Silk Road Monthly: September 2024
China Expands Strategic and Economic Ties with Central Asia Through Growing Infrastructure and Security Collaborations
Bedel Border Crossing
On September 3, China and Kyrgyzstan opened the third border crossing between the two countries. The Bedel border crossing is now the northernmost China-Kyrgyzstan crossing, situated in Issy-Kul region and Aksu prefecture. The border checkpoint was reportedly agreed upon last May during Kyrgyz President Sadyr Japarov’s state visit to China.
China-Central Asia Counterterrorism Meeting
On September 10, representatives from the Ministries of Internal Affairs from China, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan met in Lianyungang in Jiangsu province. Talks were held to discuss regional cooperation in countering terrorism and transnational crime, primarily extremism, cybercrime, drug trafficking and human trafficking.
Chinese Minister of Public Security, Wang Xiaohong, highlighted that “China is willing to enhance the capability for counterterrorism and transnational crime fighting, and build an efficient and pragmatic cooperation platform with Central Asian countries to achieve the vision of universal security.” Wang emphasized the importance of the forum to build security cooperation and build trust between China and Central Asian states.
This meeting came a year after the first China-Central Asia summit, and publicly introduced China-Central Asian cooperation to security and stability. Central Asia is a major region for the Chinese Belt and Road Initiative (BRI), which has seen new railroad projects, increased trade, and greater cooperation with China.
Chinese PSC Presence in Central Asia
Odil Gafarov, a political science PhD student at Southern Illinois University, discussed the role of Chinese private security companies (PSCs) in Central Asia. He explained the significance of the region for China’s Belt and Road Initiative (BRI), which has seen over $70 billion of Chinese investments in the region.
However, Chinese interests in Central Asia go beyond just economics, covering security as well. The Chinese government remains very concerned over the security and stability of its western border in Xinjiang. China conducts joint military exercises and intelligence sharing with Central Asia.
The main objective of Chinese PSCs in Central Asia is to protect Chinese assets, both investments and personnel. Chinese PSCs’ services include logistics, security training, armed/unarmed protection, intelligence gathering, and insurance services. Chinese PSCs have been introduced to accompany BRI projects as a result of attacks on Chinese workers, anti-Chinese protests, and disputes with locals. PSCs are required to abide by local laws and the rules set out by the Chinese government.
Nuclear Referendum in Kazakhstan
On October 6, Kazakhstan held a referendum to decide whether to build a nuclear power plant to support its electric grid. The referendum passed with a sizable majority. Reminders of a nuclear past hold many voters hesitant, particularly, the memories of the Chernobyl disaster and Semipalatinsk nuclear testing site. Other voters are concerned of the environmental impact it could have, given that it will likely be built near Lake Balkhash and could impact its water supply.
Russia’s Rosatom was considered the favorite to be awarded the project, while China’s National Nuclear Corporation, France’s EDF and South Korea’s Korea Hydro & Nuclear Power were also being considered. The nuclear power plant will be the first nuclear power station built in Kazakhstan.
Earlier this year, Kazakhstan’s Kazatomprom signed a long-term deal with China’s National Uranium Co. Ltd to export uranium to China. Kazakhstan is the world’s largest uranium provider, producing over 40% of the world’s uranium.
Uzbek Battery Energy Storage System
The battery energy storage system (BESS) project has been successfully completed in the Fergana Valley. The BESS facility has the capacity to produce 150 MW/300 MWh. Chinese Energy Overseas Investment Co. Ltd (CEEC), Huawei, and Central South China Electric Power Institute (CSDI) were awarded the $140 million contract to construct the BESS facility.
The facility is projected to produce 2.2 billion KWh of electricity annually. Uzbekistan has experienced numerous power outages in recent winters due to a surge in electricity demand. The new plant is expected to increase the stability and reliability of Uzbekistan’s power grid.
Skyhansa
The Kazakh-German consortium, Skyhansa signed off on a project to build a cargo-passenger airport in the Khorgos special economic zone (SEZ) at the German-Central Asia summit on September 17 in Astana. The project will reportedly cost $500 million and is projected to create 300 jobs.
