The Middle Corridor trade route is fueling the warehousing boom in Central Asia

• The lack of storage space in Central Asia has driven up rental costs, particularly in Uzbekistan and Kazakhstan.
• The storage crisis is fueled by the increase in commercial activity along the Middle Corridor route and the B5+1 initiative.
• Although the shortage has caused a construction boom, there are concerns about potential oversupply and delayed infrastructure development.

Central Asia these days is frequently associated with scarcity in a bad way – scarcity of heat and electricityFROM jobs and, perhaps most alarmingly, of water. But there is at least one deficit in Central Asia that can be seen as a favorable development – ​​a lack of storage space.

Lack of available storage space means demand is high and trade is expanding. It also means that storage costs in Uzbekistan and Kazakhstan are higher than in Dubai and most other seaport transit hubs. A report published by the Uzdaily outlet, citing a local logistics expert, notes that the average rental rate for storage exceeds $150 per square meter per year in Tashkent and Almaty. Meanwhile, rates in Kyrgyzstan average around $114 per square meter per year, a cost comparable to that found in many European Union locations.

Interest in expanding the so-called Middle Corridor the trade route connecting Asia and Europe via Central Asia has grown rapidly since the Kremlin launched its unprovoked attack on Ukraine in 2022: sanctions have greatly diminished interest in Russia’s Northern Corridor trade route. A US-sponsored trade framework for Central Asia called B5+1help generate a commercial boost in the region and potentially foreign investment.

The lack of storage is encouraging a construction boom. But the Uzdaily report says the rush to build risks creating excess. It also notes that construction of associated infrastructure, such as road improvements, currently lags behind efforts to create more storage space.

Of Eurasianet.org

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