Compounding of advantages and formation of a new mode of economic development

Economic growth and raising the standard of living for residents of the region have been recognized as the two main imperatives for cooperation among the Central Asian republics.

According to the president of Uzbekistan, "trade and economic cooperation is the main driver of regional partnership and integration," the president of Tajikistan has called for a "strategic breakthrough in the economic direction," involving the full potential of the region's states, and the president of Kazakhstan has proposed transforming Central Asia into a "space of new economic opportunities."

The leader of Turkmenistan Serdar Berdimuhamedov and Preisdent of Kyrgyzstan Sadyr Zhaparov also stressed the importance of expanding trade and economic links, boosting bilateral trade turnover, and harnessing huge untapped potential.

Along with the promoting of intraregional trade, the presidents of Central Asian countries gave special attention to the expansion of regional industrial cooperation.

The President of Uzbekistan, in particular, proposed developing and adopting a Strategy for the Development of Industrial Cooperation, while the President of Kazakhstan initiated an Action Plan for the Development of Industrial Cooperation, and President Emomali Rahmon put forward developing separate programs of cooperation in the fields of agriculture, industry, and active introduction of new technologies.

The energy sector was another area where similar approaches were proposed. Thus, the President of Uzbekistan emphasized the need of guaranteeing energy security, which might pose a barrier to Central Asian nations' long-term sustainable growth.

In this respect, he underlined the need of collaboration in the development of energy infrastructure, energy source diversification, attracting investments and technology in the field of alternative energy, and the generation of "green" hydrogen.

Tajikistan and Kyrgyzstan have stated their willingness to actively collaborate with Central Asian nations in the creation of "green energy" based on their hydropower resources.

In exchange, the leader of Turkmenistan indicated his country's determination to assist in meeting regional demand for energy resources, as well as to deliver natural gas and electricity to Central Asian countries and through their territory to overseas markets on mutually advantageous conditions.

President Serdar Berdimuhammedov suggested the creation of a new type of five-sided contact - the Energy Dialogue of Central Asian Countries - to make cooperation in this area more systematic and effective.

Traditionally, the leaders of Central Asian republics have focused their attention on expanding our countries transport and logistics capabilities and diversifying transportation corridors. At the same time, participants in the meeting approved the Five-Party Agreement on Strengthening Interconnectivity of Land Transport in Central Asia.

However, the heads of state did not limit themselves and proposed put forward a number of concrete initiatives. Thus, the President of Uzbekistan proposed developing an Agreement on Transport and Transit in Central Asia, forming specific mechanisms to promote efficient transport corridors to access the markets of China, South Asia, and the Middle East, the European Union with the application of business-friendly tariffs.

He also suggested preparing a Program of measures to liberalize the market of transport services, optimizing permitting procedures, and considering the creation of new integrated digital Platform of international transport.

In line with Uzbekistan's idea, Turkmen President Serdar Berdimuhamedov proposed considering the possibilities of establishing a Central Asian transport and logistics platform.

Without a doubt, all of these initiatives are crucially important for the states long-term development and attest to a shared desire to create a new way of economic development in the region based on the competitive advantages and complementarity of Central Asian economies, to form a capacious market in the region and integrate it into global value chains, and to transform Central Asia into an important link of interregional connectivity.

In this context, it seems to be in demand the President of Uzbekistan's idea to form a Central Asian Economic Council, which might become an efficient instrument for assuring collaboration and coordinating efforts to promote economic initiatives that fulfill common interests.

Akramjon Nematov,

first deputy director of the Institute for Strategic and Regional Studies under the President of the Republic of Uzbekistan

Central Asia is a consolidated actor, devoted to collaborate

The Consultative Meeting confirmed the desire of the leaders of the Central Asian states to continue bolstering political consolidation and shared solidarity, to take on the duty of addressing issues on the regional agenda jointly and on their own, to show unity in overcoming threats to regional stability and security, and to adopt a coordinated and unified stance in their dealings with actors outside the region.

Shavkat Mirziyoyev, the president of Uzbekistan, remarked that Central Asia is now universally acknowledged as a single entity with international subjectivity. This, he claimed, "is demonstrated by the approval of 8 UN resolutions since 2017 on significant Central Asian cooperation and development issues, as well as the formation of more than 10 "Central Asia Plus" formats.

