Foreign Investment - The Times Of Central Asia

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Kyrgyz-German Business Forum

On June 20, First Deputy Chairman of the Cabinet of Ministers of the Kyrgyz Republic Adylbek Kasymaliev presided over a Kyrgyz-German business forum hosted by Frankfurt am Main. Kasymaliev noted that during 32 years of bilateral cooperation, his country’s German partners have implemented several socially significant projects in Kyrgyzstan, including the establishment of an Anti-TB Clinic and a Perinatal Center in Bishkek. Referencing the facts from 2019-2023, bilateral trade turnover had increased 5.5-fold and over 180 joint Kyrgyz-German enterprises currently operate in Kyrgyzstan, first deputy prime minister emphasized that “the potential of cooperation between the two countries has not been fully realized.” Calling on German businesses to further their investment in projects in Kyrgyzstan, Kasymaliev stated, “The undertaken fiscal reforms have made it possible for Kyrgyzstan to instigate the most liberal tax regime in Central Asia”, to the great advantage of German companies and entrepreneurs investing in joint ventures.

Renewable energy Solar Energy Foreign Investment

Malaysian and Chinese Companies to Aid Development of Green Energy in Uzbekistan

A cooperation agreement has been signed between Uzbekistan’s Yashil Energy, Malaysia’s Fabulous Sunview, and China’s Huawei Tech. Investment Tashkent. According to a report by the Uzbek Ministry of Energy, the agreement provides for the joint development of green energy in Uzbekistan and construction of small solar photovoltaic stations with a capacity of 50 MW on the roofs of social facilities, government agencies, and other organizations. The document was signed during the 17th International Conference and Exhibition on “Electricity Production Using Solar Photovoltaic Stations and Smart Energy” held in Shanghai from 13-15 June.

Telecommunication Internet Foreign Investment Digital Silk road

Kazakhstan to Establish 5G Mobile Coverage by 2026

On June 18, Kazakhstan’s Minister of Digital Development, Innovation and Aerospace Industry Zhaslan Madiev updated the government on progress on improvements to the country’s Internet and mobile communication. International data indicates that the share of the population using the Internet in Kazakhstan is now on par with that of developed countries. Traffic growth has increased by 61.5% since 2020, and the number of users, by 12.9%. According to Speedtest Ookla, in April 2024, Kazakhstan ranked 66th with an average Internet speed of 43.6 Mbps, higher than Russia, Kyrgyzstan, and Uzbekistan. Wired Internet is currently available in 2,606 of Kazakhstan’s 6,290 villages, with plans in place to connect optical communication lines through the PPP mechanism to 3,010 villages. Mobile Internet is now accessible in 4,866 villages. As part of tax incentives in 2023, 1,161 villages were connected to 4G technology. Work to connect the remaining 1,424 villages is ongoing. Regarding the further development of 5G technology, operators Kcell and Tele2 will continue work to expand 5G coverage in the cities of Astana, Almaty, Shymkent, as well as regional centres. To date, 1,144 base stations have been installed in 20 cities. “In accordance with instructions issued by the Head of State, the introduction of 5G mobile communications should be completed before the end of 2025,” reported the minister. Madiev then outlined the three steps required to develop the Digital Silk Road and turn Kazakhstan into a regional digital hub. The first is to lay a 370-kilometer fiber-optic line along the bed of the Caspian Sea with investment by telecom operators in Kazakhstan and Azerbaijan amounting to more than 23 billion tenge. A joint venture has been created between Kazakhtelecom JSC and Azertelecom LLC, and a tender to select a contractor for the design and installation of an underwater fibre-optic line is underway. The second is the construction of the national West-East Internet hyper highway, which will increase Internet transit traffic across Kazakhstan. The final step is the construction of a data processing centre, no lower than Tier-III level, for storing transit and international traffic.

Agriculture Car Industry Foreign Investment Green Energy Critical minerals Strategic Partnership Strategic dialogue Innovative technology Foreign cooperation

