Central Asia is becoming increasingly important to global supply chains, with three factors contributing to its growing significance: energy resources, critical and industrial minerals, and new transportation corridors connecting Europe, East Asia, and the Middle East.
The most likely geopolitical scenario emerging in Central Asia is not strategic dominance by either China or the U.S., but the sustained coexistence of competing geoeconomic models across different strategic-resource ecosystems, according to analysts.
Eka Tkeshelashvili, a Distinguished Visiting Fellow at the German Marshall Fund’s Transatlantic Democracy Working Group (TDWG), said in her commentary published by Geopolitical Intelligence Services (GIS) on Sept. 9 that the increasing importance of Central Asia in global supply chains has opened new areas of strategic competition, particularly between the U.S. and China.
“Russia’s full-scale invasion of Ukraine, intensifying United States-China strategic competition and growing concerns over economic security, industrial competitiveness and technological resilience have further reinforced Central Asia’s geoeconomic importance,” Tkeshelashvili said.
Within this strategic-resource ecosystem, competition between China and the United States is growing, with the two countries pursuing different agendas. Beijing’s strategic resource ecosystem across the region consists of multimodal infrastructure, industrial investment, logistics, financing, digital connectivity, telecommunications, manufacturing networks, and other enduring commercial ties, according to experts.
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“The result is a growing, though uneven, pattern of economic integration that both deepens regional interdependence and reshapes the balance of economic influence across Central Asia,” said Edward Lemon and Bradley Jardine in their May 5 report, titled “Reordering Central Asia: China’s Emerging Economic Hierarchy.”
Unlike China, U.S. engagement with Central Asia has emerged more recently, with the establishment of institutional, financial, and commercial foundations to support broader strategic-resource development, according to Tkeshelashvili.
The C5+1 serves as the diplomatic platform through which the U.S. coordinates with the five Central Asian states — Kazakhstan, the Kyrgyz Republic, Tajikistan, Turkmenistan, and Uzbekistan. The C5+1 Critical Minerals Dialogue was held in Astana, the Kazakh capital, on June 10 to strengthen cooperation on critical-mineral supply chains, investment, and technological development.
U.S. Special Envoy to South and Central Asia Sergio Gor said at the summit that U.S.-Central Asia economic cooperation over the past nine months has included announcements by Kazakhstan and Uzbekistan to invest more than $20 billion in the United States, while American companies are also increasingly exploring opportunities across the region, the Astana Times reported.
Tkeshelashvili said that the U.S. geoeconomic strategy in the region is increasingly being reshaped by growing concerns over supply-chain resilience, critical minerals, advanced manufacturing, strategic competition with China, and economic security. She said economic security in the region is linked to building industrial capacity, technological leadership, and secure supply chains.
She believes this has prompted the Trump administration to take an increasingly active role in promoting commercially sustainable strategic-resource sectors. These sectors will increasingly coexist with and evolve alongside the infrastructure already established by China.
Critical minerals
Of all the factors shaping Central Asia’s relevance to today’s global supply chains, critical minerals are the most strategically important emerging sector in which China has a competitive edge, according to experts. The competition is less about who accesses the minerals than about who processes and refines them and builds connections to strategically important industries.
Beijing’s processing capacity, industrial coordination, infrastructure, financing, and long-term commercial demand have already translated into a structural advantage over the U.S. in this supply chain. However, Central Asia presents a new strategic opportunity for Washington and its partners because the region’s industrial processing and advanced manufacturing capacity remain underdeveloped, according to Tkeshelashvili.
According to a report published by the Organisation for Economic Co-operation and Development (OECD) in March, Washington is not simply looking to buy minerals; it is trying to participate in exploration, extraction, processing, financing, logistics, and downstream value chains.
The U.S. backed a $1.1 billion project by California-based Cove Capital to develop two tungsten deposits south of Karaganda, Kazakhstan, in February, according to the report. The OECD describes this as the first major U.S. entry into Central Asia’s critical-raw-material sector.
Tkeshelashvili said, “Decisions made today on refining capacity, electricity supply, transport infrastructure, technology partnerships, long-term offtake agreements, and downstream industrial investment will determine whether future production is integrated primarily into China-centered value chains or more diversified ones.”
Tkeshelashvili said, “Decisions made today on refining capacity, electricity supply, transport infrastructure, technology partnerships, long-term offtake agreements, and downstream industrial investment will determine whether future production is integrated primarily into China-centered value chains or more diversified ones.”
Energy resources
The competition for energy resources in Central Asia concerns natural gas and electricity infrastructure. The region’s oil, natural gas, uranium, electricity, and energy-export infrastructure is dominated by Russia and China. However, the United States is emerging as an important diversification actor.
is emerging as an important diversification actor.
