Kazak / Uzbek Trade Expands With Opening Of New Border Trade Center

Kazakhstan and Uzbekistan have stated they are to jointly develop a border trading centre, aimed at easing immigration, customs and warehousing volumes at the border crossing between Shymkent on the Kazak side and Tashkent on the Uzbek side. These are the regions most populous countries, however poor relations until recently have hindered trade for decades. Road and rail links between the two cities, which are some 119 km apart are being upgraded.

Shymkent is the third most populous city in Kazakhstan after Almaty and Nur-Sultan with an estimated population of just over a million. It is also a major railroad junction on the Turkestan-Siberia railway, which essentially connects Central Asia to Siberia, on a route running north-east from near Tashkent through to Novosibirsk in Russia, where it connects with the Trans-Siberian railway. It also connects east to China at Aqtoghay, where the line heads east to Urumqi.

The Turkestan-Siberia Railway

Tashkent is the capital of Uzbekistan, and has a population of about 2.5 million, and a major Central Asian trading city in its own right. The move to establish a cross-border trading center can be expected to produce some immediate and high increases in trade volumes between the two countries. Bilateral trade rose 50% in 2018 to reach just under US$ 3 billion dollars, as trade barriers came down and diplomatic friendships blossomed. Uzbekistan has significantly opened up its economy to foreign investment over the past two years, has relaxed visa restrictions on visitors and has become one of the most rejuvenated and dynamic nations along the entire Central Asian Silk Road routes.

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The two countries are also discussing the boosting of investment cooperation, implementing joint investment projects to gain access to third country markets and taking additional steps to facilitate cooperation in construction, engineering, transport, logistics, tourism, aerospace, and space programs. Kazakhstan hosts the largest space rocket launch complex in Central Asia and is often used for this purpose by Russia.

“There are great opportunities for traders in the Shymkent-Tashkent corridor and this is yet another example of how the Belt & Road Initiative is encouraging previously distant neighbors to engage in infrastructure development and commerce.” says Chris Devonshire-Ellis of Dezan Shira & Associates. “These are exciting times to reach out into Central Asia and the rewards are there for foreign investors in many business sectors prepared to take these steps.”

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