Kazakhstan, Uzbekistan Set to Establish Free Trade Regime

Kazakhstan and Uzbekistan are advancing their plans to establish a free trade regime, aiming to double their mutual trade to ten billion dollars.

This initiative was a central topic during the 21st meeting of the Joint Intergovernmental Commission on Bilateral Cooperation, co-chaired by Kazakh Prime Minister Olzhas Bektenov and his Uzbek counterpart Abdulla Aripov on July 11-12.

The Uzbek government press service emphasized the importance of increasing mutual trade to ten billion dollars in the coming years, especially given the current geopolitical and rapidly changing economic situations.

“To achieve this, it is essential to work more systematically on replacing imports from third countries and transitioning to a fully free trade regime,” the press service stated.

Kazakhstan and Uzbekistan together account for 57 percent of all Central Asian trade. Their trade turnover was $4.5 billion in 2023, exceeding $1.2 billion in the first four months of 2024. Over the past five years, trade turnover rose by 29.5 percent to $4.4 billion. In 2023, Kazakh exports jumped by 56.9 percent to $3.1 billion from $2 billion, while imports fell by 9.1 percent to $1.3 billion.

“Uzbekistan is one of Kazakhstan’s largest trading partners,” said Prime Minister Bektenov. “The heads of our two states have tasked our governments with increasing the mutual trade volume to ten billion dollars in the medium term. We are interested in expanding trade in the agro-industrial complex and the food industry, as well as enhancing industrial cooperation.” 

Economic cooperation between the two nations has expanded in recent years, leading to 69 industrial projects valued at $3.1 billion, which are expected to create nearly 14,700 jobs. So far, 12 joint projects valued at $217 million have been completed, creating around 4,500 jobs. Additionally, three investment projects worth $178 million are underway, including a major electrometallurgical plant in Taraz with a capacity of 500,000 tons of steel products.

Another major initiative is the construction of the Central Asia International Center for Industrial Cooperation on the Kazakh-Uzbek border, covering 100 hectares in the Turkistan Region of Kazakhstan and the Syrdarya Region of Uzbekistan. The center is intended to facilitate the development of trade and economic relations between the countries, intensify business ties between manufacturers and entrepreneurs, and accelerate the growth of trade turnover between Kazakhstan and Uzbekistan. The technical launch of the industrial cooperation center is planned for the fourth quarter of 2026, with the official opening in the first half of 2027.

Both countries are also looking to expand cooperation in mechanical engineering to boost the mutual supply of electrical products and batteries annually. Measures are being taken to enhance transport sector interconnections, develop railway infrastructure, and eliminate bottlenecks to facilitate an increase in cargo turnover.