In this respect, the President of Uzbekistan called “to develop common approaches to joint work within these formats at the level of foreign ministers.” The president of Kazakhstan, Kassym-Jomart Tokayev, also underlined the importance of “common or maximally similar positions demonstrating the solidarity and unity of the states of the region.”

Emomali Rahmon, President of Tajikistan, in response, emphasized the significance of the “unity of Central Asia" and urged the need to take more active steps towards integration within the region, including developing and making specific proposals for the joint development of Central Asia available to partners, including within the framework of the "Central Asia Plus" format.

Undoubtedly, the strengthening of political consolidation, coordination, and coherence of activities would allow Central Asian states to "protect and promote the region's common interests in the world" even more effectively, noted Sadyr Japarov, leader of Kyrgyz Republic.

At the same time, it is crucial to emphasize that the Central Asian states demonstrate the region's openness to cooperation with extra-regional countries, international and regional organizations, and their willingness
to rely on international law norms and principles and to firmly integrate the region into the international community as a responsible subject
of international relations. And the world community supports this.

This is demonstrated by the invitation to the summit of Azerbaijani President I. Aliyev, head of the UN Regional Center for Preventive Diplomacy for Central Asia K. Imnadze and the address to the participants of the meeting by UN Secretary General Antonio Guterres.

The enormous number of tangible ideas proposed during the Consultative Meeting attests to the Central Asian governments' determination to begin a new phase of cooperation. They not only represent a similar view of risks, problems, and opportunities, but they also complement and mutually reinforce each other, providing a solid foundation for their practical implementation.

Akramjon Nematov,

first deputy director of the Institute for Strategic and Regional Studies under the President of the Republic of Uzbekistan

Consolidation is an effective response to the challenges of our time

In general, today's Central Asian states, despite numerous challenges and threats exacerbated by the rise of geopolitical rivalries and contradictions,
as well as crisis phenomena in the global economy, manage to maintain
an atmosphere of friendship and mutually beneficial cooperation in Central Asia, build relationships with external actors while keeping regional stability in mind, and ensure security and sustainable development in the interests
of the people of our common Central Asia nest.

As the President of Kyrgyzstan Sadyr Japarov put it succinctly, “joint work, constant dialogue, and communication on the basis of mutual respect and consideration of each other's interests in the spirit of good neighborliness allow us to overcome all obstacles and difficulties, develop, and maintain the sense of commonality and unity of the peoples who have inhabited our vast and rich region since time immemorial”.  

Summarizing the outcomes of the first cycle of consultative meetings, we can state with confidence that the previous stage of Central Asian cooperation has become a breakthrough in the overall process of regional construction, enabled the establishment of ongoing intra-regional dialogue, developed a sense of commonality of interests, significantly strengthened mutual trust, and created solid ground for the transition of regional cooperation to a qualitatively new stage of development.

And as the summit in Dushanbe's outcomes have demonstrated, the leaders of the Central Asian states have shown that they are committed to moving forward with closer cooperation, have articulated their vision and particular priorities for regional cooperation, and are prepared to turn challenges into opportunities, create a new sustainable model of regional interaction that will ensure the continued development of the Central Asian states.

Akramjon Nematov,

first deputy director of the Institute for Strategic and Regional Studies under the President of the Republic of Uzbekistan

Central Asia - a space of good-neighborliness and new opportunities

Today, Central Asia is emerging as a key hub for interregional connectivity as well as global industrial and logistical chains. According to President of Uzbekistan Shavkat Mirziyoyev, “stability and unity are strengthening in Central Asia, it is turning into one of the important centers of economic growth and investment activity, and it is once again regaining its historical role as a transport hub connecting the West with the East and the North with the South.”

The leaders of other Central Asian countries agree with this assessment. Thus, Tajikistan's President Emomali Rahmon stated that “Central Asia is consistently and confidently transforming into an area of mutually beneficial cooperation, into a stable, economically developed, and, in the foreseeable future, very prosperous region, into one of the most important centers of the modern world and unique geographical nodes.”

In turn, the leader of Kazakhstan Kassym-Jomart Tokayev notes that regional cooperation not only brings tangible mutual benefits, but also alters the entire structure of the Central Asian economy by opening up new opportunities for trade, investment, business, science, and innovation.

Yes, this is the case. The development indicators for the entire region, which display a pattern of consistent growth, serve as proof of this. Particularly between 2016 and 2022, the Central Asian region's international trade turnover increased to reach 225 billion.

