EFSD Economists Assess Central Asia’s Participation in Global Value Chains

The study finds that the region still exports mainly raw materials, leaving most of the technological rent with the countries that process them further. Integration among the region’s own economies remains very weak.

October 15, 2026. EFSD economists have published a working paper on Central Asia’s participation in global value chains (GVCs). It examines how Kazakhstan, the Kyrgyz Republic, Tajikistan and Uzbekistan have integrated into GVCs, and how that integration has evolved, over the periods for which comparable data are available.

Participation in GVCs is one of the main drivers of productivity growth and technological upgrading in developing economies. Central Asia’s exports, however, remain dominated by raw materials and goods with little processing. Most of the value added and technological rent therefore goes to the countries that handle the later stages of production. This holds back productivity and leaves the region exposed to swings in global commodity markets.

To identify integration patterns, the authors decomposed gross exports by source of value added using the Koopman-Wang-Wei method. They also drew on GVC participation indices and on measures of production chain length and distance to final demand, which show how technologically complex production is across sectors.

The analysis points to four distinct models:

• Kazakhstan is a major supplier of raw materials, including oil, ores and metals. Most of its domestic value added is embedded in intermediate rather than final exports, and its goods go through several stages of processing abroad.
• The Kyrgyz Republic has the most open export sector in the region but depends heavily on imported inputs, reflecting its role as a regional transit and logistics hub.
• Tajikistan remains at the start of production chains as a raw materials supplier. Limited processing capacity and high transit and logistics costs stand in the way of a move into higher-value products.
• Uzbekistan is building a more balanced industrial base, importing more technology and capital goods to support automotive, machinery and other high-tech manufacturing.

The region sells mainly to external markets, notably the European Union, China and Switzerland, while the foreign value added in its exports comes largely from Russia and China. Ties among the Central Asian economies themselves are thin. Regional neighbors account for only a small share of the value added in each country’s exports, and there are virtually no horizontal production links between the Kyrgyz Republic and Tajikistan.

Building on these findings, the authors outline several policy directions: deepening regional cooperation to build regional value chains; moving gradually from raw material exports toward higher-value products, in line with each country’s specialization; attracting foreign direct investment (FDI) on terms that encourage local processing and technology transfer; and harmonizing regulatory regimes and lowering transaction costs in trade among the countries of the region.