During the Council of Heads of State of the Organization of
Turkic States summit in Bishkek, the President of Uzbekistan, Shavkat
Mirziyoyev, proposed establishing a forum in Tashkent for leading
think tanks. This forum would conduct research aimed at expanding the
trade potential of the Organization’s member states. Such economic
research is already being successfully carried out jointly with
Azerbaijan.
In recent years, trade, economic, and investment cooperation
between Uzbekistan and Azerbaijan has demonstrated dynamic growth,
reflecting the strategic nature of bilateral
relations.
Both countries are actively increasing trade turnover, expanding
the range of mutual supplies, particularly in the agro-industrial
complex, textile production, petrochemicals, and mechanical
engineering.
Over the past 8 years, trade volume has increased 7.8 times,
amounting to $253 million in 2024. Uzbekistan’s exports to Azerbaijan
have grown 7.5 times to $208 million, while imports have increased 9
times, reaching $45 million last year.
In the past year, the main export commodities were machinery and
transport equipment – $61 million (29% of exports),
agricultural and food products – $33 million (16%, including
fruits and vegetables – $19 million), textiles and clothing – $32
million (15%), metals and metal products – $32 million
(15%, including copper worth $24 million), and tobacco
products – $20 million (10%).
In 2024, Uzbekistan imported agricultural and food products worth
$22 million from Azerbaijan (48% of imports, including sugar
worth $14 million), aluminum – $8 million (18%), and
equipment – $4.6 million (10%).
Significant attention is paid to investment cooperation, with
both parties implementing joint projects in industry, agriculture,
energy, and pharmaceuticals. Investments from Azerbaijan into
Uzbekistan have surged from $142,000 in 2017 to $79.5 million in
2024. The Azerbaijan-Uzbekistan Investment Company operates with an
authorized capital of $500 million.
Regular intergovernmental meetings and business forums contribute
to deepening partnerships, fostering a favorable investment climate,
and strengthening business ties between entrepreneurs of both
countries. Specifically, the number of enterprises with Azerbaijani
capital in Uzbekistan has increased from 178 in 2019 to 278 by the
end of April 2025.
An important area of cooperation has been the development of
transport and logistics corridors, including the use of the
Trans-Caspian route, which strengthens regional integration and
facilitates Uzbekistan’s access to global markets.
Despite the historical successes already achieved, there remains
significant untapped potential that can be realized by strengthening
economic cooperation.
The main part of this report will focus on the results of the
model tested last year for conducting research to identify new growth
areas for cooperation between the countries.
On the initiative of the President of the Republic of Uzbekistan,
Shavkat Mirziyoyev, in September 2024, a delegation from the Center
for Economic Research and Reforms visited Azerbaijan to study the
country’s socio-economic reforms.
This experience has become a model of applied analytical work
integrated into the state policy-making process. During the visit,
more than 20 meetings were held with government bodies, special
economic zones (SEZs), research institutes, and businesses.
The study involved a comparative analysis of 18 sectors, including
the examination of key indicators, government support, investment
potential, comparative advantages of goods, and key reforms. Concrete
proposals were prepared in the areas of energy, industrial
cooperation, agricultural digital systems, logistics, tourism,
digitalization, and institutional reforms.
For reference, 33 proposals were approved by the Order of the
Cabinet of Ministers of the Republic of Uzbekistan on October 11,
2024.
In particular, an interdepartmental working group
“Azerbaijan-Kazakhstan-Uzbekistan” was created to develop joint
projects in the field of “green” energy. Based on Azerbaijan’s
experience in agricultural insurance, a draft law “On Insurance of
Agricultural Risks” has been developed (submitted for consideration
by the Cabinet of Ministers of the Republic of Uzbekistan).
Currently, the implementation of several projects is underway. One
of the key projects is the establishment of a household appliance
production process in the “Alat” SEZ in Azerbaijan. The project aims
to develop local production and strengthen industrial cooperation
between the countries.
Work is underway to implement the “Industry Readiness Index for
Digitalization” program, based on Azerbaijan’s experience. As part of
this work, a detailed action plan is being developed for
implementation by 2026, which will be an important tool for
accelerating digitalization in industry.
In addition, a large language model for the Uzbek language is being
developed in Azerbaijan using artificial intelligence technologies,
which will be a significant step in the field of digitalization and
adaptation of the Uzbek language to modern technologies.
No less important is the launch of a dual-degree program in
conjunction with the Azerbaijan Economic University, aimed at
developing academic and educational cooperation between the
countries.
Also, in November 2024, a return visit to Uzbekistan was organized
by a delegation from Azerbaijan. During the visit, 14 meetings were
held with representatives of government bodies, special economic
zones, businesses, and higher education institutions.
Following the meetings, the delegation of the Republic of
Azerbaijan prepared a list of proposals for further areas of mutually
beneficial cooperation between Uzbekistan and Azerbaijan. The
proposals resulting from the two visits are being considered for
inclusion in the draft Roadmap for cooperation between the countries
for the next 5 years. Thus, the tested model of mutual visits by
analytical circles is already becoming an example of institutionalizing
applied analytics and accelerating industrial and digital
development.
I. Industrial Cooperation
Our countries aim to identify and implement promising projects in
manufacturing industries that have high added value and generate
significant multiplicative and synergistic effects for the
economies.
