The Organization of Turkic States (OTS), comprising Azerbaijan, Türkiye, Kazakhstan, Uzbekistan, Kyrgyzstan, and (as observers) Turkmenistan, Hungary and the Turkish Republic of Northern Cyprus (TRNC), has rapidly intensified economic cooperation in recent years. Together, these countries represent nearly 180 million people and a combined GDP exceeding $2 trillion. Their strategic geography spans Central Asia to Anatolia, positioning the bloc as a natural bridge between East and West. Despite this potential, intra-OTS trade remains modest, accounting for only around 5% of the group’s $860 billion external trade, approximately $42 billion, up from just 3% a few years ago. Yet this low baseline also underscores significant room for expansion. As OTS Secretary-General Kubanychbek Omuraliev has noted, the upward trend is promising: intra-bloc trade has nearly doubled its share in recent years, and the OTS aims to increase it to 10% in the near future. To realize this goal, member states have launched a range of initiatives, including cross-border trade facilitation, strategic infrastructure projects, and new investment mechanisms designed to deepen economic integration and unlock the region’s full potential.
Trade volumes among Turkic states have grown significantly since 2018, even if from a low base. Intra-OTS trade is now estimated at around $42-57 billion annually, roughly 5-7% of members’ combined trade turnover, up from about 3% five years ago. All member countries have seen double-digit trade growth with their Turkic partners. For example, Kyrgyzstan’s trade turnover with OTS members expanded by over 60% in recent years (exports up 54.6%, imports up 66%). Azerbaijan’s trade with fellow Turkic states jumped 70% in one year, from $5.3 billion to $7.17 billion, buoyed largely by surging energy exports to Türkiye. Uzbekistan, after joining the OTS in 2019 and liberalizing its economy, has rapidly increased commerce with its Turkic neighbors; by 2024, Kazakhstan had become one of Uzbekistan’s top three trade partners (6.5% of Uzbek trade), and Türkiye reached the top five (4.4%). Türkiye’s own trade with Central Asia hit $12.3 billion in 2022 (about 2% of Türkiye’s total trade) and continues to rise. Notably, Türkiye-Azerbaijan trade boomed to $7.5 billion in 2023 (up from $5.8 billion in 2022), fulfilling half of the two countries’ ambitious $15 billion bilateral trade target. These trends indicate that intra-OTS commerce is becoming a more significant driver of growth for each member’s economy, even if most trade still occurs with outside partners (e.g., China, Russia, and the EU).
Turkish firms have dramatically increased their presence across Central Asia, the number of Turkish investment projects in the region nearly doubled (from 99 to 172 projects) between 2016 and 2023, in sectors ranging from textiles and construction to mining. Türkiye is now among the largest sources of foreign direct investment in Uzbekistan, Kazakhstan, and Kyrgyzstan, bringing capital and technology into manufacturing and infrastructure projects. Conversely, several Turkic states are investing in each other’s economies: Azerbaijan’s state oil company SOCAR has major investments in Türkiye (such as the STAR refinery and TANAP pipeline), Kazakhstan’s sovereign fund has acquired stakes in Turkish firms, and joint sovereign investment ventures are emerging. Azerbaijan and Uzbekistan established a bilateral investment council with $500 million in capital to finance high-tech joint projects. Even observers contribute: Hungary joined the new Turkic Investment Fund with a $100 million stake, and Hungarian oil company MOL acquired a share in a major Kazakh gas field. These flows of intra-bloc investment support industrial development, energy production, and job creation across member states.
