Azerbaijan-Kazakhstan multilateral ties give impetus to trade & energy co-op

Through its strategic policies, Azerbaijan has cultivated robust economic and political partnerships with neighboring countries, European states, Western nations, and Central Asian countries. The nation particularly values its relationships with Turkish states, with Kazakhstan being a prominent and strategic partner in this network.

A major factor in strengthening these relations is the strong personal rapport between the heads of state of Azerbaijan and Kazakhstan. In recent years, the frequent visits between President Ilham Aliyev of Azerbaijan and the Kazakh head of state have become a regular feature of their diplomatic engagement.

These robust relations are also evident in the economic sphere. According to the National Bureau of Statistics, trade turnover between Kazakhstan and Azerbaijan reached $280.6 million in January-June 2024. During this period, Azerbaijan exported $24.5 million worth of goods to Kazakhstan, while imports from Kazakhstan amounted to $256.1 million.

Azerbaijan’s share in Kazakhstan's total trade turnover was 0.4%, and its share in Kazakhstan’s total exports was 0.7%. Last year, the trade turnover between the two countries totaled $598.47 million.

There are currently 182 commercial entities in Azerbaijan with Kazakh investment across various sectors, including industry, agriculture, construction, transport, trade, and services. Kazakhstan invested $102.2 million in Azerbaijan, while Azerbaijan invested $205.2 million in Kazakhstan.

A key project enhancing economic relations between the two countries is the Trans-Caspian International Transport Route, also known as the Middle Corridor. This significant initiative connects China, Kazakhstan, Azerbaijan, Georgia, Turkiye, and European countries across the Caspian Sea.

Operating since 2014, the Middle Corridor is considered the most efficient and secure route for transporting goods between China and Europe. In 2023, approximately 2.8 million tons of cargo were transported via this route, an 86% increase from 2022. The volume of cargo transportation is expected to exceed 4 million tons in 2024, with around 250 container block trains planned to transit through the corridor by year-end.

Notably, in the first half of 2024, cargo transportation on the Trans-Caspian International Transport Route increased by 65%, reaching 2.1 million tons. This growth not only highlights the corridor's importance but also offers unique opportunities for further cooperation among countries across this expansive region.

The Joint Intergovernmental Commission on Trade and Economic Cooperation, established in 1999, plays a crucial role in advancing bilateral relations between Azerbaijan and Kazakhstan. To date, the commission has held 21 meetings, with the most recent one occurring this year. Beyond bilateral engagements, cooperation between the two countries continues to thrive at the multilateral level, particularly within the framework of the Organization of Turkic States (OTS). Both nations are committed to expanding and deepening their collaboration within the OTS.

On July 6, an informal summit of the Organization of Turkic States took place in Shusha, where the Garabagh Declaration was signed. This declaration emphasizes the development of stable and multifaceted relations among Turkic states and underscores the importance of leveraging the full potential and opportunities in political, economic, transport, defense, humanitarian, educational, and cultural domains.

It is notable that the combined gross domestic product (GDP) of OTS member countries exceeds $1.5 trillion. The trade turnover within the OTS framework has reached $42.3 billion, while the total trade turnover of Turkic states with the global market is approaching $1.3 trillion. Member countries are actively participating in global economic processes, and being represented in major international organizations.

Azerbaijan and Kazakhstan also maintain a robust partnership in the traditional energy sector. Noteworthy aspects of their cooperation include the transportation of Kazakh crude oil to global markets via the Baku-Tbilisi-Ceyhan pipeline, the processing of Kazakh crude oil in Azerbaijan, and other related activities, which highlight the success of their oil and petroleum product relations.

Furthermore, the road map signed between SOCAR and "KazMunayGaz" in 2023 has significantly enhanced opportunities for expanding their collaboration. This effective mutual cooperation, encompassing oil processing, transit, and commercial relations, has catalyzed Azerbaijan's rapid development, reinforcing its status as a regional energy hub.

In conclusion, Azerbaijan's strategic policies have significantly strengthened its economic and political partnerships with a diverse array of countries, including its key partner, Kazakhstan. The frequent high-level exchanges between the leaders of both nations, coupled with a robust economic relationship characterized by substantial trade and investment, underscore the depth of their bilateral ties. The Trans-Caspian International Transport Route, also known as the Middle Corridor, exemplifies their successful collaboration and its impact on regional connectivity and trade efficiency.