FIRST IN BAKU

In recent years, there has been an intensive cooperation between the countries of Central Asia, the South Caucasus and the Middle East. This is not accidental. Complex political and economic processes around the world force regional actors to find other types of interaction or use existing platforms to build up trade and economic ties, to search for new forms of cooperation. Along with the organisations of Turkic states and economic cooperation, the UN SPECA programme aims to assist the member states in economic development, cooperation and integration into the economies of Europe and Asia.

The organisation currently includes Afghanistan, Azerbaijan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. The programme is part of the UN initiatives implemented in close coordination with other specialized agencies, such as the Economic Commission for Europe (UNECE) and the UN Economic and Social Commission for Asia and the Pacific.

Historical background of regional partnership

SPECA has been operational for 25 years. But the leaders of member states have never gathered for a summit during this period. It is no surprise that many observers regarded the first SPECA forum in Baku as a truly historic event.

Personal authority of President Ilham Aliyev, his friendly ties with the leaders of regional states, as well as Azerbaijan's high reputation in regional and international arenas made it possible to hold the summit in Baku.

The programme was first announced in 1998 at the forum in Tashkent. It was an important platform for the member states to implement their national programmes to integrate into the system of international economic relations. It was the most urgent issue for the states of the region at that time. The situation after the collapse of the Soviet Union and disruption of previous economic ties worsened due to the poorly developed industrial and social infrastructure, unsatisfactory quality of products and low labour productivity. The demand for industrial products was at the record low both abroad and in these countries, while the significant volumes of import had a negative impact on trade balance.

Over the past years, UN specialists together with the governments of the Central Asian states have developed and proposed various programmes in a wide range of areas. They have provided support to the economies of regional member states to overcome the crisis and have made it possible to develop an effective platform for co-operation between them and the UN.

SPECA has focused on developing a strategy for cooperation in priority areas such as economic recovery from the COVID-19 pandemic, economic transformation and sustainable growth, sustainable energy transition, digital transformation, women's empowerment, etc.

Week of extensive dialogue

Azerbaijan's chairmanship of SPECA has significantly contributed to the development of the programme. In 2023, SPECA celebrated its 25th anniversary with great success. Thus, the SPECA Days were held in Baku on November 20-24, including the economic forum Transforming the SPECA Region into a Connectivity Hub with Global Outreach and exhibition Regional Cooperation for Sustainable Development. At the end of these events, the leaders of member states held a summit.

During the economic forum, specialists discussed numerous issues of mutual interest, including Azerbaijan's initiatives as a transport and logistics hub.

Representatives from Azerbaijan, Kazakhstan, Uzbekistan, Turkmenistan, Kyrgyzstan and Tajikistan exchanged ideas on developing partnerships in traditional and renewable energy, transport and other areas. There were guests from Georgia, Hungary, and the Gulf Cooperation Council, indicating the growing importance of the region for external players.

At the forum, Azerbaijani Minister of Economy, Mikail Jabbarov, said that Baku has increased trade turnover with SPECA member states by 3.6 times, or up to $1.3b, by 2022. During January-October 2023, the volume of trade turnover reached $1.2b, which is 16% more than in the same period of 2022.

Transport sector shows greater interest to SPECA member states given the changing geography of routes through their territories due to wars and conflicts in Eurasia. Landlocked countries, however, attempt to join collective efforts to create new routes to access global markets.

The Central Asian region, which has limited access to Western markets due to its geographical location, is making efforts to diversify economically by supporting various ambitious projects, including the Chinese Belt Road Initiative (BRI) and the Trans-Caspian International Transport Route (TCITR), also known as the Middle Corridor.

SPECA and the Middle Corridor

The Middle Corridor is quite cost-effective and fast compared to the Northern Corridor, which, due to sanctions imposed on Russia, cannot cope with cargo turnover from China to Europe. The Middle Corridor not only shortens the distance by 2,000 kilometres but is also safer. The route includes about 4,250 kilometres of rail and 500 kilometres of maritime routes. The destination point of the corridor is the European market via Türkiye and the Black Sea. In addition, it passes through areas with more favourable climatic conditions and is shorter by 15 days compared to the sea route. It has great potential for transport in Asia, so that cargoes can reach the Middle East, North Africa and the Mediterranean area by integrating port connections in Türkiye.

