AGP Executive Report

Middle Corridor Boost: Armenia says the Akhalkalaki–Kars rail line is now open for freight, adding a new route via Georgia and Türkiye to reach the EU—on top of existing links through Russia, Kazakhstan and onward to China. Eurasian Connectivity Talks: Kazakhstan’s PM Olzhas Bektenov joined CIS talks in Ashgabat focused on digitalization and transport integration, including a CIS geospatial data push. Aviation Rules in Focus: Kazakhstan is drafting regulations for air taxis and urban air mobility, with eVTOL testing in Alatau City and plans for vertiports. Energy Partnership: Kazakhstan and ExxonMobil reaffirmed long-term cooperation, spotlighting Tengiz, Kashagan and Caspian Pipeline Consortium stability. Trade Momentum: Kazakhstan reports grain exports to Afghanistan hitting 3 million tons (up 2.3x), while grain and flour prices in Kabul show mixed easing. Quick Note: Recent coverage is heavy on regional transport and policy updates, with fewer Kazakhstan-only business headlines than usual.

Air Mobility Push: Kazakhstan has started eVTOL air-taxi test flights in Alatau City and is drafting rules for air taxis and urban air mobility, with vertiports planned by 2028—an early step toward a new aviation market. Aviation Connectivity: Prime Minister Olzhas Bektenov has asked Air Astana to open Astana links to New York and Tokyo by year-end, while noting route economics are complicated by sanctions and the closure of Russian airspace. Trade Momentum: Grain exports to Afghanistan hit 3 million tons since Sept 2025 to May 2026, up 2.3x, as Kazakhstan leans harder on southern transit routes. Regional Finance: Kazakhstan, Kyrgyzstan and Uzbekistan signed up to a Central Asian Islamic Finance Alliance to coordinate projects and attract Islamic capital. Cybercrime Warning: A “spamathon” is spreading fake emails, with reports of scams originating from Kazakhstan—experts urge people not to click suspicious links.

Air Mobility Rules Take Shape: Kazakhstan has started drafting regulations for air taxis and urban air mobility after eVTOL test flights in Alatau, with vertiports planned and six sites targeted for construction by 2028. Aviation Connectivity Push: Prime Minister Olzhas Bektenov urged Air Astana to open Astana links to New York and Tokyo by year-end, while noting route economics are complicated by sanctions and the closure of Russian airspace. Grain Exports Surge: Kazakhstan shipped 3 million tons of grain to Afghanistan since Sept 2025, up 2.3x, as logistics and trade ties with the region keep improving. Islamic Finance Cooperation: Kazakhstan, Kyrgyzstan and Uzbekistan signed an MoU to create a Regional Alliance of Islamic Finance, with Kazakhstan’s association set as the coordinating secretariat. Cyber Warning: A “spamathon” is spreading fake emails tied to cybercrime reports, urging Kazakh consumers to avoid suspicious links and reuse of passwords.

Air Mobility Rules Move Forward: Kazakhstan has started drafting regulations for air taxis and urban air mobility after eVTOL test flights in Alatau City, with legal amendments already in coordination and vertiports planned (six by 2028). Rail IPO Watch: Samruk Kazyna is preparing KTZ’s 2026 international IPO, targeting a triple listing (London, Hong Kong and Kazakhstan) as a primary equity offering to fund debt repayment and railway modernization. Transport Connectivity Boost: flydubai and Cyprus Airways launched an interline deal via Dubai (DXB), giving one-itinerary access to destinations including Almaty and Astana. Middle Corridor Push: Kazakhstan invited the EU to join an electronic permit exchange for international road freight along the Trans-Caspian route, alongside port upgrades and digital customs plans. Energy & Industry: Eni and GIP are expanding financing for Eni’s CCUS platform, while Kazakhstan faces more delays on its first nuclear plant. Visa Policy Signal: Thailand restored 30-day visa-free stays, and Kazakhstan is set to return to normal visa requirements under the revised rules.