Simultaneously, commerce among the region's states increased 2.5-fold, from 5.5 to 13.5 billion, and is expanding in both structure and nomenclature of commodities, which has a substantial stabilizing effect on prices in the local markets of Central Asian republics.

Stability and the emergence of a robust market in Central Asia are increasing interest in the region. In particular, over the same period, the share of investment in Central Asia of the global total has increased from 1.6% to 2.8%, rising to 40 billion in 2022, and overall by 45% since 2016 of the total accumulated investment of 250 billion. Moreover, mutual investment increased 6 times, almost doubled intra-regional tourism.

Interest in the region has increased as a result of stability and the development of a thriving market in Central Asia.

In example, over the same time period, Central Asia's portion of global investment climbed from 1.6% to 2.8%, reaching $40 billion in 2022 and growing overall by 45% since 2016 of the total accumulated investment of 250 billion. Additionally, mutual investment surged six times, and intraregional tourism nearly doubled. 

As a result, the region's total gross output is expanding gradually. At the end of 2022, it increased by 6% and reached around $400 billion, which is 40% higher than in 2016 and double the dynamics of the global economy. At the same time, growth projections for the coming year range from 5 to 6 percent.

Akramjon Nematov,

first deputy director of the Institute for Strategic and Regional Studies under the President of the Republic of Uzbekistan

The previous stage of Central Asian cooperation has become a breakthrough in the overall process of regional construction

The Consultative Meeting of the Heads of Central Asian States, held on September 14 in Dushanbe, had literal historical and political significance.

It completed the full cycle of Central Asian summits began in 2018 at the initiative of Uzbekistan's President Shavkat Mirziyoyev and endorsed by the leaders of all countries in the area. The Dushanbe summit was held in an atmosphere of open and trusting communication, as well as a productive exchange of ideas. The leaders of Central Asian states evaluated the outcomes of past Consultative meetings and emphasized their unwavering commitment to continuing collaborative efforts toward the gradual building of a sustainable regional cooperation architecture.

The main conclusion of the five-sided meeting is that the process of regional rapprochement has reached a qualitatively new phase of integrational development, as evidenced by the greater willingness of the region's states to formalize and institutionalize multidimensional interaction, making it systematic and continuous.

The leaders of Central Asian states stated that it is in their best interests to continue to strengthen interstate cooperation, good neighborliness, and mutual trust in Central Asia.

The decision to form a Council of National Coordinators for the Consultative Meeting of the Heads of Central Asian States, aimed at increasing the effectiveness of interstate cooperation, is evidence of this.

And there's a reason for it. Regional countries were able to “make serious progress in resolving vital issues and to fill cooperation among Central Asian states with a qualitatively new content” thanks to shared political will and concerted efforts, as the President of Uzbekistan underlined.

Many barriers that were sources of interstate tension have been dismantled in recent years. Primarily, neighboring countries were able to address critical border issues, allowing transportation communications to resume.

The discourse on mutually beneficial use of water and energy resources, as well as guaranteeing water, energy, and food security, is currently underway. 

Cooperation links among Central Asian states are strengthening in
a variety of fields. They formed joint investment entities, work is underway to build cross-border industrial and trade zones, and interstate projects in the industrial, agriculture, automotive, and energy sectors are being launched. 
A visa-free regime has been implemented, as well as circumstances for free movement of citizens and active cultural and tourism interactions.  

Since 2016, Uzbekistan has increased the number of checkpoints with Central Asian countries to 78, tripled the number of bus services, and more than doubled the number of air flights.

Today, the boundaries between Uzbekistan and Central Asian countries can legitimately be referred to as bridges of peace and goodwill. For example, the Uzbek-Kyrgyz border can now be crossed with the display of an internal document - a general civil ID-card - starting September 1 of this year.

The work on trade and economic, transport and energy cooperation has reached a new stage. Thus, in 2020-2021 Uzbekistan created joint investment funds and companies with Kyrgyzstan and Tajikistan, in 2022 and 2023 began construction of cross-border industrial-trade and industrial zones with Kazakhstan, Kyrgyzstan, Tajikistan and Turkmenistan.

Projects are underway with Kyrgyzstan to build the China-Kyrgyzstan and Uzbekistan railroad and the Kambarata hydroelectric power plant, with Tajikistan - the Yavan hydroelectric power plant on the Zarafshan River, and with Kazakhstan - a multimodal transport and logistics center in Tashkent. These are just some examples, of which there are many in other Central Asian states.  

