EDB notes record investment activity in Central Asia

The investment surge has been a key driver of growth in the region where the Eurasian Development Bank operates. This is stated in the latest macroeconomic review of the seven participating countries. In most countries, fixed capital investment growth remains in double digits, which helps to offset external risks and maintain high economic activity.

In January-July, the aggregate GDP of the EDB countries increased by 2.1% year-on-year, following 4.5% in 2024. Economic growth is largely driven by domestic sources.

Kyrgyzstan has become one of the leaders in terms of growth rates. The economy grew by 11.5% over the year, and investments increased by more than 30%. It was investment activity that gave impetus to the development of industry, transport and construction.

• Kazakhstan accelerated GDP growth to 6.3%, and investments in fixed capital increased by 16.1%. The country continues to implement state programmes to stimulate capital investment.
• Tajikistan showed economic growth of 8.1%, with investment increasing by 21.7% — a record level in recent years.
• Armenia grew by 7%, and investment increased by more than 25%, which, combined with rapid growth in construction and the IT sector, ensures stable growth for the country.
• Uzbekistan continues to grow steadily at 7.2%, supported by consumption and exports.

At the same time, the dynamics in Russia and Belarus are noticeably more modest. GDP increased by 1.1% and 1.3%, respectively. However, Belarus was able to record a 13.6% increase in investment, while in Russia, domestic demand and high interest rates are slowing down activity.

The picture for inflation remains mixed. In Armenia and Tajikistan, prices remain within target ranges, while Belarus, Kazakhstan and Kyrgyzstan have seen an acceleration in price growth. In response, regulators in Minsk and Bishkek raised refinancing rates to 7.75% and 9.25%.

The Bank of Russia, on the contrary, continues its cycle of rate cuts, bringing the rate down to 17%, while the National Bank of Tajikistan has lowered its rate to 7.75%, taking advantage of the stable inflationary environment.

"The EDB member countries continue to actively create new sources of growth. Investment growth rates in most countries (Armenia, Belarus, Kazakhstan, Kyrgyzstan and Tajikistan) remain in double digits. Investment growth is driven by both domestic sources and external financing, including FDI. This indicates the high adaptability of the countries in the region to the new realities of the global economy," said EDB Chief Economist Evgeny Vinokurov.