Travel Industry Shake-Up: Ukraine’s Join UP! is moving from a classic tour operator to a vertically integrated “Travel Universe,” bundling airlines, destination managers, agencies, shops and direct online sales into one customer journey. Eurasian Politics: Moscow escalated its rhetoric against Armenia’s PM Nikol Pashinian ahead of June 7 elections, while Yerevan insists only Armenia can decide its EAEU status. Banking & Governance: Ukraine appointed Michael Weinstein to Sense Bank’s supervisory board, with prior experience linked to Kazakhstan’s finance ecosystem. Water & Food Security: Kazakhstan cut irrigation water use by 874 mln m³ via water-saving tech, and grain exports to Afghanistan jumped 2.3x. Transport Digitalization: Astana invited the EU to join an electronic permit exchange for the Trans-Caspian route as customs and logistics digitization accelerates. Migration Policy: Kazakhstan plans tailored visa regimes and a “Golden Visa” for four foreigner categories. Animal Health: Kazakhstan received WOAH recognition as foot-and-mouth disease-free without vaccination. Tech & Talent: Tokyo Governor Yuriko Koike praised Astana’s pace and pushed Kazakh firms to join Japan’s SusHI Tech startup event.

Budget Watch: Kazakhstan’s 2025 budget revenue plan was met at 98.6%, missing by 337bn tenge, with the gap driven by weaker corporate income tax and VAT collections, plus softer third-country exports and lower lead prices. AIFC Courtroom Win: Kazakhstan’s Astana International Financial Centre upheld Naftogaz’s push to enforce a Gazprom arbitration award, paving the way for about $1.4bn plus costs to be recovered. Aviation Modernization: The government is moving toward biometric boarding and AI cargo systems, while aerotaxi trials have started in Alatau and commercial service is still expected later. Trade & Corridors: Kazakhstan keeps pitching itself as a transit hub, with renewed focus on linking the Middle Corridor to Africa’s logistics routes, including talks with Kenya on direct flights and a trade council. Sanctions Pressure: A Finnish case highlights how trucks routed via Kazakhstan or Turkey can end up in Russia, while Kyrgyzstan has shut down 50 firms tied to likely sanctioned partners. Tourism Signals: Tajikistan reports a strong Q1 2026 tourism rebound, with Kazakhstan among the CIS sources.

Kazakhstan–Kenya Summit: Presidents Kassym-Jomart Tokayev and William Ruto wrapped up landmark talks in Astana, with a clear push to turn cooperation into deals—direct flights, a proposed Kazakhstan–Kenya Business Council, and a Kenya trade hub in Kazakhstan to link Central Asia with East Africa. Trade Momentum: Bilateral trade is already accelerating, with Kazakhstan–Kenya ties framed as a new “economic bridge” and Kazakhstan–Norway turnover up 37% to about $170 mln. Aviation Push: Kazakhstan is moving from tests to plans for aerotaxis—full testing in 2026 and possible passenger/cargo routes between Alatau–Almaty–Konayev in 2027. Food & Exports: Kazakhstan exported over 3.6 mln tons of wheat, while the state budget benefited from 6.5% GDP growth. Energy & Legal Pressure: Kazakhstan’s AIFC court cleared the path for Naftogaz to enforce a $1.4 bln arbitration award against Gazprom. Digital & Finance: Tokayev highlighted GovTech/FinTech know-how for Kenya and AIFC’s growing role as an investment platform.

Court Ruling on Gazprom Debt: Kazakhstan’s Astana International Financial Centre has recognized a Swiss arbitration decision, paving the way for forced recovery of about $1.4 billion from Gazprom in favor of Ukraine’s Naftogaz—an important first for enforcement in a local jurisdiction. Kenya–Kazakhstan Deal Push: During President William Ruto’s state visit, both sides signed agreements across ICT, e-government, transport, finance, mining, tourism, climate and space, with Tokayev also backing a Kenya trade hub in Kazakhstan and exploring use of Mombasa port for Kazakh grain and agri exports. Green Hydrogen Pilot: Kazakhstan unveiled its first full-cycle green hydrogen pilot in Atyrau, using solar power to produce hydrogen for heating and electricity, with a research focus on storage and transport. Trade & Logistics Outlook: Kazakhstan’s Q1 foreign trade turnover hit $32.9bn (+10.5% y/y), while Pakistan’s maritime minister invited Kazakh investors to port projects in Gwadar and Karachi. Transport Innovation: Almaty Region says commercial air taxi services likely won’t start before 2029.

