UAE Steps Up Investment in Central Asia's Wealthiest Economy

The United Arab Emirates (UAE) and Kazakhstan have signed an intergovernmental agreement, under which the two countries will implement $6 billion worth of investment projects in priority sectors of the economy.

The document aimed to establish a long-term strategic partnership between the countries was signed as part of Kazakh Prime Minister Askar Mamin’s visit to Abu Dhabi last week. 

While in Abu Dhabi, Mamin met with Sheikh Mansour bin Zayed Al Nahyan, Deputy Prime Minister of the United Arab Emirates and Minister for Presidential Affairs, as well as heads of the region’s largest holding companies.

After the talks, the sides agreed that the Abu Dhabi Developmental Holding Company (ADQ) would become Kazakhstan’s primary partner in implementing the agreement, covering energy, agribusiness, transportation, logistics, pharmaceutics, and finances.

ADQ, whose assets are estimated at $110 billion, is considered the UAE’s third-biggest sovereign wealth fund with investments in more than 90 local and international companies. 

Meanwhile, Kazakhstan’s Samruk-Kazyna National Wealth Fund and ADQ will establish a joint energy holding for renewable and conventional energy development under the intergovernmental agreement. The sides intend to implement joint projects for building solar, wind, and hydropower stations with a total power generation capacity of five gigawatts (GW).

Additionally, a $100-million venture fund between Kazyna Capital Management and ADQ will start a new chapter of Kazakhstan’s cooperation with the UAE. The all-new venture will reportedly finance joint start-up projects in IT, fintech, agrotech, B2B and B2C, telecommunications, food production technologies, platform solutions, and digital transformation.

SK-Pharmacia, a distributor of medicines in Kazakhstan, will cooperate with the UAE’s leading healthcare supply chain Rafed to jointly develop Central Asian country’s pharmaceutical industry.

The parties to the agreement also focused on cooperation with the Sembol company and Abu Dhabi Fund for Development (ADFD) to build a new tourist facility in one of Kazakhstan’s most scenic places — Katon Karagay valley.

The UAE is currently involved in 11 large investment projects in Kazakhstan, worth $3.5 billion, according to government data. The amount of trade between the two countries exceeded $347 million in the first eight months of 2020.

At the same time, following its policy aimed to dominate ports, Dubai Ports World bought a 49 percent stake in the Aktau special economic zone on Kazakhstan’s Caspian Sea coast and a 51 percent stake in the Khorgos special economic zone, a major transportation hub on the Kazakhstan-China border.