Russia’s advantage is not just its ownership of energy resources in the region, but also its legacy infrastructure, pipelines, processing facilities, transit networks, and nuclear technology. China has emerged as the principal alternative to Russia, particularly in natural gas. The most important example of China’s energy infrastructure in Central Asia is the Central Asia-China gas pipeline system, which transports Turkmen gas through Uzbekistan and Kazakhstan to China. A 2022 World Bank report describes this network as creating significant economic interdependence among Turkmenistan, Uzbekistan, and Kazakhstan.
While existing natural-gas infrastructure involving long-distance pipelines, long-term supply agreements, and integrated export networks has created path dependencies that are costly to reverse, the region’s “industrial electrification, digitalization, rising electricity demand and the energy transition” is creating new opportunities for investment and strategic partnerships. That is where the United States is gaining relevance, according to Tkeshelashvili.
“The Central Asia-China Gas Pipeline shows how infrastructure, long-term financing, contracts and established commercial ties can lock in a strategic relationship. In mature sectors like this, competition is less about building an alternative system and more about influencing how the existing one develops,” she said.
The U.S. International Development Finance Corporation (DFC) announced a strategic investment framework with Uzbekistan in February that covers critical minerals, infrastructure, and energy, with the intention of identifying mutually beneficial investments and encouraging joint investment. It also envisages a potential U.S.-Uzbekistan Joint Investment Holding Company.
“DFC sees immense economic opportunity in Uzbekistan and across Central Asia, from the growing trade along the Trans-Caspian Corridor to the booming global demand for critical minerals and regional demand for secure, reliable energy,” the DFC said in a release.
Connectivity corridors
The geoeconomics of Central Asia and the competing geoeconomic models across different strategic-resource ecosystems depend in part on the several connectivity corridors crisscrossing the region. There are existing corridors as well as emerging ones that are attracting fresh investment and multinational partnership models involving both China and the United States.
The region’s broader connectivity network consists of existing transport routes as well as emerging corridors that continue to attract investment partnerships and efforts to enhance regional connectivity. These corridors are not just about transportation infrastructure; they encompass logistics, ports, digital infrastructure, energy networks, industrial investment, trade facilitation, and regulatory coordination that together contribute to a regional economic architecture.
Existing transport corridors include the Trans-Caspian International Transport Route, also known as the Middle Corridor; the established China-Europe rail corridor through China, Kazakhstan, Russia, and Europe; the Trans-Afghan/Central Asia-South Asia corridor through Uzbekistan, Afghanistan, and Pakistan; and the Lapis Lazuli Corridor through Afghanistan, Turkmenistan, Azerbaijan, Georgia, Turkey, and Europe.
The transport corridor connecting Europe and East Asia through Central Asia, also known as the Middle Corridor or the Trans-Caspian International Transport Route, has received increased attention recently because of fresh efforts to develop, coordinate, and expand existing connections into a more integrated international trade route.
Three countries constitute the core of this “Middle Corridor”: Kazakhstan provides much of the corridor’s eastern freight capacity and mineral potential, Azerbaijan serves as the principal Caspian logistics hub, and Türkiye provides the link to European markets. The C5+1 countries committed to advancing the Middle Corridor and diversifying regional transportation routes at the September 2023 C5+1 summit in New York City, held on the sidelines of the 78th session of the United Nations General Assembly.
The Middle Corridor, along with initiatives such as the Trans-Caspian International Transport Route Investment Partnership, further strengthens regional connectivity. It is not just about “replacing established Russian or Chinese routes but in expanding commercially and politically viable alternatives that enhance regional connectivity, supply-chain resilience and strategic autonomy,” said Tkeshelashvili.
Continued coexistence of competing geo-economic models
According to analysts, the most likely geoeconomic scenario in the region is not strategic dominance by either China or the U.S., but the continued coexistence of competing geoeconomic models across different strategic-resource ecosystems.
“China is likely to preserve its advantages in sectors where decades of investment have created deeply embedded infrastructure, industrial integration, and commercial relationships, reinforced by the geographic proximity of Central Asian resources to China’s extensive processing and manufacturing ecosystem,” said Tkeshelashvili, adding that regional governments are encouraging this approach through sustained “multi-vector foreign policies.”
Regional countries will pursue “strategic autonomy” and will not align exclusively with any major power. Instead, they will diversify external partnerships by integrating finance, technology, infrastructure, and market access from multiple actors to maximize their strategic autonomy. According to Tkeshelashvili, this implies that competition will remain differentiated across sectors and will not create “exclusive geoeconomic spheres of influence” for any one power.
Competition between the U.S. and China in Central Asia will rely on long-term sectoral development rather than contests for “individual projects or resource deposits,” making it important for the U.S. to translate its strategic intent into sustained implementation.
Tkeshelashvili warned against competing global priorities diverting U.S. attention and fragmenting its engagement in the region.
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