Gazprom Debt Recovery: A Kazakh court has approved the forced recovery of $1.4bn from Gazprom for Naftogaz, following an international arbitration win—another step in turning a long-running gas dispute into enforceable payments. Kazakhstan–Kenya Push: President Kassym-Jomart Tokayev met Kenya’s William Ruto in Astana as both sides signed agreements and mapped cooperation in trade, energy, logistics and technology; Kazakhstan also plans to open an embassy in Nairobi, while Ruto received the Order of Dostyk, First Degree. Trade Momentum: Kazakhstan’s foreign trade turnover hit $32.9bn in Q1 2026, with exports up nearly 10%—imports rose faster on investment and tech goods. Aviation & Connectivity: FlyArystan adds more Astana–Urumqi flights, and Kazakhstan continues upgrading air navigation infrastructure over the next five years. Markets Watch (Zinc): Despite forecasts of surplus, zinc prices jumped after reduced output at Kazakhstan’s Kazzinc smelter and a fire-related shutdown in Peru.

Middle Corridor Push: Kazakhstan’s KTZ is moving to turn the Caspian into a logistics engine, signing for six multi-purpose vessels to integrate a maritime leg into the Middle Corridor, while also advancing plans for a Kazakh cargo airline. Trade & Connectivity: Pakistan is actively courting Kazakh capital for Gwadar and Karachi port projects, pitching off-dock terminals and broader road/rail/air links to boost access to Gulf, Africa and Asia markets. Finance Link-Up: Kazakhstan wants deeper financial services cooperation with Hong Kong, aiming to tap renminbi capital via bond issuances and pairing it with digital finance and AI. Diplomacy in Motion: Kenya’s William Ruto arrives for a state visit to expand trade and cooperation across finance, tourism, ICT and energy; Oman and Kazakhstan also signal investment-focused talks. Geopolitics Watch: Russia warns it’s concerned about US/EU rare-earth moves in Central Asia, while Armenia’s EAEU status remains a live dispute. Energy Transition: TotalEnergies confirms a $1.2bn wind-plus-battery project in Kazakhstan using Chinese turbines, targeting full power by 2029.

Middle Corridor Push: KTZ says it will build its own Caspian fleet—six multi-purpose vessels (up to 537 TEU each) plus plans for a 10-jet cargo airline—to tighten logistics for the Middle Corridor. Investment Shield: Tokayev signed Kazakhstan’s law ratifying an investment protection deal with China, locking in a stronger legal framework for bilateral capital flows. Aviation Links: Kazakhstan plans direct flights from Astana to Tokyo (Q4 2026) and New York (Q2 2027), with FAA Category 1 work underway. Energy & Industry: TotalEnergies confirmed a $1.2bn Mirny wind-plus-battery project in Kazakhstan using Chinese turbines, targeting full power by 2029. Tech & Cities: Kazakhstan showcased AI-driven, human-centered urban development at WUF in Baku, while education reforms aim to better match labor needs. Regional Security: Tokayev hosted Central Asia–China interior ministers to tackle cybercrime, drugs, and extremism. Reputation & Sentiment: A new survey finds 84.4% of Kazakhs say the country is moving in the right direction, and Kazakhstan ranks top in Central Asia on a global reputation index.

Sanctions Evasion Crackdown: Germany says it has uncovered a network smuggling Western dual-use components into Russia’s nuclear and submarine programs, with a Lübeck arrest tied to intermediary firms across Germany, Central Asia and the Caucasus. Geopolitics: China is set to host “old friend” Putin again, framing the Xi–Putin visit as proof of a stable partnership after Trump’s recent trip. Aviation & Mobility: Air Astana marks 24 years of growth, while Astana finally launches its long-delayed light rail link to the airport. Investment & Growth: Kazakhstan’s fixed capital investment rises 6.7%, World Bank data points to strong investment activity, and real salaries are up 41% over nine years. Cars & Policy Pressure: Passenger car registrations near five million, but aging fleets remain a drag. Security Focus: Tokayev urges tighter security as Middle Corridor freight traffic grows, and Kazakhstan chairs UN non-proliferation talks. Regional Business: John Lee will visit Kazakhstan and Uzbekistan with a record-sized delegation; Freedom Holding’s CEO meets Pakistan’s PM to push financial-market development.