Of course, there are still concerns to be addressed. The most important thing, though, is to sustain dialogue and a solid course toward mutually accepted concessions. Today, it is critical to overcome narrow national egoisms, see the inextricable relationship between the region's sustainable future and its own development possibilities, and reach mutually beneficial solutions that fulfill the interests of all parties. And given the inertia of regional collaboration, this appears to be feasible.

“It is necessary to find common approaches and join efforts to find mutually acceptable solutions”, President of Kyrgyzstan stated. “There are no intractable problems, all we need is political will”.

Akramjon Nematov,

first deputy director of the Institute for Strategic and Regional Studies under the President of the Republic of Uzbekistan

The multidimensional poverty index will serve as a barometer of changes within the country

On September 20, 2023, a high-level conference was held at the UN Headquarters in New York within the framework of the UN General Assembly on the topic: "Leveraging the Multidimensional Poverty Index to Topple Interlinked SDGs", organized by the Multidimensional Poverty Peer Network (MPPN) and the Oxford Poverty and Human Development Initiative (OPHI).

The purpose of the event was to put the problem of poverty at the center of the discussion, as well as to stimulate action and develop cooperation to develop sustainable solutions that have a greater impact on people living in poverty and contribute to the well-being of the whole society.

Director of the Center for Economic Research and Reforms (CERR) Obid Khakimov made a report at the high-level event.

In his speech, the head of CERR noted that in recent years the government of Uzbekistan has made significant progress in solving the problem of poverty within the country. Uzbekistan is a country with a lower–middle income and a population of more than 36 million people. In 2022, approximately 14% of the population, which is about 5.4 million people, lived in poverty.

The solution to the problem of poverty also includes the adoption of the Strategy "Uzbekistan – 2030", which aims to reduce poverty by 7% by 2030. In addition, the approved Social Protection Strategy outlines plans to create a system that provides a minimum level of social protection for all citizens.

«This will be achieved by expanding the coverage and increasing the targeting of social assistance. Today, all social protection mechanisms are integrated within the newly established National Social Protection Agency in accordance with the guidelines of UNDP and UNICEF», — noted O.Khakimov.

In addition, in order to accelerate progress towards achieving the Sustainable Development Goals, in particular Goal 1, which is aimed at the widespread eradication of poverty in all its forms, the Government of Uzbekistan has recognized the problem of multidimensional poverty and has set the development of this indicator as one of the highest priorities. So, the national poverty line is based on minimum consumer spending.

During the speech, it was noted that currently in partnership with UNDP, UNICEF, Innocenti UNICEF and the Oxford Poverty and Human Development Initiative, Uzbekistan has initiated a pilot project to measure the Multidimensional Poverty Index (MPI). This work is aimed at a comprehensive analysis of the scale and depth of poverty, including child poverty, in the context of Uzbekistan.

The Director of the CERR told the participants of the event that the study included two stages: the first survey was conducted in 2022 among 1,500 households, where a definition of multidimensional poverty was developed.

In 2023, data was collected from 4,515 households, focusing on various socio-economic factors affecting the well-being of the people.

«These factors include education, employment, health, social protection, standard of living, access to information, nutrition, and so on. All the questions were carefully adapted to the specific context of Uzbekistan, which allowed us to develop an indicator that accurately reflects the unique aspects of deprivation in the country», — noted O.Khakimov.

Speaking about indicators of multidimensional poverty, it was noted that MPI includes 13 indicators grouped by 3 dimensions of well-being:

basic infrastructure and living conditions

health and social capital

financial inclusion and employment

«The preliminary results of the MPI study give us a complete picture of poverty in our country. To solve this problem, the Strategy "Uzbekistan – 2030" defines key goals, such as doubling the country's GDP and increasing the incomes of 4.5 million people at risk of poverty», — noted O.Khakimov.

During the speech, it was noted that the Strategy emphasizes social obligations related to the further development of the education system, including the expansion of pre-school education coverage and a minimum of 50% level of enrollment of young people in higher education institutions.

In addition, the priority is the development of the healthcare sector by doubling the financing of healthcare and achieving 100% digitalization of medical institutions.

In conclusion, O.Khakimov noted that the Strategy is aimed at ensuring full coverage of social protection for those in need and reducing the unemployment rate to 7% by providing stable and effective employment opportunities for everyone, including young people and people with disabilities.

Therefore, MPI will serve as a barometer of real changes within the country over the next 7 years.

CERR Public Relations and Media Sector