As global demand for critical resources needed to power the green transition soars, Central Asia has become a focal point for geopolitical competition, with the European Union (EU) intensifying its efforts to secure access to these vital materials, according to Eldaniz Gusseinov, a columnist for Daryo and a Non-Resident Research Fellow at the Haydar Aliyev Center for Eurasian Studies.
Despite being a major trading partner and the leading investor in Kazakhstan, the EU's presence in the region is still overshadowed by China's dominance. The challenge for Brussels is not just securing investments, but doing so in a way that ensures sustainable development and avoids overreliance on Beijing.
China has invested over $63bn in Central Asia, largely focused on sectors like mining and infrastructure. In contrast, European investments in the region, particularly in the transport sector, total around €7bn. Many experts and businesses in the region stress that while the EU is a key player, its pace of investment must accelerate to keep up with China’s expansive presence.
The race for Central Asia's resources is heating up, with the US and China leading the charge in developing new deposits and building production chains. For Central Asian countries, access to foreign capital is important, but so is the transfer of advanced technologies and know-how.
European businesses, with their emphasis on sustainability standards, offer a unique advantage. The region hopes these investments will not only boost the economy but also help mitigate environmental and social tensions, which have often accompanied large-scale resource extraction.
Central Asia’s importance in the global supply chain cannot be overstated. The EU, keen to diversify its sources of critical resources and reduce dependency on China, is increasingly focusing on this region. Brussels is positioning itself as a reliable partner, offering transparent, sustainable, and mutually beneficial investment solutions. This approach contrasts with the more transactional nature of China’s investments, which often come with fewer strings attached.
For the EU, the challenge now is to act quickly and decisively. Central Asia’s countries need more than just capital; they require infrastructure development, technology transfer, and enhanced human resource capabilities to secure long-term, sustainable growth. The region has the potential to evolve beyond its role as a raw materials supplier to become a key player in a diversified, responsible global supply chain for critical resources.
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