In this direction, it seems promising to establish joint
production of new products from hydrocarbons, such as synthetic
fabrics, for which there is significant demand in Uzbekistan due to
its developed textile and garment sector, as well as carbon fiber,
which has a wide range of applications.
Also, our business circles may be interested in jointly
establishing the production of products imported from third countries.
As an example, we can cite chemical products in demand in both
markets, in particular polyvinyl chloride, melamine (used in the
production of dyes and herbicides).
Both countries are interested in creating export-oriented
production of products with high added value. In this context, given
Azerbaijan’s strategic logistical location, as well as the conditions
being created for business, Uzbekistan is interested in locating
export-oriented enterprises from the textile and electrical
industries in the special economic zones of Azerbaijan.
In the context of the global “green” agenda, cooperation in the
production of electric vehicles and the construction of
infrastructure for electric transport may also be no less
promising.
Within the framework of industrial cooperation, the jewelry
industry cannot be ignored. Uzbekistan may be interested in attracting
jewelry companies and masters from Azerbaijan. In addition, it would
be possible to organize fairs of products made by jewelry masters in
both countries.
II. Agro-Industrial Cooperation
The next promising direction is agro-industrial
cooperation.
A great potential for cooperation between entrepreneurs in the
agro-industrial complex is the combination of efforts in areas where
both sides have comparative advantages. This is winemaking,
pomegranate growing, and industrial processing of agricultural
products.
In addition, cooperation and development of mechanisms for jointly
entering the markets of third countries with agricultural products
will strengthen the competitive advantages of both countries and
conquer new niches. Moreover, given the volume of exports of such
products by both countries – a total of $3.4 billion (Azerbaijan
– $1 billion, Uzbekistan – $2.4 billion)
It will be relevant to combine efforts in the scientific and
breeding field – in particular, establishing close cooperation,
implementing joint research and breeding projects between research
agricultural institutes of the two countries. For reference, there
are 7 of them in Azerbaijan and more than 30 in Uzbekistan.
III. Transport Sector
Another area is cooperation in the field of
transport.
It seems promising to develop new regulations for the
transportation of strategically important goods (such as sugar,
vegetable oil, other food products) and products of large
companies through the Middle Corridor with the provision of preferential
tariffs.
It is also necessary to consider the participation of Uzbek
construction companies in projects for the restoration and development
of transport infrastructure in the liberated territories of
Azerbaijan.
IV. Trade
In the direction of trade, it seems promising to attract
representatives of Azerbaijani retail to implement projects in
Uzbekistan — this is the launch of supermarket chains, logistics and
distribution, as well as the supply and sale of Uzbek products in
retail chains in Azerbaijan.
Also, our Center studied the work of the AzExport portal – a
platform for selling Azerbaijani goods in domestic and foreign
markets. Proposals were put forward to connect manufacturers and
suppliers from Uzbekistan to orders received through the platform as
well. This could become a popular mechanism for
entrepreneurs.
V. Tourism
The next promising area for expanding cooperation is tourism. The
current indicators of mutual tourism do not correspond to the
potential – in 2024, Uzbekistan was visited by 16 thousand citizens
from Azerbaijan. In this regard, during the discussions, the demand
for:
– holding an annual interstate tourism business
forum,
– creating joint unified tourist brands (similar to Silk
road)
– launching a permanent mechanism for exchanging information
between representatives of business tourism in Uzbekistan and
Azerbaijan.
Also, to increase the level of cooperation in the field of
tourism, it is necessary to introduce combined tourist products to
attract tourists from third countries in the areas of gastronomic,
health, and ski tourism (for example, a system of benefits for
tourists visiting ski resorts in both countries)
VIII. Educational and Scientific Research
Cooperation
As the last direction, I would like to highlight the developed
initiatives for possible cooperation in the field of education and
research activities.
Training qualified personnel is the cornerstone for the successful
development of any country. Technical specialties are more relevant
today than ever, therefore it is necessary to expand the practice of
launching double degree programs between universities in our countries
in the areas of training engineers.
To expand the boundaries of cooperation and give it a more
scientific character, it seems promising to create an interstate
scientific expert council and launch joint research on an in-depth
study of potential areas of long-term socio-economic cooperation
between the countries.
Conclusion
The dynamic development of Uzbek-Azerbaijani relations clearly
demonstrates how analytical support and applied scientific work can
become a powerful catalyst for economic cooperation. The experience of
Uzbekistan and Azerbaijan shows that close integration of research
activities and business practices can not only identify new areas of
joint development, but also successfully implement them at the state
level.
The results of such initiatives are expressed in specific projects
that create jobs, form new industries, and strengthen the positions of
both countries in the international market.
At the same time, the potential for bilateral cooperation is far
from exhausted. Deep cooperation in the fields of industry,
agro-industrial complex, digital technologies, and logistics, supported
by joint educational and scientific projects, can bring the economic
partnership between Uzbekistan and Azerbaijan to a qualitatively new
level.
In the coming years, such mutually beneficial cooperation can
become a model of regional integration and sustainable economic growth
for the entire Central Asian and Caucasian regions.
Obid Khakimov,
Director of the Center for Economic
Research and Reforms