New Sanctions: Regional Expert Discusses Impact On Central Asia

Temur Umarov, a regional analyst and expert at the Carnegie Berlin Center for Russian and Eurasian Studies, has discussed how the latest package of anti-Russian sanctions may affect Kazakhstan and its neighbors, Orda.kz reports.

EU Sanctions Impact

Speaking on Carnegie Politika’s YouTube platform, Umarov reflected on the impact of the EU’s 19th sanctions package on Central Asian economies.

Since 2022, Central Asian states have been adapting to sanctions regimes and working closely with Brussels to ensure secondary sanctions don't impact their economies. We've seen numerous events, bilateral and multilateral meetings between representatives of the EU and Central Asian countries. These meetings continue today. It appears that secondary sanctions coexist alongside the reality of improving relations between the region's countries and Europe. However, Central Asian countries have always understood the risks of continuing to do business with Russia using their usual methods. And they tried to convince their European partners that secondary sanctions would primarily harm the economic stability of the Central Asian countries themselves,
 Temur Umarov believes.

The EU understands that the period of all this talk by Central Asian countries about adapting to sanctions regimes and doing everything possible to prevent Russia from using them as a gateway to a world without sanctions is coming to an end. EU countries are no longer buying this rhetoric, in which the Central Asian countries try so hard to appear trapped in a hopeless situation. Therefore, the EU is trying to offer some kind of alternative to the Central Asian countries, including through its Global Gateway project, which promises to invest heavily and open new avenues of development and economic cooperation for the countries of the region through the South Caucasus with the European Union.

Energy Risks

According to Umarov, Kazakhstan and other regional states will continue to face difficulties due to their deep economic ties with Russia. The energy sector remains the most vulnerable.

We need to separately examine the impact of EU sanctions against Russian companies, particularly Lukoil, on the situation in Central Asian countries and the extent to which these Russian companies used their subsidiaries in Central Asia to circumvent the sanctions. For now, the only scenario that comes to mind is that the deterioration of these companies' operations will negatively impact the energy stability of the region's countries.

The expert added that the EU and the U.S. still possess many tools to pressure countries that help Russia evade restrictions — Central Asia included. Whether these tools will be used, he said, depends on the state of relations between Moscow and Washington, and on Donald Trump’s stance toward the war in Ukraine.

Umarov also noted that drone attacks on Russian oil infrastructure are already indirectly affecting Central Asia.

First and foremost, of course, Kazakhstan is experiencing problems purely logistical and in terms of infrastructure. The Trans-Caspian oil pipeline and various facilities along its route were attacked by Ukrainian drones, and this is impacting not only oil supplies from Kazakhstan to Europe but also the country's overall economic stability. For Kazakhstan, the oil industry accounts for, if not half, then at least around 40% of the state budget — a significant share. And any problem in this area automatically becomes a national issue that requires immediate solutions. This is most likely why Qasym-Jomart Toqayev held a personal meeting with Volodymyr Zelenskyy on the sidelines of the UN General Assembly in New York. This was their first meeting since the beginning of the war, and Toqayev was the first president from a Central Asian country to hold such a meeting with Zelenskyy. The two leaders likely discussed these attacks and their impact on Kazakhstan's economic well-being,
 the expert believes.

Risks For Kyrgyzstan And Tajikistan

According to Umarov, Kyrgyzstan and Tajikistan, which import up to 80% of their fuel from Russia, may face shortages.

In Kyrgyzstan, the Ministry of Industry has already announced that the country's gasoline reserves will last for the next month, but after that, a shortage will occur, requiring the search for additional markets from which to import petroleum products. Kazakhstan is being looked at first, but it has significant domestic consumption.

He warned that fuel shortages could become a serious challenge for the entire region, potentially leading to social unrest.

Background

On October 23, U.S. President Donald Trump announced new sanctions on Rosneft and Lukoil and said he would not meet Vladimir Putin in Budapest. The European Union also introduced its 19th package of sanctions against Russia that same day, which included the Kazakhstan-based subsidiary of VTB Bank.

Original Author: Anastasia Prilepskaya