If used effectively, the Middle Corridor can make the countries of the South Caucasus and Central Asia to benefit from trade between China and Europe, which is estimated at $600b annually. In particular, the establishment of logistics centres and free trade zones in the ports of Azerbaijan, Kazakhstan and Turkmenistan will contribute to the development and deepening of trans-Caspian cooperation.

Azerbaijan and Kazakhstan are important links between the East and the West, that is, between China and Europe. The strategic location of these countries provides them with exceptional transit opportunities, facilitating the connectivity of the East-West and North-South transport projects.

In June 2023, the railway authorities of Kazakhstan, Azerbaijan and Georgia agreed to unify tariffs and create a joint logistics company. In autumn, a decision to create a single operator was officially adopted in Tbilisi.

Landlocked Uzbekistan is also trying to integrate its national transport networks into the Middle Corridor. The country's trade suffers from disrupted supply chains and increased costs because of its landlocked position and dependency on free transport routes. In addition, the growing East-West connectivity creates conditions for the diversification of Uzbekistan's exports.

Regional partnership prospects

These and other related topics were discussed in detail at the summit with the participation of presidents Ilham Aliyev (Azerbaijan), Sadyr Zhaparov (Kyrgyzstan), Emomali Rahmon (Tajikistan), Shavkat Mirziyoyev (Uzbekistan), prime ministers Irakli Garibashvili (Georgia), Viktor Orban (Hungary), and Vice-Premier of Turkmenistan Khojamyrat Geldimiradov. The meeting was also attended by Executive Secretaries of the Economic Commission for Europe Tatiana Molchan and the UN Economic and Social Commission for Asia and the Pacific Armida Salsia Alishahban, as well as Secretary General of the Cooperation Council for the Arab States of the Persian Gulf Jasim Muhammad Al-Budaywi.

In his keynote address, President Ilham Aliyev said that the forum would make a significant contribution to the development of business relations between the countries, while the exhibition organised at the Baku Expo Centre clearly demonstrated the development dynamics of the represented countries. "Azerbaijan and Central Asian countries are connected by centuries-old historical and cultural ties. Azerbaijan and Central Asia are a single historical, cultural and geopolitical space of growing strategic importance. In September, it was the first time I was invited as a guest of honour to the Summit of Heads of State of Central Asia held in Dushanbe. Once again, I express my gratitude for that invitation. I regard this summit as a logical continuation of the Dushanbe meeting," Azerbaijani leader said.

At the end of the forum, delegates adopted a roadmap to digitise the multimodal data and document exchange along the TCITR. It will help ensure seamless real-time information exchange and improve transport efficiency using UN digital standards as well as legal instruments in SPECA member states.

Among other things, the roadmap will make it possible to use digital standards to ensure data interoperability across different modes of transport and the introduction of intelligent transport solutions, including the international eTIR system based on the UNECE Convention.

One of the key issues for the region is energy connectivity and the transition to greener and more sustainable energy sources.

The session also discussed the water-energy nexus and the impacts of climate change. Other discussed topics included the need for closer partnership on transboundary waters, migration challenges due to climate change and the importance of co-operation between the cities were addressed.

The Baku Declaration adopted at the end of the summit identified the key priority areas of partnership for the coming years. In particular, it expresses the determination of signatories to support the ongoing institutionalisation of SPECA, to strengthen digitalisation, to promote green transformation of transit routes, and to facilitate trade and transport. It also reaffirms the willingness of the member states to provide SPECA with an appropriate financial mechanism to implement the decisions, such as the establishment of the Multifunctional Trust Fund under the auspices of the UN.

In general, common long-term interests of Azerbaijan and the Central Asian countries contribute to further consolidation of efforts to address very important issues on the current agenda. The Baku summit showed readiness to overcome existing problems by strengthening co-operation. This process is now quite active and will intensify in the future due to the decision taken at the event.