Critically, the past five years have seen the OTS move from rhetoric to action on economic integration. In 2021, the Turkic Council was reconstituted as the Organization of Turkic States, adopting a broad vision for cooperation through the document of Turkic World Vision 2040. Since then, high-level summits and ministerial meetings have yielded concrete agreements. All OTS members recognize that eliminating trade barriers is key to boosting intra-bloc commerce. Negotiations are underway for a multilateral Free Trade and Services Agreement to reduce tariffs and open markets among the Turkic states. In the interim, countries have struck bilateral deals, notably the Azerbaijan-Türkiye preferential trade agreement (PTA) that took effect in 2021, cutting duties on dozens of agricultural and industrial goods. This PTA has already eased market access (Türkiye is Azerbaijan’s second-largest trading partner, and non-oil exports from Azerbaijan to Türkiye rose 10% last year under the deal). Similar arrangements are being explored between Türkiye and Uzbekistan. Alongside tariffs, the OTS is targeting regulatory and logistical barriers. In 2022, member states signed agreements on “combined freight transportation” and a “Simplified Customs Corridor” to streamline the movement of goods across borders. In October 2022 (Tashkent) and July 2024 (Shusha), OTS ministers signed memoranda to adopt e-permit systems, simplifying permit issuance for international road transport. Moreover, a January 2025 meeting in Baku resulted in an eTIR implementation roadmap, targeting full deployment across all member states by 2025. They are jointly implementing digital systems, such as eTIR, ePermit, and eCMR, to enable electronic transit documents and pre-clearance of shipments, which speeds up border crossings and reduces compliance costs. These measures, supported by the UN Economic Commission for Europe and IRU, aim to create seamless trade corridors across the region. Early results are promising; pilot “digital TIR” projects have reduced customs processing times and decreased truck queues at key checkpoints.
Improved connectivity is the backbone of Turkic economic integration. The OTS countries have prioritized joint infrastructure to link their markets and connect to global supply chains. The flagship is the Trans-Caspian International Transport Corridor, known as the Middle Corridor, which runs from China through Central Asia and the South Caucasus to Türkiye and Europe. Historically part of the Silk Road, this route offers a strategic alternative to northern routes via Russia. It is about 2,000 km shorter than the Trans-Siberian corridor and three times faster than sea transport, enabling goods to move from China to Europe in as little as 15 days. To capitalize on this advantage, Turkic states are investing heavily in the Middle Corridor’s capacity. Kazakhstan has adopted a comprehensive plan to expand its Caspian seaports (Aktau and Kuryk) and related rail links, aiming to boost port throughput by 50% and triple container traffic by 2028. Azerbaijan has modernized the Baku Port and upgraded the Baku-Tbilisi-Kars railway, which directly connects the Caucasus to eastern Türkiye. Thanks to these efforts, trans-Caspian freight volumes are on track to triple to 11 million tons by 2030.
Another game-changing project is the China–Kyrgyzstan–Uzbekistan railway, a long-envisioned rail link whose groundbreaking finally took place in 2024. This 523 km line from Kashgar (China) through Kyrgyzstan to Uzbekistan will include 27 tunnels through the Tian Shan mountains and move up to 15 million tons of cargo annually once completed. For the first time, Kyrgyzstan will have a direct railway connection to regional networks, dramatically reducing transit distances and costs for trade between China, Central Asia, and Türkiye. The Middle Corridor will also benefit from proposed feeder routes, such as a southern Trans-Caspian route via Turkmenistan. Leaders have discussed a Turkmenistan-Uzbekistan transport corridor feeding into Middle-Corridor-related ports, which would complement the Kazakhstan route and add redundancy. In the energy sphere, Turkic cooperation is likewise creating infrastructure. The Trans-Anatolian Natural Gas Pipeline (TANAP), completed in 2018, now carries Azerbaijani gas across Türkiye (and onwards to Europe), solidifying an East-West energy corridor through the OTS region. Member states are also partnering on innovative projects like the planned Black Sea undersea electricity cable to carry Azerbaijani renewable power via Georgia to Hungary (1,100 km, expected by 2028), a venture that links Turkic resources to European markets and diversifies energy routes.
Recognizing the need for dedicated financing, OTS members established the Turkic Investment Fund (TIF) in 2023 with an authorized capital of $1 billion (initial subscribed capital of $500 million). This multilateral fund, the first of its kind for the Turkic bloc, is designed to finance joint projects that promote internal trade and investment. It will begin funding major initiatives by January 2025, focusing on infrastructure, industrial co-investments, and SME support across member states. All full members are shareholders, and even observer Hungary has contributed $100 million, underscoring confidence in the fund. In parallel, the private sector is being mobilized through the Union of Chambers and Commodity Exchanges of Turkic States, uniting over 2 million companies to foster business matchmaking and trade fairs. The OTS has also launched a Green Finance Council and is planning a Council of Central Banks at Kazakhstan’s proposal, to coordinate sustainable investment and monetary policy among members. These institutions can pave the way for initiatives like cross-border lending facilities, currency swap agreements, and harmonized financial regulations to facilitate commerce. Furthermore, at the 2024 Bishkek summit, the OTS signed a Digital Economy Partnership Agreement, committing members to cooperate on digital trade platforms, e-commerce regulations, and fintech innovation. By improving digital connectivity and finance, the Turkic states aim to reduce transaction costs and enable even small businesses to engage in cross-border trade.