Turkic Unity, Minus the Military Talk: President Tokayev used the OTS summit in Turkistan to shut down any idea of a Turkic military alliance, calling the bloc a platform for trade, tech, digital and culture—while also pushing AI and digital cooperation. Astana’s Big Transport Comeback: After years of delays and corruption probes, Astana launched Central Asia’s first fully automated driverless light rail line, linking the airport to Nurly Zhol. Business Pressure Crackdown: Kazakhstan charged four officials for pressuring rail and customs-linked businesses, with prosecutors saying restrictions were lifted after intervention. Water and Climate Stress: Kazakhstan rolled out an artificial rainfall project in Turkistan aimed at boosting precipitation over 911,000 hectares, as the region remains among the world’s highest water consumers. Energy Jitters: The IEA warned oil inventories are being drawn down fast, raising the odds of more price volatility ahead of peak summer demand. Humanitarian Moves: Kazakhstan sent 30 rail wagons of aid to Iran, including food staples and medicines.

Astana Light Rail Launch: Central Asia’s first urban light rail started operating in Astana on May 16, with a CSCEC unit as main contractor—another Belt and Road milestone aimed at easing city travel. Turkic Integration Push: Kazakhstan’s Tokayev used the Organization of Turkic States summit to stress solidarity, AI and digital development, and proposed digital monitoring/innovation centers across member states. Trade Momentum: The Eurasian Development Bank says intra-Central Asia trade nearly doubled over five years to $12.3bn in 2025, with Kazakhstan supplying 54% of goods. Talent Spotlight: A Kazakh 11th-grader, Arnur Artykbay, won awards in the U.S. for an AI system to detect malignant tumors. Regional Water Resilience: Kazakhstan launched a large artificial rain project in Turkestan to boost reservoir filling and support agriculture. Energy & Diplomacy: Separate calls saw Tokayev speak with Putin and Aliyev, while Kazakhstan also backed nuclear cooperation tied to the Balkhash NPP.

Middle East Pressure: US President Trump warned Iran “the clock is ticking” as talks stall, while Iran’s foreign ministry accused Washington and Israel of “manufacturing crises” to justify escalation. Astana Mobility Upgrade: Kazakhstan’s first urban light rail entered operation in Astana on May 16, with Chinese contractor CSCEC leading; residents have already started using the airport-to-city line. Turkic Business Push: A US–Turkic Republics Business Alliance was launched in New York to connect entrepreneurs across Kazakhstan, Türkiye, Azerbaijan and others, aiming to expand a network of hundreds of firms. Turkic Summit Tech Agenda: Tokayev used the OTS informal summit to stress solidarity and digital cooperation, including AI and digital integration. Water Security Experiment: Kazakhstan launched a first-in-Central-Asia artificial rain project in Turkistan, targeting reservoir and farm water needs. Energy/Transit Context: Ukraine’s FM said Kazakhstan is key for logistics, energy supply and post-war reconstruction, while Iran-related transit alternatives keep growing.

Turkic Summit Momentum: Kazakhstan’s Tokayev stressed Turkic solidarity as geopolitics tightens, while proposing digital monitoring and innovation centers inside the OTS and pushing AI/digital cooperation as a competitiveness and security tool. Cybersecurity Push: Tokayev also floated creating a cybersecurity council within the OTS, signaling a more coordinated tech agenda. Astana Mobility Upgrade: LRT passenger service has started in Astana, linking the airport to Nurly Zhol with 18 stations and a ~40-minute airport-to-city ride. Balkhash Nuclear Step: Kazakhstan and Rosatom discussed Balkhash NPP preparations, including site monitoring, workforce training, and localization—Kazakh firms are set to participate in construction. Humanitarian Delivery: Kazakhstan handed 30 railway wagons of aid to Iran’s Red Crescent, including food and medical supplies. AI Adoption Ranking: Kazakhstan was ranked a Central Asia/EAEU leader in AI use (Microsoft data). Climate Resilience: Turkistan launched an artificial rain enhancement project with UAE cooperation to protect 911,000 hectares of farmland.