Eurasian Development Bank (EDB) - The Times Of Central Asia

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Bank Membership

Oman Set to Join Eurasian Development Bank as First Gulf Shareholder

Oman is set to become the eighth shareholder of the Eurasian Development Bank (EDB) and the first Gulf state to join the institution. An agreement was signed in Astana on October 6 during Sultan Haitham bin Tarik Al Said’s state visit to Kazakhstan. The EDB’s current shareholders are Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan, and Uzbekistan. Oman would become the first member from outside the former Soviet Union. The agreement, signed by Omani Finance Minister Sultan bin Salim Al Habsi and EDB Chairman Nikolai Podguzov, sets out the terms of the EDB’s operations in Oman. “This agreement reflects our shared intention to build a bridge between Central Asia and the Gulf region,” Podguzov said. Russia remains the bank’s largest shareholder, although its stake was reduced from about 66% to 44.8% in 2023. By the end of June 2026, the EDB’s cumulative portfolio comprised 348 projects with total investment of $22.1 billion. The bank finances projects including transport infrastructure, energy, and digital systems. On October 6, Kazakhstan and Oman signed an agreement on the mutual protection of investments, while Samruk-Kazyna and the Oman Investment Authority agreed to establish a joint investment vehicle to finance projects. As a landlocked country, Kazakhstan is seeking additional routes to the Indian Ocean, and the two sides discussed using Omani ports to transport its goods. Oman has proposed developing a trade corridor through its seaports. The talks in Astana also covered direct air links and other logistics projects. Kazakhstan is seeking to increase exports of grain, meat, and other agricultural products to Oman. In 2025, honey from Kazakhstan was exported to the sultanate for the first time. On October 5, the two countries’ chambers of commerce signed a memorandum aimed at expanding business ties, including in agriculture and logistics. Founded by Kazakhstan and Russia in 2006, the EDB has gradually expanded its membership, most recently with Uzbekistan in 2025.

Economic Growth

Kyrgyzstan Records Double-Digit Growth as Inflation Stays Above 11%

Kyrgyzstan’s economy grew by 11.1% in the first seven months of 2026, but households also faced double-digit inflation. Annual price growth reached 11.5% in July. The latest poverty figures show that 24% of the population remained below the national poverty line in 2025. According to the latest macroeconomic review by the Eurasian Development Bank (EDB), the expansion has been driven primarily by a surge in investment and strong consumer demand. Kyrgyzstan’s growth rate exceeded those reported by several Central Asian neighbors, although the figures cover different periods. Kazakhstan’s economy expanded by 4.1% in January–July. Uzbekistan and Tajikistan grew by 8.5% and 8.2%, respectively, in the first half of the year. The EDB forecasts growth of 10.2% for Kyrgyzstan over 2026 as a whole. Average real wages, adjusted for inflation, rose by 15.3% in January–June. This indicates stronger purchasing power among wage earners on average, but does not establish an improvement across all households. Investment increased by 58.8% over the first seven months. Budget financing for investment increased by about 70%, while bank financing rose to 4.3 times its previous level. Fixed-capital investment financed by foreign direct investment rose to 15.3 times its previous level. Budget revenues also increased by 48.8% in the first half of the year, while the republican budget recorded a surplus equivalent to 6.1% of GDP. Price Growth Remains in Double Digits Annual inflation reached 11.5% in July, up from 11% a month earlier. The pressure is visible in everyday purchases. In July alone, average prices for horsemeat rose by 5.4%, lamb by 4%, and beef by 3.9%, although potatoes became cheaper. Housing and utility costs were also rising rapidly, with annual inflation in that category reaching 11.2%. Fuel prices are another source of pressure. The National Bank says higher global oil prices, amid the conflict in the Middle East and concerns over petroleum supplies, have raised the cost of imported fuel. Those increases then feed into transport and production costs across the economy. By August 24, the National Bank put annual inflation at 11.7%, with prices up 7.3% since the start of the year. On the same day, it kept its policy rate at 12%. The central bank cited persistent inflationary pressure, including higher import costs and production expenses. Its inflation target range is 5%–7%. The EDB expects inflation to end 2026 at about 11.5%, still well above that range. IMF Proposes Changes to Public-Sector Pay The International Monetary Fund has also examined public-sector compensation. In a technical assistance report published on September 2, it notes pay raises of 50% for doctors and 25% for nurses in 2024. The report also records a 63% increase in remuneration for the social sector in 2026. According to the IMF, large, infrequent pay increases can add to inflationary pressures and make government spending more difficult to manage. The IMF recommends moving away from large, episodic increases toward more regular salary adjustments that account for inflation, available fiscal space, and labor market conditions. This would make wage growth and government...

