Clean energy powers boost to UAE and Kyrgyzstan trade

Wam

• Masdar support the Kyrgyz Republic’s clean energy objectives
• Country blessed with abundant solar resources
• Tourism between countries also growing as number of flights increases

Abu Dhabi’s Masdar is looking to develop a pipeline of renewable energy projects in Kyrgyzstan as part of the former Soviet republic’s plans to reduce its greenhouse gas emissions by as much as 44 percent by 2030.

A deal signed with the Ministry of Energy of the Kyrgyz Republic last month will begin with a 200mw solar photovoltaic plant which is scheduled to go online in 2026.

Ibraev Taalaibek Omukeevich, the country’s minister of energy, said the Kyrgyz Republic faces challenges meeting the significant demand for electricity from all categories of consumers with its existing resources. 

“At the same time, Kyrgyzstan has good solar energy potential. The successful implementation of projects to develop solar power plants of up to 1gw capacity will help to ensure our nation’s energy security.”

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Mohamed Jamel Al Ramahi, CEO of Masdar, said: “We’ll leverage our expertise to support the Kyrgyz Republic’s clean energy objectives.

“Kyrgyzstan is blessed with abundant solar resources, and we see this 200mw plant being the first of a number of projects that will support the nation’s goals on emissions reductions, while increasing clean energy access and security.”

Kyrgyzstan, which aims to achieve carbon neutrality by 2050, already generates around 90 percent of its electricity from clean energy resources – almost exclusively from ageing hydropower plants. 

The new agreement builds upon a memorandum of understanding signed by the two sides in April last year and will see Masdar explore and invest in renewable energy projects such as solar and hydropower.

With a goal of achieving 100gw renewable energy capacity and green hydrogen production of 1 million tonnes per annum annually by 2030, Masdar plans to spearhead the UAE’s Net Zero by 2050 initiative.

The agreement comes as the governments of the UAE and Kyrgyzstan seek to strengthen economic cooperation in sectors including agriculture, food security, information technology, tourism, Islamic finance, banking, logistics and education as well as clean energy.

Abdullah bin Touq Al Marri, the UAE’s minister of economy, said that the UAE was Kyrgyzstan’s leading trade partner in the GCC region last year, with non-oil trade totalling more than AED3.67 billion over the first nine months in 2022, an increase of 66 percent. 

Kyrgyzstan’s major exports include gold, cotton, wool, garments, meat, mercury, uranium, electricity, machinery and shoes. Major imports include oil and gas, machinery and equipment, chemicals and foodstuffs.

Bishkek, the capital city, is set to host a business meeting of entrepreneurs from Kyrgyzstan and the UAE on March 20, according to the press service of the National Investment Agency of Kyrgyzstan.

Kyrgyzstan will be visited by 20 UAE-based businessmen who are interested in importing food products, as well as providing logistics services and creating joint ventures for the processing of agricultural and medical products, it said.

In December, the second edition of the joint economic committee between the two countries took place in Abu Dhabi, jointly chaired by Al Marri and Akylbek Japarov, chairman of the Cabinet of Ministers of Kyrgyzstan.

The meetings witnessed the signing of several memoranda of understanding in industry, renewable energy and the food sector. 

Tourism between UAE and Kyrgyzstan

Tourism between the two countries is also growing as the number of flights increases. More than 16,000 Emirati tourists visited Kyrgyzstan in 2021, said Japarov. 

In November, low cost carrier Flydubai launched flights to Osh in Kyrgyzstan with a twice-weekly service, becoming the first UAE carrier to operate direct flights from Dubai. Osh became the second destination for Flydubai in Kyrgyzstan after Bishkek.

The two countries have also agreed to establish new action plans to increase mutual foreign direct investments, he added. 

AD Ports Group recently signed two major agreements with the government of Kyrgyzstan to promote trade and strengthen economic ties with the Central Asian nation.

Under the first agreement, the Ministry of Economy and Commerce entered negotiations with AD Ports Group to secure more than 300,000 sq m of land within the Khalifa Economic Zone Abu Dhabi to develop and operate a logistics hub and customs area.

Under the second deal, Maqta Gateway will develop a customs and border management solution, infrastructure and other digital services for deployment in Kyrgyzstan.

Mohamed Juma Al Shamisi, managing director and group CEO, AD Ports Group, said the company sees Central Asia as a “vital market for growth and development”. 

The Kyrgyz economy has proved more resilient than expected to the spillovers of the war in Ukraine and sanctions on Russia. 

According to the World Bank, real GDP grew 7.7 percent during January-July 2022, supported by industry, agriculture, construction and services. 

Growth was driven by domestic demand which in turn was supported by solid remittance inflows from Russia.

GDP growth is expected to hit 4 percent for 2022 but the current account deficit is projected to remain high at about 13 percent of GDP, reflecting the fall in gold exports. 

The poverty rate is expected to increase to 25.5 percent in 2022 as high inflation remains the most immediate concern for the welfare of the population.