Several high-profile joint projects highlight the tangible economic impact of Turkic cooperation. In Azerbaijan’s newly liberated Karabakh region, Turkish companies are actively involved in rebuilding highways, power plants, and smart cities, a testament to how political solidarity translates into investment. Kazakh and Turkish contractors have teamed up to build oil & gas infrastructure and diversify Kazakhstan’s export routes (e.g., new pipelines and a planned Caspian oil tanker fleet). Uzbekistan and Azerbaijan, following the signing of an allied partnership in 2022, established joint logistics centers and intermodal links between Samarkand and Baku, providing Uzbek exporters with direct access to the Caspian Sea via Azerbaijan, thereby bypassing longer routes. They also established a high-level economic council that developed roadmaps for trade growth and identified $500 million in joint investment projects in the technology and industrial sectors. Most recently, Uzbekistan and Azerbaijan signed an agreement to increase the volume of trade turnover to $1 billion by 2030 during the state visit of President Shavkat Mirziyoyev to Baku from July 2 to July 4, 2025.
Trilateral cooperation formats, such as Azerbaijan-Türkiye-Kazakhstan (held in Baku, Azerbaijan, on 27 June 2022) and Türkiye-Azerbaijan-Uzbekistan (held on 29 January 2025 in Ankara) summits, have further integrated these efforts, aligning multi-country infrastructure plans and commercial standards. In the observer sphere, Hungary’s engagement with the Turkic world has yielded concrete dividends. Its trade with OTS members exceeded $5 billion in 2023, up 20% year-on-year, and Hungarian firms are thriving in the Turkic markets. Hungary also became the first EU country to import natural gas via Türkiye, thanks to new agreements linking to the Turkic energy network. These examples demonstrate how intra-OTS initiatives are delivering tangible economic benefits, including increased exports and job creation, as well as enhanced connectivity and energy security for all participants.
The Intra-OTS trade growth helps smaller Central Asian economies like Kyrgyzstan diversify away from heavy reliance on larger partners like Russia or China. Kyrgyzstan’s trade turnover with OTS states increased by 62%, exports increased by 54.6%, and imports by 66%” — stated by Economy Minister Daniyar Amangeldiev at the 13th meeting of OTS ministers in Bishkek. Similarly, Uzbekistan’s outreach to Turkic neighbors has made Kazakhstan and Türkiye top destinations for Uzbek products, spurring growth in its manufacturing and food-processing sectors. For Türkiye, the Turkic region represents a growing outlet for Turkish finished goods (such as machinery, vehicles, and household appliances) and a source of critical raw materials. Türkiye’s exports to Central Asia have nearly doubled in the past five years, and Turkish companies’ investments have created thousands of jobs in Kazakhstan, Uzbekistan, and Kyrgyzstan, primarily in construction, retail, and textiles.
Energy cooperation remains a foundational pillar of economic relations within the OTS. Azerbaijan, in particular, has reaped substantial benefits from the intra-Turkic energy trade. Each year, Türkiye imports billions of cubic meters of Azerbaijani natural gas through the Trans-Anatolian Natural Gas Pipeline (TANAP), ensuring Baku a stable revenue stream while providing Ankara with a reliable, non-Russian energy source. By 2023, Azerbaijan had become Türkiye’s second-largest gas supplier. Kazakhstan and Turkmenistan (an observer state) likewise regard Türkiye as a key export destination and are actively exploring routes to deliver their gas via the Caspian Sea for transit to Türkiye and onward to European markets. These energy corridors not only strengthen export earnings for Caspian producers but also enhance energy diversification and security for importing nations. Moreover, collaborative ventures such as the planned Azerbaijan-Georgia-Romania-Hungary electric corridor promise to generate new revenue streams for Turkic states by enabling the export of renewable electricity to Europe. In parallel, such cooperation is accelerating the development of critical infrastructure, including Kazakhstan’s oil exports via the Baku-Tbilisi-Ceyhan pipeline and proposed projects like the Trans-Caspian Gas Pipeline, both of which have the potential to unlock sustained, long-term growth in the regional energy sector.