Growth Forecasts

Why Central Asia Growth Forecasts Differ So Sharply

How fast can Central Asia continue to grow? The Eurasian Development Bank (EDB) and the International Monetary Fund (IMF) give markedly different answers. The contrast is sharpest in Kyrgyzstan, where the EDB expects another year of double-digit growth, while the IMF sees a much more pronounced slowdown. Both institutions are looking at the same countries and have access to broadly the same set of macroeconomic data. Their forecasts, however, reflect different assessments of how much of Central Asia’s recent momentum can be sustained. The EDB expects strong investment to keep growth high, while the IMF is more cautious about how long the recent pace of expansion can continue. The EDB is itself a regional development institution. It was established by Russia and Kazakhstan in 2006, with Armenia, Belarus, Kyrgyzstan, and Tajikistan later becoming shareholders. Uzbekistan joined the bank in 2025. The EDB is headquartered in Almaty. The comparison covers the four Central Asian states that are EDB members; Turkmenistan is not included. Its latest forecast for Central Asia is optimistic. In 2026, the EDB expects growth of 10.2% in Kyrgyzstan, 8.3% in Tajikistan, 7.9% in Uzbekistan, and 5.5% in Kazakhstan. The region’s economy as a whole is expected to grow by more than 6.5%, with its combined GDP exceeding $600 billion for the first time. The IMF gives lower figures. Its latest available country projections put 2026 growth at 4.6% for Kazakhstan, 6.8% for Uzbekistan, 6.1% for Kyrgyzstan, and 6.0% for Tajikistan. These projections were published at different times rather than as a single set of four country forecasts. The largest gap is in Kyrgyzstan, where the forecasts differ by 4.1 percentage points, but there are nevertheless modest percentage point gaps between the forecasts for Tajikistan (2.3), Uzbekistan (1.1), and Kazakhstan (0.9). These differences are large enough to raise the question: why the difference in expectations? Part of the answer lies in how the institutions assess the effect of a more uncertain global economy. The IMF expects the world economy to grow by 3% in 2026 and 3.4% in 2027. Its July update said the conflict in the Middle East was weighing particularly heavily on energy importers and warned that renewed conflict or financial-market disruption could weaken the outlook. For the four countries, this means different things. Kazakhstan exports oil and benefits from high prices, although it also depends on the condition of export routes and external demand. Kyrgyzstan and Tajikistan import a significant share of their fuel, while their economies are closely linked to migrant remittances. Uzbekistan has a larger domestic market and its own resource base. Kazakhstan illustrates the logic of the IMF forecast particularly well. Its GDP grew by 6.5% in 2025, one of its strongest performances in recent years. The Fund does not expect that surge to be repeated. Oil production is expected to stabilize after last year’s increase, with growth slowing to 4.6% in 2026, according to the IMF forecast. This does not mean that the Fund attributes everything to oil. Domestic demand remains strong,...

Transport Corridors

EDB Says Uzbekistan Is Becoming a Eurasian Transport Hub

Uzbekistan is becoming a crossroads of Eurasian transport corridors, Alexei Skatin, deputy chairman of the Management Board of the Eurasian Development Bank (EDB), said at the Tashkent International Investment Forum on June 18. Skatin made the remarks during a panel session titled Transforming the Railway Sector and Developing New Logistics Corridors in Central Asia: Investment Opportunities and Regional Connectivity. According to Skatin, three key railway corridors will pass through the country: the China-Kyrgyzstan-Uzbekistan railway, which is already under construction; the Trans-Afghan railway; and the planned Tashkent-Samarkand high-speed rail line. The China-Kyrgyzstan-Uzbekistan corridor is expected to provide a direct container link between Uzbekistan and China, with further connections to Turkmenistan, the South Caucasus, Turkey, and the Gulf states. According to EDB estimates, the corridor could increase container traffic through Uzbekistan fivefold, from 100,000 to 500,000 TEU. The Trans-Afghan railway corridor is expected to provide direct access to Pakistani ports, reducing the distance for Uzbek cargo shipments by at least 1,000 kilometers. The Tashkent-Samarkand high-speed rail line, described by the EDB as the first dedicated high-speed rail project in Central Asia, is expected to free up the existing line for freight and container traffic. The completion of the Darbaza-Maktaaral railway in Kazakhstan and the creation of a new border crossing are expected to integrate Uzbekistan into the Trans-Caspian International Transport Route, also known as the Middle Corridor. “Uzbekistan is transforming from a landlocked country into a crossroads of East-West and North-South routes. It is the combination of these routes that makes it a point of intersection, not just a transit point,” Skatin said. He added that transport corridor development is impossible without the simultaneous expansion of warehousing infrastructure, dry ports, and container terminals. According to EDB estimates, demand for warehousing in Uzbekistan could grow more than sevenfold, while current availability remains low. “A transport corridor only works when goods move along it. That is why we consider warehouses, dry ports, and terminals together with transport routes, not separately. Warehouses are not an add-on to corridors; they are a condition for corridors to generate revenue,” Skatin said. The EDB says it is the leading multilateral development bank in non-sovereign financing in Central Asia. The bank sees its role as unlocking the investment potential of transport corridors and related infrastructure, including warehouses, dry ports, and terminals in Uzbekistan. According to EDB estimates, freight traffic in Central Asia will grow by 50% by 2030, reaching 95 million metric tons compared with 2024, while container traffic is expected to grow by 67% to 1.7 million TEU.

