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Caspian Connectivity and the Ukraine Conflict: An Outlook for 2023

Eugene Chausovsky

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As the war in Ukraine enters its second year and shows no signs of ending anytime soon, the prolonged conflict has presented both significant challenges and opportunities for the Caspian region. On the one hand, Caspian countries have faced substantial difficulties associated with the war, including rising inflation and economic pressures, as well as an increasingly complex security environment in their near abroad. On the other hand, the disruption in economic links between Russia and the West and the strategic location of Caspian states like Azerbaijan, Kazakhstan, and Turkmenistan have highlighted the importance of such countries to connectivity pursuits within Eurasia, including in critical fields like energy and transport. 

This dichotomy between conflict and connectivity will be a key feature of this coming year, as Caspian states seek to mitigate regional pressures and build upon significant progress made in further developing the ‘Middle Corridor’, a trade and infrastructure route between Europe and China which transits through the Caspian region and circumvents Russia. Further development and expansion of this route would not only strengthen Europe’s economic diversification from Russia as Moscow doubles down on its war in Ukraine, but it could also contribute to greater resilience throughout the Eurasian landmass and well beyond. However, the viability and sustainability of such Caspian connectivity projects will in large part depend on external support, and the West can play a particularly important role in this regard. 

To determine the most effective and impactful way in which Caspian connectivity can be enhanced in the future, it is important to first review the progress that has already been made over the past year. Since Russia’s invasion of Ukraine in February 2022, there has been much advancement concerning the Middle Corridor route, also known as the Trans-Caspian International Transport Route (TITR). In July, the EU reached an agreement to increase natura- gas imports from Azerbaijan, and Kazakhstan and Azerbaijan signed an Memorandum of Understanding on new bilateral natural-gas projects the following month. Beyond energy flows, Kazakhstan increased uranium exports all the way to Canada via the Middle Corridor last year. Overall, the transit of goods via the Middle Corridor tripled in volume in the first nine months of 2022, year on year. 

Read more in the Caspian Policy Center.