Uzbekistan and Korea Forge New, High-Tech Agenda for Strategic Partnership

On 14 June, South Korean President Yoon Suk Yeol held talks with Uzbekistan President Shavkat Mirziyoyev. During their meeting in Tashkent, it was noted that the Republic of Korea is among Uzbekistan’s leading trade and investment partners. Last year, bilateral trade turnover reached $2.5 billion, and Korean investments in Uzbekistan now exceed $7.5 billion. Negotiations focused on the formation of a new, high-tech agenda for Uzbek-Korean strategic partnership over the next three years. As a result, the two leaders tasked their governments to prepare a Strategic Program for the creation of a regional high-tech hub in Uzbekistan, with priority given to the following “anchor” areas of the Strategy: Partnership on critical mineral resources with deep processing and creation of a complete added value chain. Strategic cooperation in the field of semiconductors, in which the Republic of Korea is recognized as a global leader, and the implementation of plans to create in Uzbekistan’s first fully-fledged research and production cluster of semiconductor products. Full-scale partnership in the chemical industry, including new projects to produce green hydrogen and ammonia, as well as finished rubber products. Deepening cooperation in mechanical engineering. This spring, an assembly line for KIA cars was launched in Uzbekistan’s Jizzakh region, to be followed next year, by a plant with the capacity to manufacture over 60 thousand vehicles per year. Transfer of technologies to develop “smart” agriculture, including via the digitalization of the agricultural sector, the introduction of “smart” and “green” technologies. Agreements have already been reached on the creation of modern greenhouses and garden complexes in Uzbekistan’s regions based on renewable energy sources. Infrastructure modernization and a program for urban development, based on the high interest of Korean banks and companies in the modernization of transport infrastructure, and the design and construction of residential and commercial real estate in Uzbekistan on the principles of public-private partnership. With regard to developing potential projects in green energy and increase energy efficiency, strategic dialogue is to be resumed between energy ministers and a meeting organized in Uzbekistan in the near future.

Agriculture business and economy Foreign Investment Employment Industry

PepsiCo to Build Snack Production Plant in Kazakhstan

PepsiCo has announced plans to build a full-scale new plant to produce salty snacks, including Lays crisps, in Kazakhstan’s Almaty region. Implementation of the project was discussed at a meeting between Kazakhstan Prime Minister Olzhas Bektenov and David Manzini, President of PepsiCo in Central Asia, Russia, Belarus, and Caucasus. According to the Kazakh prime minister’s press service, the project has already received $160 million in foreign investment. The plant, anticipated as the largest of its kind in Central Asia, is scheduled to open in 2026. Its original capacity of up to 16,000 tons of finished products per year, will increase to 21,000 tons from 2027, for distribution to both the Central Asian market and abroad. Up to a thousand people will be employed during the plant’s construction, with 350 skilled jobs created when it opens. David Manzini stated PepsiCo’s intention to use locally sourced raw materials. The conclusion of contracts with Kazakh farmers on the delivery of test batches of potatoes is ongoing but all going to plan, the company will purchase up to 50-66 thousand tons of potatoes in 2026-2030, and increase the volume in later years. Prime Minister Bektenov emphasized the importance of the project for the development of agriculture, increasing Kazakh farmers’ income and strengthening the economy. He mentioned that besides its positive impact the food industry and agribusiness, the plant will have a multiplier effect on related industries including transport, logistics, packaging, and processing of agricultural products.

business and economy International Cooperation Green Energy Foreign Investment Tourism

Kyrgyzstan Seeks Investment in Energy

On June 10, The Kyrgyz Republic International Energy Investment Forum, organized by the Cabinet of Ministers of the Kyrgyz Republic with support from the World Bank Group and the Government of Austria, opened in Vienna. In his address to representatives of international financial organizations, delegations from Central Asian, European, and Middle East countries, and private investors, Chairman of the Cabinet of Ministers of the Kyrgyz Republic Akylbek Japarov emphasized the importance of discussions on the construction of Kambarata HPP-1 not only for Kyrgyzstan but also for the entire Central Asian region. Japarov then presented a paper on “Economic prospects and investment climate in the Kyrgyz Republic,” in which he stated, “In recent years, the economic growth of Kyrgyzstan has broken all records and demonstrated exceptionally sustainable development. The average GDP growth rate was 7%. And in the first quarter of 2024, the rate of economic growth accelerated to 8.8%.” Referencing the country’s “period of revival” in its energy sector, he continued, “Tariffs are being reviewed and better conditions provided in the form of benefits and preferences for investors. The implementation of more than 50 renewable energy projects has begun throughout the country. The state, on its own, has built and recently launched the Bala-Saruu hydroelectric power plant, which will provide electricity to the [country’s north-western] Talas region.” The head of the Cabinet of Ministers called on all international organizations to collaborate in implementing projects in the Kyrgyz energy sector especially the large-scale construction of Kambarata HPP-1 and stressed, “I am deeply convinced that through joint efforts the largest hydroelectric power plant in the region will be built and new horizons for green energy will open in the Central Asian region.” Japarov also touched upon Kyrgyzstan's tourist potential and with regard to winter sports, announced: “We are starting the construction of a Kyrgyz Courchevel. The French company S3V, one of the first operators of the world- famous resort of Courchevel, is implementing the Three Peaks ski cluster in Kyrgyzstan with plans for around 200 km of ski slopes. The resort will operate all year round and able to receive up to 850 thousand tourists annually, will become the largest in Central Asia. In addition, we are launching the construction of a resort near Bishkek with a 20-kilometer funicular, which will operate both winter and summer. In winter, it will provide a unique opportunity to ski within a 20-minute drive from the capital, Bishkek. All technical structures will be built by the Austrian company Doppel Maier.”