The economies of Central Asian countries are growing
The latest European Bank for Reconstruction and Development (EBRD) report shows that in the first half of 2023, Central Asian countries recorded significant growth. Tajikistan recorded the highest growth rate – 7.5 percent, the economy of Uzbekistan grew by 6.5 percent, Kazakhstan – by 5 percent, and Kyrgyzstan – by 4.6 percent.
Dr. Anna Mateeva from the Russian Institute of King’s College in London, citing the portal, points to a “very clear” reason for this phenomenon – the Russian armed invasion of Ukraine, which “prompted citizens of Russia and Belarus to transfer their money and companies to Central Asian countries to avoid Western sanctions.” However, it “fueled domestic consumption and demand for refined goods.”
The British analyst added that Russian companies moved mainly to Kazakhstan and Kyrgyzstan, and their geographical and cultural proximity made this process much easier. What also makes the situation easier is that both countries are members of the Eurasian Economic Union (which also includes Russia, Belarus and Armenia), which facilitates economic integration thanks to the common market, single regulations and free trade area.
Russian interests in Central Asia. Here are the advantages
“It is known that people prefer to go to Western Europe or the United States,” Matieva confirms. “But staying in Central Asia has certain advantages. One of them is that people can come and go without restrictions, without the need for permanent migration.” .
The GDP growth of Central Asian countries – according to the European Bank for Reconstruction and Development report – also depends on the money that millions of economic migrants from the region, who work in low-paid sectors of the Russian economy, send to their countries of origin.
Experts also believe that Central Asian countries are helping Russia avoid sanctions imposed by the West in connection with its invasion of Ukraine. According to the Brussels-based Bruegel Research Center, Kazakhstan has significantly increased its imports of goods covered by sanctions imposed on Russia after its attack on Ukraine. In the period from January to October 2022, Kazakh companies exported 18 times more electronic equipment to Russia than in the same period of 2021.
Western sanctions ‘ineffective and useless’
An analyst from the King’s College Russian Institute believes that in Central Asian countries, Western sanctions against Russia are viewed as ineffective and meaningless, she says. She added, “This does not mean that what Russia is doing in Ukraine is acceptable. But the West’s reaction is not considered appropriate.”
She added that although the impact of the war in Ukraine is largely beneficial for the region, this is not entirely true, because due to sanctions, the ability of Central Asian countries to export and transport goods has decreased, as most of the roads pass through Russian territory. .
“The West, in its desire to hurt Russia, has to think about what this means for other countries that don’t really have many other options. The pressures being exerted by Western countries (…) are increasing anti-Western sentiment where it did not exist.” Before,” concludes the expert. From King’s College Russia.
Euronews also reported that Kazakh authorities fear Ukrainian drone attacks on the Black Sea Caspian Pipeline Consortium terminal, which could disrupt oil exports.
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