OMM Newsroom
Kazakhstan marks Republic Day on Oct. 25. As it expands its economic agenda, the country is also developing its partnership with Azerbaijan: the two Caspian states are seeking to deepen cooperation in trade, transport, energy and digital infrastructure.
Azerbaijani President Ilham Aliyev sent Kazakh President Kassym-Jomart Tokayev congratulations on the national holiday, praised Kazakhstan’s economic development and highlighted the importance of their strategic partnership, AnewZ reported. Before the message, the two leaders reaffirmed their intention to increase bilateral trade at a meeting in Baku on Oct. 15.
Trade between the two countries totaled $282.9 million in January-August 2026, according to Kazakhstan’s Bureau of National Statistics. The launch of a 380-kilometer fiber-optic cable laid beneath the Caspian Sea is another step toward extending economic cooperation beyond traditional goods and energy trade.
Diversifying Kazakhstan’s economy
Kazakhstan has the largest economy in Central Asia. Oil, gas and mineral resources account for a significant share of the country’s industrial output and export revenues.
Kazakhstan is among the world’s leading uranium producers and also has reserves of coal, copper and other minerals. Agriculture, manufacturing, transport, financial services and trade also contribute to its economy.
Its location between China, Russia and the Caspian Sea gives Kazakhstan a significant position in Eurasian trade. Transport infrastructure and access to international markets are therefore central to the country’s economic strategy.
Alongside energy and mining, Kazakhstan is seeking to expand other sectors of its economy. Small and medium-sized enterprises’ share of GDP rose from 31.7% in 2019 to 40.9% in 2025, according to figures from Kazakhstan’s Bureau of National Statistics and government sources.
Over the same period, annual housing construction increased from 13.1 million square meters to 20.1 million square meters, a rise of about 53%. Renewable sources’ share of electricity generation grew from 2.3% in 2019 to 7% in 2025.
These figures point to changes in the business environment and infrastructure development. However, the economy remains heavily dependent on extractive industries and vulnerable to fluctuations in global commodity prices. Economic diversification, investment and stronger international transport links remain important for long-term growth.
Trade and cooperation on the Middle Corridor
Azerbaijan and Kazakhstan aim to raise annual bilateral trade to $1 billion. The two leaders reaffirmed this goal at their meeting in Baku on Oct. 15.
Kazakhstan exported $248.3 million worth of goods to Azerbaijan and imported $34.6 million worth from Azerbaijan in January-August 2026, according to Kazakhstan’s Bureau of National Statistics. Kazakh exports to Azerbaijan were therefore more than seven times the value of imports. Azerbaijan accounted for 0.3% of Kazakhstan’s total foreign trade turnover.
The $1 billion target is an annual figure, while the reported $282.9 million covers eight months. The two figures therefore cannot be directly compared over the same period.
Azerbaijan and Kazakhstan established diplomatic relations in 1992, and a joint intergovernmental commission on trade and economic cooperation has been operating since 1999. The economic agenda includes agriculture, industry, energy, investment, transport and communications. Expanding trade will depend not only on political agreements but also on identifying new products, businesses and investment projects that can sustain commercial activity.
On April 8, Azerbaijani Foreign Minister Jeyhun Bayramov reported on his meeting with Kazakh Foreign Minister Yermek Kosherbayev. The sides discussed the importance of high-level political dialogue, expanding trade and economic cooperation, and strengthening connectivity through the Trans-Caspian International Transport Route. They also exchanged views on regional and international security, joint efforts for peace, stability and sustainable development, and cooperation in regional and international organizations.
The economic importance of the Azerbaijan-Kazakhstan partnership is also reflected in the Middle Corridor, which links Central Asia with Europe through the Caspian Sea and the South Caucasus. Cargo volumes along the route rose from about 800,000 tons in 2020 to 4.5 million tons in 2024, before falling to about 4.1 million tons in 2025, according to Kazakhstan’s Ministry of Foreign Affairs.
Container traffic continued to grow: about 77,000 TEU were transported along the corridor in 2025, 36% more than the previous year. The Kazakh government estimates the corridor’s current annual capacity at about 6 million tons and 80,000 containers. Plans call for increasing those figures to 10 million tons and 300,000 TEU by addressing infrastructure constraints.
Azerbaijan is a key part of this transport network. Cargo passing through Kazakh ports accounted for about 35% of the annual cargo turnover at the Baku International Sea Trade Port, or 2.6 million tons in 2024, according to the Center for Analysis of Economic Reforms and Communication.
Energy cooperation also has measurable results. About 4.5 million tons of Kazakh oil were transported through Azerbaijan from March 2023 to July 2026, according to SOCAR. The crude oil crossed the Caspian Sea and was shipped through the Baku-Tbilisi-Ceyhan pipeline. The route provides Kazakhstan with an additional export option and enables Azerbaijan to expand its oil transit services.
Although the corridor has developed rapidly since 2020, the decline in total cargo volume in 2025 shows that increasing infrastructure capacity must be accompanied by reliable demand, competitive costs and efficient cross-border operations.
On Oct. 15, Azerbaijan and Kazakhstan launched a 380-kilometer underwater fiber-optic cable between Sumgait and Aktau. The cable has a designed capacity of more than 400 terabits per second.
Built by AzerTelecom and Kazakhtelecom under the Digital Silk Way initiative, the connection is intended to transmit data between Asia and Europe. The project is expected to create opportunities for investment in telecommunications, cloud services and data centers. Its commercial value will depend on the traffic it attracts.
Azerbaijan and Kazakhstan aim to increase annual trade turnover to $1 billion, following the $282.9 million recorded in the first eight months of 2026. Expanded cargo capacity, oil transit and digital infrastructure could create new revenue streams; their economic impact will be measured by growth in trade, investment and commercial demand.
