Commerce and Industry. It brought together over 300 participants from government agencies, financial institutions, and business sectors of both countries. Key areas of cooperation included the implementation of a dual vocational education system based on the German model, legal and organized labor migration from Kyrgyzstan to Germany, and joint projects in energy, green technologies, information technology, and agriculture. During the forum, Kasymaliev called on German companies to deepen engagement with Kyrgyzstan, from supplying equipment to investing in sustainable and green development initiatives. The primary purpose of Kasymaliev’s visit was to launch the second cycle of the “Days of the Economy of Kyrgyzstan and Germany,” a bilateral initiative aimed at strengthening economic cooperation and attracting foreign investment. At the Business Council meeting, Kasymaliev outlined three priority areas for collaboration. The first is financial and banking integration. He proposed establishing direct correspondent banking relationships between Kyrgyz and German financial institutions to enhance trade transparency, expedite transactions, and ensure greater security in bilateral trade. The second priority is cooperation in education and vocational training. Kyrgyzstan seeks to expand partnerships between universities, vocational schools, and industry centers, as well as to develop academic exchange and joint educational programs modeled on Germany’s experience. The third area of focus is labor migration. “Kyrgyzstan proposes to jointly develop targeted training programs, including professional and language training, as well as mechanisms for recognizing professional qualifications,” Kasymaliev stated. He emphasized that such cooperation would ensure fair working conditions and safeguard the rights of Kyrgyz citizens while addressing labor shortages in Germany. On November 29, Kasymaliev also visited the international postal exchange center of Kyrgyz Pochtasy (Kyrgyz Post) OJSC in Berlin. He noted that the establishment of such a center in the heart of Europe represents an important step toward boosting Kyrgyzstan’s export potential and expanding access for Kyrgyz businesses to European markets.

Foreign Affairs

Washington Steps Up Focus on Central Asia Amid Strategic Competition with China

The United States has intensified its interest in Central Asia following China’s decision to restrict exports of rare earth elements. Amid the broader U.S.–China trade rivalry, Washington is seeking to diversify its sources of strategic raw materials and strengthen economic ties with countries in the region. Analysts note that Central Asia is increasingly viewed as a key part of Washington’s strategy to reduce dependence on Chinese supply chains. However, they point to several obstacles, including high logistics costs, underdeveloped export infrastructure, and what they describe as a high-risk investment environment that limits the commercial viability of many projects. Kazakhstan and Uzbekistan: Pillars of U.S. Engagement Among the countries of the region, Kazakhstan and Uzbekistan offer the greatest potential for rare earth element extraction and present favorable conditions for U.S. cooperation. Kazakhstan is strengthening its partnerships with Western investors in the mining sector, while Uzbekistan has implemented market reforms and opened its economy to foreign capital in recent years. Kazakh President Kassym-Jomart Tokayev, currently visiting the U.S., has reiterated his government’s interest in attracting American investment and technology, including through the C5+1 regional format. After his visit to Washington, he is scheduled to travel to Moscow for a meeting with Russian President Vladimir Putin on November 12, reflecting Kazakhstan’s longstanding policy of balancing relations among major powers. Kyrgyzstan Banks on the Digital Economy Lacking major oil and gas reserves, Kyrgyzstan is pursuing a different path by developing partnerships with the U.S. in financial technology and digital assets. During talks with U.S. President Donald Trump in Washington, Kyrgyz President Sadyr Japarov said the country’s most valuable asset is its educated youth, who are increasingly active in the IT sector. Japarov outlined several initiatives, including the introduction of digital financial instruments such as the national stablecoin KGST. He also noted the importance of the U.S. Genius Act, which regulates stablecoin circulation, calling it one of the most progressive in the world. In response, the U.S. expressed its readiness to expand cooperation in digital transformation and fintech development. Tajikistan Prioritizes Energy and Security Tajik President Emomali Rahmon participated in the C5+1 summit in Washington and held separate talks with President Trump. The discussions focused on energy, investment, and regional security. Rahmon said that peace and stability are essential for sustainable development and reaffirmed Tajikistan’s readiness to expand cooperation with the U.S. in green energy and regional electricity transmission projects. At present, more than 70 U.S.-affiliated companies operate in Tajikistan. American investment in mineral extraction and processing is viewed as a promising area for future collaboration. The two sides also discussed joint efforts to combat transnational threats, including terrorism, extremism, and drug trafficking. Turkmenistan Maintains Its Neutral Stance In contrast to the active diplomatic engagements of its neighbors, Turkmenistan continues to adhere to its traditional policy of neutrality. Ashgabat has so far refrained from joining initiatives that could be perceived as aligning with geopolitical blocs. Nonetheless, the U.S. remains interested in Turkmenistan’s energy potential, particularly regarding prospects for diversifying gas exports to Europe through the...

Qosh Tepa canal

Afghanistan’s Qosh Tepa Canal Raises Water Security Fears

Water has long been one of Central Asia’s most contested resources, shaping agriculture, energy policy, and diplomacy across the region. Recently, Afghanistan’s Qosh Tepa Canal project has emerged as a central point in this debate. Promoted by the Taliban as a vital step toward achieving food security and economic growth, the canal also raises alarm bells among downstream neighbors who heavily depend on the Amu Darya River. Now, according to Islamic Emirate spokesman Zabihullah Mujahid, the second phase of the project is expected to be completed within five months, raising further concerns among downstream countries about its potential impact on regional water security. Progress on the Ground In August, the Afghan authorities stated that 93% of the second phase had been completed. Videos show the canal lined with concrete and stone in some sections, alongside the construction of large and medium-sized bridges to link surrounding settlements. The project spans 128 kilometers from Dawlatabad district in Balkh province to Andkhoy district in Faryab province and involves over 60 contractors, making it one of Afghanistan’s largest infrastructure projects. Origins and International Support The canal’s roots trace back to earlier international efforts. While some sources attribute its conceptual origins to Soviet or British engineers in the 1960s, significant development began in 2018 under President Ashraf Ghani. The project was supported by the U.S. Agency for International Development (USAID) and Indian engineering firms. According to the Scientific-Information Center of the Interstate Commission for Water Coordination (SIC ICWC), a $3.6 million feasibility study was launched in Kabul in December 2018, funded by USAID and conducted by AACS Consulting and BETS Consulting Services Ltd. The study was coordinated with several Afghan ministries, but has not been published. Following the Taliban’s takeover, the Islamic Emirate held an official inauguration ceremony on March 30, 2022. The full canal is designed to stretch 285 kilometers, measuring 100 meters wide and 8.5 meters deep, and is expected to divert an estimated six to ten cubic kilometers of water annually from the Amu Darya. Afghan media have quoted water management expert Najibullah Sadid, who projected the canal could generate between $470 million and $550 million in annual revenue. Regional Concerns and Environmental Risks The project has raised alarm in Uzbekistan, Turkmenistan, and Tajikistan, countries that depend heavily on the Amu Darya for irrigation. Experts at SIC ICWC point out that no environmental impact assessment was conducted for downstream states, nor were they formally notified of the construction, as required by international water conventions. In December 2022, Uzbek President Shavkat Mirziyoyev called for practical dialogue with Afghanistan and the international community to strengthen regional water security. Adroit Associates estimates that the canal could eventually divert up to 13 billion cubic meters annually, nearly one-quarter of the Amu Darya’s average flow. Environmental risks are also mounting. Analysts warn that Uzbekistan, which relies heavily on the river for agriculture, could face soil degradation and declining crop yields. Turkmenistan, where agriculture accounts for 12% of GDP, may also suffer severe disruptions. Some studies suggest Uzbekistan and...