Eurasian Development Bank (EDB)

EDB to Provide Tajikistan With $18.5 Million for Road Construction in Gorno-Badakhshan

The Eurasian Development Bank (EDB) will finance the construction of a section of the Labidjar-Kalaikhumb highway in Tajikistan in a project aimed at improving transport connections with the country’s remote Gorno-Badakhshan Autonomous Region (GBAO) and increasing access to mountainous areas. The financing agreement was signed by the EDB’s country director for Tajikistan, Vladimir Yakunin, and Tajik Finance Minister Fayziddin Kakhhorzoda. Under the agreement, the bank will provide Tajikistan with concessional financing totaling $18.5 million. Of that amount, $17 million will be issued as a loan, while an additional $1.5 million will be allocated as a targeted grant. The funds will be used for the construction and reconstruction of the first section of the Labidjar-Kalaikhumb road. The project includes the construction of ten kilometers of roadway and three bridges. Project developers say the new infrastructure will improve cargo transport safety, enhance access to remote mountain regions, and create additional opportunities for business development and trade. The project is also expected to strengthen transport links between Tajikistan’s centrally administered districts and the Gorno-Badakhshan Autonomous Region. “The project will become part of a broader effort to modernize Tajikistan’s transport infrastructure and will contribute to the country’s socio-economic development, the expansion of interregional ties, and increased population mobility,” Yakunin said. He added that support for infrastructure projects remains one of the bank’s key strategic priorities. The Eurasian Development Bank has operated across the Eurasian region for nearly two decades. The institution finances projects in transport, digital infrastructure, agriculture, industry, and green energy. According to the bank, by the end of 2025, its portfolio included 326 projects with a combined investment volume of approximately $19.6 billion. A significant share of those projects is linked to the development of transport corridors and deeper economic integration among participating countries. The EDB also states that its activities are guided by the United Nations Sustainable Development Goals and ESG principles.

Trade

EDB: Central Asian Trade Has Doubled in Five Years

Mutual trade between Central Asian countries reached $12.3 billion in 2025, nearly doubling compared to 2020, according to analysts at the Eurasian Development Bank (EDB). The figure underlines how Central Asia is increasingly emerging as a more interconnected regional market after years of relatively limited internal trade links following the collapse of the Soviet Union. Kazakhstan remains the largest participant in regional trade, accounting for 54% of all intraregional exports, valued at $6.6 billion. The country's key export commodities to the region include grain products (18%), ferrous metals (13%), crude oil and petroleum products (8%), sunflower oil (7%), and beverages (3%). The primary destination for these exports is Uzbekistan, while Kyrgyzstan recorded the fastest growth in imports from Kazakhstan, with volumes nearly tripling to $1.7 billion. Uzbekistan ranks second, accounting for 26% of regional exports, worth $3.2 billion. The largest increase in Uzbek exports was recorded in trade with Kazakhstan, where shipments grew 2.1 times. Uzbekistan’s main export products include motor vehicles and auto parts (14%), fruit and vegetables (11%), plastic products (5%), fertilizers (4%), and clothing (3%). Between them, the two largest Central Asian economies represent nearly $10 billion of exports to their neighbours, representing almost 80% of regional trade. Turkmenistan's share of exports – primarily natural gas – rose to 11%, while Kyrgyzstan's $0.9 billion of exports (half of which was unprocessed precious metals and coal) represented 7%. Tajikistan was the smallest contributor, accounting for just 3% of intraregional exports – principally zinc, lead and copper. According to EDB analysts, the rapid expansion of trade has been driven by strengthening bilateral economic cooperation among Central Asian states and efforts to simplify trade procedures. The bank said the pace of growth demonstrates that Central Asia is gradually emerging as an increasingly integrated regional market with strengthening internal economic ties. That said, analysts stressed that the current level of trade still represents only a fraction of the region’s broader economic potential. Further reductions in trade barriers, improved transport connectivity, and deeper industrial cooperation could significantly accelerate intraregional trade turnover, the report said. EDB analysts estimate that trade between Central Asian countries could increase by an additional $4 billion by 2029.