Central Asia’s Alternative: Western Investment in Central Asia

By John W. Parks

Central Asia’s open doors have increasingly welcomed foreign investment over the decade. Though China throws large swaths of money at the region, the West (the U.S. and Europe) are not sitting the bench in this great game. Western interests and investments in Central Asia reflect the increasingly globalized nature of the world economy. However, Western investments take on a similar, yet different, form than the Chinese efforts. Instead of primarily investing in trade infrastructure (such as ports, roads, and railways), the West also engages in social and political development, energy infrastructure, and manufacturing.

Currently, Kazakhstan has a goal to reach $150 billion in foreign investment by 2029, a goal made possible through the disruption to traditional Eurasian relations which the war in the Ukraine has caused. Kazakhstan’s largest investor, the Netherlands, wired over $12 billion to the country in 2022 and 2023. The United States and Switzerland take the positions of second and third respectively when it comes to investing in Kazakhstan. Certain aspects of the United States’ funding in Kazakhstan have come under fire on both ends for encouraging activism instead of physical development projects, causing cuts in funding under the renewed Trump administration. It is unclear how the C5+1 and B5+1 partnerships between Central Asian states and the United States will be affected by the change in the White House.

Nevertheless, Western investment reaches Central Asia through other channels. Of significant notability, Starlink has attempted expansion of its network to rural Kazakh towns and schools despite efforts by local officials to ban foreign telecommunications services. By August 2024, Starlink had connected 1,731 rural schools to its service through its terminals. American company Wabtec announced in 2023 a $1 billion investment in Kazakhstan’s logistics industry. General Electric has also participated in Kazakhstan’s decarbonization plan by aiding in gas, nuclear, and hydroelectric power initiatives. British company Concrete Canvas also plans to build a flexible concrete manufacturing plant in Kyrgyzstan to repair the country’s canal systems.

President Trump’s policy changes could possibly change the allocation Central Asia receives from the West, but effects have yet to be seen and investment is not likely to leave Central Asia entirely. The global trade war between the West and China may open another theater in the Central Asian region as these states continue accepting investments from both, but what is certain is that Central Asia remains open for business.