Eurasian Development Bank - The Times Of Central Asia

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international flights

China–Central Asia Flights Expand as Aviation Booms

Passenger and cargo links between Central Asia and China are expanding, with 117 scheduled weekly flights now connecting Kazakhstan and China, up 52% from a year earlier. Aviation officials from China and the five Central Asian countries are meeting in Tashkent on November 3–5 to discuss opening the market further. Trade between China and Central Asia reached $106.3 billion in 2025, up 12% from the previous year. The expansion of aviation has coincided with rising tourism and the gradual easing of restrictions on airlines across the region. Kazakhstan introduced an "open skies" policy at major airports in 2019, relaxing limits on foreign carriers, while Uzbekistan has also eased access to its market. A Decade of Aviation Growth According to a Eurasian Development Bank (EDB) study published on October 13, Central Asian airlines carried 31.7 million passengers in 2025, almost twice as many as in 2019. Between 2015 and 2025, the number of airline seats available in the region grew by an average of 7.7% annually, nearly three times the global rate. Low-cost airlines accounted for 21% of the region's available seats in 2025, with Kazakhstan's FlyArystan the largest operator in this segment. Air cargo carried by the region's airlines more than quadrupled between 2023 and 2025, reaching 335,700 metric tons. Uzbek operators accounted for approximately 67% of the total. Kazakhstan Leads the Passenger Market Kazakhstan accounted for 48.7% of Central Asia's airline passenger traffic in 2025, the largest share in the region, according to the EDB. By late October 2026, airlines were operating 21 routes between Kazakhstan and China and had carried more than one million passengers between the two countries since the beginning of the year, according to Kazakhstan's Ministry of Transport. In July, the two countries' aviation authorities agreed to increase the permitted number of weekly flights from 124 to 152. The list of approved destinations in China expanded to 11 cities, including Chongqing. The negotiations also addressed the possibility of opening a third air corridor across their shared border to accommodate additional flights. New routes launched this year include FlyArystan's services from Almaty to Xi'an in June and Chongqing in September. Air Astana also began flying between Astana and Guangzhou in June. On October 30, Air Astana and China Southern Airlines signed a strategic partnership agreement intended to make connecting flights between their networks easier. It builds on their existing codeshare arrangements, which allow the airlines to sell tickets on one another's flights. Uzbekistan Expands Passenger and Cargo Flights Uzbekistan has Central Asia's second-largest passenger aviation market. Its airports handled 12.66 million passengers in the first nine months of 2026, up 13% year over year, according to Uzbekistan Airports. Uzbekistan's Ministry of Transport reported in August 2025 that 61 passenger flights and more than 120 cargo and transit flights were operating weekly between Uzbekistan and China. The expansion followed agreements that increased the number of airlines permitted to operate between the two countries and gave carriers greater rights to transport freight through third countries. China Eastern Airlines...

Energy Security

Central Asia Electricity Demand Expected to Rise 27% by 2030, EDB Says

Electricity demand across Central Asia is expected to increase by 27% by 2030, putting additional pressure on the region’s power grids, according to the Eurasian Development Bank. Arman Akhunbayev, head of the bank’s Center for Sectoral Analysis, announced the projection during an October 29 presentation of its report, Energy Without Borders: The Architecture of Power Connectivity in Central Asia. “To prevent energy shortages from becoming an obstacle to economic growth, generation capacity and power grids must be prepared now for new factories and expanding cities,” Akhunbayev said. The bank stressed that building additional power plants alone would not be enough. With countries in the region planning to add more than 35 gigawatts of new solar and wind capacity by 2035, it called for grid upgrades and investment in energy storage and backup generating capacity. The report noted that during peak demand on December 10, 2024, around 6.6 gigawatts of generating capacity in Central Asia’s interconnected power system was unavailable or restricted because of technical and resource constraints. In a separate report published in March, the bank had projected that electricity consumption could reach 370 billion kilowatt-hours annually by 2030, up nearly 40% from around 270 billion in 2024. The October presentation does not specify the baseline for its 27% forecast.