Landlocked Central Asian members are increasingly using the OTS framework to transform from geographic bottlenecks into vital transit hubs. Kazakhstan, for example, is making significant investments in railways, roads, and port infrastructure (within the wider framework of the national “NURLY ZHOL” project) as part of its broader strategy to capitalize on the Middle Corridor and capture a greater share of trans-Eurasian freight flows. With geopolitical shifts, particularly the disruption of traditional China-Europe routes due to the Russia-Ukraine war, freight volumes through Kazakhstan, Azerbaijan, and Türkiye have grown, directly benefiting their rail operators, logistics companies, and transit-dependent industries. Uzbekistan, through strengthened partnerships with Azerbaijan and Türkiye, has also gained more direct and cost-effective access to European and Middle Eastern markets. Containers that previously had to transit Russia or Iran can now be routed via the Caspian Sea, significantly reducing delivery times and expenses. In turn, countries like Azerbaijan and Georgia are earning growing transit revenues by serving as key conduits for Central Asian exports. This enhanced connectivity is having a multiplier effect across the region. It stimulates related sectors such as logistics services, free-trade zones, warehousing, and port operations, generating employment and attracting ancillary investment. As a result, OTS member states are not only improving their competitiveness but also contributing to the emergence of a more integrated and dynamic Eurasian trade landscape.
Intra-OTS investment flows are playing a critical role in advancing industrialization and economic diversification across the Turkic world. Turkish foreign direct investment (FDI), in particular, has been instrumental in financing new industrial ventures, such as cement plants in Uzbekistan, textile factories in Kazakhstan, and tourism infrastructure in Kyrgyzstan. Beyond capital, Turkish contractors are actively involved in large-scale construction projects across Central Asia, including roads, airports, and housing developments, which also facilitate the transfer of technical expertise and modern construction standards. Conversely, outbound investments from fellow OTS members are reinforcing reciprocal economic ties. Azerbaijan, through its state oil company SOCAR, has become one of Türkiye’s leading foreign investors, with multibillion-dollar stakes in petrochemical facilities and oil terminals that underpin the strategic energy partnership between the two countries. For instannce, in 2019, SOCAR acquired the Petlim container terminal in the Aegean region (Aliağa), expanding its presence in oil storage and logistics. Most recently, in January 2025, SOCAR Türkiye announced a planned $7 billion investment to expand the capacity of its Petkim polyolefin facilities in İzmir, part of a portfolio of petrochemical and refining assets established since its 2008 acquisition of Petkim. Similarly, Kazakhstan’s sovereign wealth fund has acquired stakes in Turkish financial institutions, further deepening bilateral economic interdependence. Previously, the fund acquired a 34% stake in Türkiye’s Sekerbank, purchasing it from BTA Bank (state-owned lender in Kazakhstan) for approximately $166 million. Moreover, in October 2024, Kazakhstan’s leading e-commerce and fintech firm (valued at $21 billion on Nasdaq), Kaspi.kz spent $1.127 billion to purchase a 65.41% share of Hepsiburada, one of Türkiye ‘s largest e-commerce platforms. Kaspi.kz also plans to fully acquire Rabobank A.Ş. in Türkiye. This deal is pending approval from Turkish regulators, including the BDDK and the Competition Authority.
These initiatives also foster knowledge exchange and policy harmonization among stakeholders within the Organization of Turkic States (OTS). By facilitating regular dialogue and collaboration, OTS mechanisms are enabling member states to learn from one another’s economic development models, institutional innovations, and regulatory practices. For instance, Türkiye’s extensive experience with public-private partnerships (PPPs), special economic zones (SEZs), and industrial clustering is increasingly serving as a blueprint for similar efforts across the region. A notable example is Kazakhstan’s newly launched “Turan” SEZ in Turkestan, which draws inspiration from Turkish models and is being actively promoted as a magnet for investment from across the Turkic world. This zone is expected not only to accelerate industrialization in southern Kazakhstan but also to become a showcase of intra-OTS cooperation in mobilizing capital, technology, and expertise. Similarly, Azerbaijan’s Alat Free Economic Zone (AFEZ), strategically located along the Caspian Sea near the Port of Baku is emerging as a key hub for regional trade, logistics, and advanced manufacturing. Positioned at the crossroads of the Middle Corridor, AFEZ is designed to attract Turkic and international investors through world-class infrastructure, regulatory transparency, and targeted sectoral incentives. It exemplifies how OTS member states are adapting best practices to local contexts while fostering a cohesive regional investment environment that enhances connectivity and industrial capacity across the Turkic geography.
