Uzbekistan and Azerbaijan Forge Strategic Alliance with $1 Billion Trade Target and Enhanced Trans-Caspian Connectivity

Uzbekistan and Azerbaijan have significantly deepened their strategic partnership, marked by the signing of a Treaty on Eternal Friendship and a commitment to elevate bilateral trade to $1 billion by 2030, according to a statement released following high-level talks in Tashkent.

The treaty was signed during a state visit by Azerbaijani President Ilham Aliyev, who met with Uzbek President Shavkat Mirziyoyev. The visit underscored growing economic and transport cooperation between the two nations, including enhanced collaboration through the Middle Corridor initiative.

During their one-on-one discussions, the leaders also chaired the third session of the Supreme Interstate Council, a mechanism established in 2023 to oversee long-term bilateral cooperation. The two countries previously upgraded their relationship with a Treaty on Allied Relations in 2024.

Trade between the nations has shown remarkable growth, reaching $795 million in 2025—more than triple the previous year’s figure. Preliminary data indicates continued momentum, with trade totaling $144 million in the first five months of 2026, reflecting a 33% increase compared to the same period last year.

To further strengthen economic ties, the two governments launched several Azerbaijani-backed ventures in sectors such as construction, education, energy, agriculture, and finance. Among these projects are a gypsum processing plant, two STEAM schools, five SOCAR fuel stations, and a silver-bearing ore processing facility. Additionally, Azerbaijan’s state-owned ABB Bank is finalizing plans to acquire a 51% stake in Uzbekistan’s Davr Bank, pending regulatory approval.

In the energy sector, both sides reported progress in joint oil and gas exploration efforts, with plans to initiate production drilling possibly commencing next year, contingent on favorable exploration outcomes.

A major infrastructure announcement came with the unveiling of “Sea Breeze Uzbekistan,” a large-scale tourism and residential development at the Charvak Reservoir. The $5 billion project, spearheaded by Azerbaijan’s Agalarov Development, spans 577 hectares and recently underwent an environmental impact review to ensure sustainable development practices.

The leaders emphasized strengthened regional connectivity, particularly through the Trans-Caspian transport routes. Transit freight volumes between the countries reached 1.4 million tonnes in 2025, rising to 675,000 tonnes in the first half of 2026—an increase of 12.2% year-over-year.

President Mirziyoyev also highlighted plans to establish a joint Caspian Sea fleet, reinforcing maritime cooperation. Meanwhile, the China-Kyrgyzstan-Uzbekistan railway project was cited as a potential connector to broader Eurasian transport networks.

The European Union continues to support regional integration via its Global Gateway initiative, which aims to enhance transport links between Europe and Central Asia. Over €10 billion in transport investments for the region were announced in 2024, complemented by €2 billion in funding secured in June through new agreements involving international financial institutions.

A green energy partnership is also taking shape, with Azerbaijan, Kazakhstan, and Uzbekistan working together on a renewable energy corridor that could transmit clean power across the Caspian Sea to European markets.

Cultural and diplomatic cooperation received formal recognition through agreements on pensions, tourism, judicial collaboration, and municipal partnerships linking cities such as Urgench with Khankendi and Nakhchivan, and Bukhara with Lachin. These developments coincide with Uzbekistan and Azerbaijan preparing to co-host the 2027 FIFA U-20 World Cup, for which a joint program titled “Two Countries – One Championship” was launched.

Among symbolic gestures, the leaders inaugurated the new campus of the Nizami National Pedagogical University in New Tashkent and initiated construction on Azerbaijan Park, mirroring an upcoming Uzbekistan Park in Baku. The visit concluded with the exchange of national honors, recognizing mutual contributions to bilateral friendship.

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