Private Equity

Oman Investment Authority Plans $500 Million Fund for Central Asia and Caucasus

The Oman Investment Authority (OIA) and five other investment institutions have agreed to establish a private equity fund for Central Asia and the Caucasus that aims to raise $500 million. A letter of intent was signed in Beijing on October 20, with a formal agreement expected in early November 2026. The other participating institutions are China Investment Corporation and Shenwan Hongyuan Securities, both based in China; Uzbekistan’s Fund for Reconstruction and Development; Turkey’s Armed Forces Pension Fund, known as OYAK; and the Eurasian Development Bank (EDB). The initiative is led by OIA. The fund will be known as the Central Asia and Caucasus Private Equity Fund. An Omani company is expected to manage it. OIA has identified Azerbaijan, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan as prospective investment markets. Priority sectors will include logistics, renewable energy, mining, agriculture, food production, and healthcare. The fund plans to acquire ownership stakes in regional companies, providing them with capital to expand their operations. The organizers will seek investment from sovereign wealth funds and other institutional investors, although they have not disclosed how much of the $500 million target has been committed. Daniyar Imangaliyev, deputy chairman of the EDB’s Management Board, said the fund would help regional companies expand into new markets while attracting additional international capital to the bank’s member states. The initiative builds on the EDB’s cooperation with Oman. On October 6, the bank and the sultanate’s Ministry of Finance signed an agreement governing the EDB’s operations in the country. This marked a step toward Oman’s potential accession as a shareholder of the bank, which would make it the first Gulf state to join.

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

Central Asia Growth Forecasts Remain Strong in Latest ADB Outlook

Four of Central Asia’s five economies are expected to grow faster in 2026 than developing Asia and the Pacific as a whole, according to the Asian Development Bank’s September Asian Development Outlook. ADB forecasts growth of 5% across developing Asia and the Pacific this year, compared with 8.9% in Kyrgyzstan, 7% in Uzbekistan and Tajikistan, and 6.3% in Turkmenistan. Kazakhstan is the exception, with growth forecast at 4.8%. Kyrgyzstan is growing faster than its neighbors but is also facing the highest inflation among the five countries. ADB forecasts inflation at 11.2% this year and 8.5% next year. Growth continues to be supported by domestic demand and sustained investment, while ADB says import dependence and electricity-generation shortfalls are contributing to inflationary pressures. For Uzbekistan, ADB forecasts gross domestic product growth of 7% and inflation of 6.7% in 2026. In 2027, the figures are expected to be 6.8% and 5%, respectively. Stronger-than-expected economic activity prompted ADB to upgrade Uzbekistan’s 2026 growth forecast in its September outlook. Tajikistan is also forecast to grow by 7% in 2026, with inflation at 4.5%. Growth is expected to slow to 6.8% in 2027, while inflation is forecast to edge up to 4.7%. ADB lowered its 2026 growth projection in September, saying the escalation of Russia’s war in Ukraine had disrupted fuel imports and constrained near-term economic activity. Kazakhstan, the region’s largest economy, is growing more slowly than its neighbors. ADB expects growth of 4.8% this year and 4.5% next year, with inflation forecast at 10.4% and 9.5%, respectively. The bank left its growth and inflation forecasts unchanged from its previous outlook, with inflation expected to ease only gradually. For Turkmenistan, ADB forecasts growth of 6.3% in 2026 and 6.2% in 2027, with inflation at 6% in both years. The country’s economic indicators remain more difficult to compare with those of its neighbors because of limited access to reliable and detailed economic data. Its economy also remains heavily dependent on natural gas exports, with China its main gas market. Central Asia’s growth figures look strong against the Asian backdrop, but ADB is warning of energy and climate risks across developing Asia and the Pacific. Prolonged disruption to global energy markets could keep oil and gas prices elevated and volatile. For energy importers, that means higher fuel costs and additional inflationary pressure, while hydrocarbon exporters may benefit from higher prices but remain vulnerable to disruption in production and export routes. Another risk is a very strong El Niño, which ADB expects to persist through the first quarter of 2027. Extreme weather could reduce agricultural production and push up food prices, while a decline in hydropower generation could increase demand for other energy sources. For Kyrgyzstan and Tajikistan, where hydropower supplies most electricity, weather and water availability add another layer of vulnerability. The differences between forecasts for the region remain substantial. In August, The Times of Central Asia compared projections from international financial institutions. The Eurasian Development Bank (EDB) forecast 2026 growth of 10.2% for Kyrgyzstan, 8.3% for Tajikistan,...

