Azerbaijan, Kazakhstan expand capacity of Middle Corridor, boosting transit between Asia & Europe

The economic and cultural relations between Azerbaijan and Kazakhstan are sound, and the history of these relations traces back thousands of years. Remaining true to their histories and traditions, these two countries could develop good relations based on mutual respect. Currently, Azerbaijan and Kazakhstan collaborate in various fields. The two countries have numerous joint initiatives that aim at strengthening cultural ties and increasing tourist flows between the two countries. Here, it includes a number of projects that are important both for the two countries and for the region as a whole. This is the expansion of the capacity of the Trans-Caspian International Transport Route (Middle Corridor), the laying of a fiber-optic communication line (FOCL) and an energy cable along the bottom of the Caspian Sea, the export of oil and uranium through Azerbaijan, and the supply of wheat from Kazakhstan to the Azerbaijani market.

First of all, today Kazakhstan is the second biggest trade partner of Azerbaijan in Central Asia after Turkmenistan, and Azerbaijan is the most important and strategic partner in the South Caucasus. Since 2020, trade turnover between the two countries has increased almost 5 times, from 109 to 529 million dollars. This is an impressive dynamic, and the sides plan to continue increasing volumes. The side is determined to expand it to $1bn in the near future.

Besides, Kazakhstan ranks in fifth place in a row for two years in the country's non-oil and gas exports, through which Baku pays special attention to diversifying its fossil-fuel-based economy. Non-fossil-fuel exports to Kazakhstan amounted to $95m in 2023. Azerbaijan’s main non-oil and gas exports to Kazakhstan are cars, special-purpose ships, iron pipes, propylene polymers, agricultural products, etc.

However, cargo transportation steps forward when the point is about the economic cooperation between the two Turkic-speaking countries. Both countries are located on the Middle Corridor, the international trade route that links Europe to the Far East. The Middle Corridor is a transportation and trade route that connects Asia and Europe, passing through several countries in the region. It is an alternative route to the traditional Northern Corridor and Southern Corridor. The Middle Corridor offers a land route that connects the eastern parts of Asia, including China, with Europe, bypassing the longer maritime routes. It is worth noting that the number of permission forms for international cargo transportation by road between Azerbaijan and Kazakhstan has increased fivefold over the past three years. However, the two countries do not intend to limit themselves to these figures and want to enhance their relations even more.

Another important point in the economic collaboration between the two countries is oil. Azerbaijan offers an alternative route to Kazakhstan to transport its rich fossil fuels to the world markets through Baku-Tbilisi-Ceyhan. The volume of Kazakh oil transported through Azerbaijani territories increases year by year.

A total of 1 million 057 thousand tons of oil were sent from Aktau port to Azerbaijan in 2023. The sides are determined to boost it to 2.2 million tons per year. Azerbaijan’s oil giant SOCAR and Kazakh KazMunayGaz (KMG) have already signed an agreement in this regard. The agreement also defines the general conditions and principles of the sale of Kazakh oil for further processing at oil refineries included in SOCAR, as well as further trade in regional and global markets.