PROSPECTS FOR ECONOMIC COOPERATION IN CENTRAL ASIA

Abstract

This research article examines the state and prospects of economic cooperation among the countries of Central Asia (CA). As history would have it, economic cooperation within the CA region was previously limited, and investments in Central Asia were mainly concentrated in the mining sector of the economy. Demographic and economic trends in the region have led to an expansion of the internal market; most Central Asian states have implemented wide-ranging reforms, which have improved the overall investment climate; and the CA states have stepped up the development of multilateral trade and economic relations, laying the groundwork for broader cooperation. The article also covers recent problems related to the economic situation in the region. For example, the current situation associated with COVID-19 has had an impact on economic relations between the CA countries. In the view of international experts, this crisis has not provided any new reasons for integration in the region. The quarantine measures taken in various Central Asian countries have had a negative effect on their foreign trade and thus on intra-regional trade and economic cooperation in general. The authors also examine other problems, such as those caused by the CA countries’ economic dependence on other countries, namely their dependence on imports from outside the region. These problems also affect the prospects of economic cooperation in Central Asia. All countries, including those rich in natural resources, want to produce and export finished goods with high value added. The production of high value added products and services enables a country to earn more revenue and reduce its dependence on primary commodity exports. The Central Asian countries are no exception. But for many reasons their finished products are often insufficiently competitive in countries outside the region. Despite the existence of economic problems connected with the need to improve the economic aspects of cooperation, there is a clear trend towards diversification of the economy of the CA countries caused by a desire to develop various specializations. These include agricultural processing, production of consumer goods for the population, development of the service sector, and other areas. Thus, the choice of a new model for the development of multilateral relations and the emerging trend towards economic growth in the region have made it possible to lay the foundation for long-term cooperation among the Central Asian states. Keywords: regional cooperation, Central Asia region, diversification of the economy, trade regimes, external economic policy, region, Kazakhstan, Uzbekistan, Tajikistan, Turkmenistan, Kyrgyzstan.