Intra-regional trade

Central Asia Trade Rises 25% as Kazakhstan and Uzbekistan Dominate

Central Asian countries are trading more actively with one another, although the regional market continues to be dominated by its two largest economies, Kazakhstan and Uzbekistan. In January-July 2026, the five countries exported $8.1 billion worth of goods to their neighbors, up 25.4% from a year earlier. Kazakhstan and Uzbekistan accounted for more than 80% of those shipments. Smaller bilateral routes have expanded as well. Uzbekistan’s trade with Kyrgyzstan increased by more than half, while trade with Tajikistan rose by 45%. Trade between Kyrgyzstan and Tajikistan rose by a factor of 3.3 after several years of border closure and sharply reduced economic ties. In absolute terms, trade between Kazakhstan and Uzbekistan remains the region’s largest bilateral flow. The figures were published by Uzbekistan’s Center for Economic Research and Reforms (CERR). Kazakhstan remains the region’s largest exporter. Over the seven-month period, it shipped $4.5 billion worth of goods to its neighbors, accounting for 55.9% of total intra-regional exports. Uzbekistan exported $2 billion, representing another 24.7%. Kazakhstan’s Central Asian neighbors still account for a relatively small share of the country’s overall foreign trade. In January-July, its total foreign trade turnover amounted to $87.75 billion. Central Asia accounted for around 6.7% of Kazakhstan’s total trade and 8.9% of its exports. By contrast, Kyrgyzstan’s trade volumes are much smaller, but neighboring markets are considerably more important to the country’s exporters, absorbing almost one-third of its exports. During the same period, Kyrgyzstan exported $523 million worth of goods to its neighbors and imported nearly $1.5 billion. Tajikistan buys considerably more from its neighbors than it sells to them. Its imports from Central Asia increased by 35% to $1.2 billion, while exports rose 6.2% to $209 million. Kazakhstan and Uzbekistan account for around 94% of Tajikistan’s trade with the region. Figures reported by Turkmenistan’s trading partners show that the country exported $844 million worth of goods to neighboring countries. Uzbekistan and Kazakhstan remain its main regional markets. The Eurasian Development Bank estimated that trade among Central Asian countries reached $12.3 billion in 2025, nearly double the 2020 level. Kazakhstan accounted for 54% of regional exports, as The Times of Central Asia previously reported. New transport and energy links are developing alongside intra-regional trade. In February, the World Bank approved an $846 million guarantee to mobilize $1.41 billion in commercial financing for a railway project in Kazakhstan. The project includes construction of the 201-mile Mointy-Kyzylzhar railway line on Kazakhstan’s section of the Trans-Caspian International Transport Route, or Middle Corridor. The new line is expected to shorten the route by 149 kilometers and relieve congestion on heavily used sections of the corridor. Central Asian countries are seeking closer integration of their power systems. In January, the World Bank approved the 10-year Regional Electricity Market Interconnectivity and Trade Program, with indicative financing of more than $1 billion, to establish Central Asia’s first regional electricity market. Cross-border electricity trade currently amounts to only around 3% of the region’s total electricity demand. In an earlier CERR analysis, researcher Ruslan Abaturov argued...