Greater economic integration within the OTS is increasingly manifesting at the grassroots level. Lower trade barriers and improved logistics have made it significantly easier for small and medium-sized enterprises (SMEs) to engage in cross-border commerce. For instance, a textile workshop in Osh (Kyrgyzstan) can now export garments to Istanbul or Almaty using simplified customs procedures, while a Turkish food producer can more easily access distribution networks in Baku or Tashkent. The Union of Turkic Chambers of Commerce plays a vital role in facilitating these connections, helping match businesses across national boundaries, and supporting regional trade fairs and forums. Complementing this, initiatives such as the Turkic University Union and scholarship programs, Hungary alone hosts over 5,000 students from OTS countries, creating a pipeline of culturally fluent professionals and entrepreneurs. These individuals are uniquely positioned to reinforce economic ties through shared language, trust-based relationships, and regionally embedded networks. Over time, such people-to-people connections contribute to the emergence of a shared economic culture within the Turkic world.
In a broader sense, the Turkic states are gradually leveraging their complementary economic advantages to build integrated development strategies. Azerbaijan, strategically positioned as a key energy exporter and logistics hub along the Middle Corridor, provides critical energy infrastructure and transit connectivity that underpin regional integration. Türkiye brings strong capabilities in construction, infrastructure development, and logistics. Kazakhstan contributes substantial financial resources through its sovereign wealth funds and investment institutions. Uzbekistan, with its youthful and skilled labor force, offers a dynamic workforce that supports manufacturing and service industries. Kyrgyzstan, with its agile entrepreneurial environment and growing engagement in light industry and digital solutions, adds adaptability to regional economic efforts, particularly in textiles, agriculture, and e-commerce. Hungary, as an observer state and a gateway to the European Union, contributes technological innovation, regulatory expertise, and enhanced access to EU markets, reinforcing the bloc’s external linkages and policy alignment potential. Another observer state, Turkmenistan, with its vast reserves of natural gas and its strategic location along east-west corridors, holds the potential to strengthen the region’s energy diversification and trans-Caspian logistics, while also participating in emerging renewable energy and fiber-optic connectivity projects. Meanwhile, the Turkish Republic of Northern Cyprus (TRNC), though limited in international recognition, offers unique opportunities for academic collaboration, tourism development, and cultural diplomacy, which contribute to the soft-power dimension of Turkic cooperation. Together, these diverse strengths form the backbone of a shared development vision, one that enhances regional competitiveness, fosters inclusive growth, and advances the Turkic world’s long-term prosperity, resilience, and strategic relevance on the global stage.
The evolution of the Organization of Turkic States from a cultural and political platform into a dynamic engine of regional economic cooperation marks one of the most significant developments in Eurasian integration over the past decade. What began as a modest framework for intergovernmental dialogue has matured into a results-driven mechanism for trade, investment, and infrastructure development across a strategically vital region. Intra-OTS trade has more than doubled its share in recent years, and intra-bloc investment is visibly transforming key sectors—from energy and construction to digital innovation and logistics. OTS member states are no longer content to serve as peripheral players in global trade networks. Instead, they are increasingly shaping the contours of Eurasian commerce by expanding interconnectivity through the Middle Corridor, creating joint industrial and energy ventures, and harmonizing trade and transport regulations. The emergence of institutions like the Turkic Investment Fund, the Digital Economy Partnership, and the Green Finance Council signals a maturing ecosystem that supports both state-led and private-sector collaboration. These institutional frameworks not only facilitate large-scale projects but also empower small and medium-sized enterprises and promote people-to-people ties, essential for building a resilient, inclusive regional economy.
Vusal Guliyev is a Sinologist and Policy Analyst specializing in the geopolitical affairs of Eurasia and the Asia-Pacific region. He currently works as a Policy Advisor at the Baku-based Center of Analysis of International Relations and also serves as the Head of the Shanghai Office at AZEGLOB Consulting Group. He is also affiliated with the Topchubashov Center as an Associate Expert, a global policy think tank where he writes extensively on East Asian and Indo-Pacific affairs.