Khorgos (Khorgas in China) is a multinational city, situated on the China-Kazakh border. It is the largest dry port in the world, handling an annual freight volume of around 15 million tons. The airport is projected to handle 500 passengers per hour, 250,000 annual tons of cargo, and 550,000 tons of fuel in its fuel storage facility.
Freedom Holdings
Freedom Holdings, a Kazakh conglomerate based in Almaty, is planning work with China International Capital Corp to help sell dim sum bonds on the Hong Kong market. This move comes in an attempt to finance a “hyper highway” across Kazakhstan. Freedom Telecom, the recently created subsidiary of Freedom Holdings is planning to invest $236 million by 2027 to provide data centers and high-speed internet access across Kazakhstan.
The proposed data center will be located in Aktau, in western Kazakhstan on the coast of the Caspian Sea. Aktau is also the start of the Trans Caspian Fibre Optic Cable, which runs under the Caspian to the Azeri port city of Sumgayit. The “hyper highway” will reportedly connect Central Asia with the Middle East and Europe, while bypassing Russia.
Chinese Security Initiatives in Central Asia
Adina Masalbekova, a Bishkek-based China-Central Asia researcher, discussed China’s security leverage in Central Asia with USIP. China offers three key initiatives to counter Western influence and hegemony: the Shanghai Cooperation Organization (SCO), the Belt and Road Initiative (BRI) and the Global Security Initiative (GSI).
Through these platforms, China emphasizes noninterference, territorial sovereignty, and win-win cooperation. The SCO highlights the “three evils” of separatism, extremism, and terrorism as the threats to participating countries’ security and sovereignty.
Chinese leverage, while yielding these platforms, has prevented any momentum of Xinjiang-related protests in Central Asia. Meanwhile, Tajikistan and Uzbekistan have faced their own separatist concerns in Karakalpakstan and Gorno-Badakhshan. Kyrgyzstan has seen Chinese PSCs operating throughout the country, over concerns of information dissemination, protests, and anti-Chinese demonstrations or attacks. Many Central Asian countries have adopted Chinese technology in developing their own “safe” or “smart city” projects, leading to concerns over surveillance and privacy infringements.
Chinese Grant to Kyrgyz Ministry
On September 19, an agreement was signed to allocate a grant of over $28 million from the Chinese government to the Kyrgyz Ministry of Economy and Commerce. It is unclear which projects the grant will finance, but there are talks over the provision of agriculture equipment and machinery and the opening of an agricultural training center.
Chinese-Kyrgyz Trade Center
On September 21, a Chinese-Kyrgyz trade cooperation center opened in Xi’an. The center will hold exhibitions of Kyrgyz products, facilitate meetings between Kyrgyz and Chinese entrepreneurs, and provide information to the Chinese public about Kyrgyzstan.
A Kyrgyz trade pavilion was also opened on September 21 in downtown Xi’an. The pavilion will sell Kyrgyz goods both offline and through Chinese applications such as WeChat, Pingduoduo, and Duoyin.
Solar Plant Construction
On September 23, China Datang began constructing a 263 MW construction plant in Uzbekistan’s Tashkent region. The project will require over 600 hectares of land and a $150 million investment. At the end of 2023, Uzbekistan had a solar power capacity of 253 MW.
Kazakh Agro Production Project
Chinese state-owned CITIC Construction has agreed to invest over $1 billion to construct a deep grain processing plant in Almaty region. Over 2,000 jobs are estimated to be created for this project.
The project will construct a production line with a capacity of 300,000 annual tons of wheat processing. The plant will produce maltose, fructose, crystalline fructose, allulose, crystalline dextrose, sodium gluconate, gluten by-products, and feed.
CKU Railway Company
On September 28, LLC China-Kyrgyzstan-Uzbekistan Railway Company opened in Bishkek. The railroad project was agreed upon in June between representatives from the three countries. It will be the first railroad directly connecting Kyrgyzstan and Uzbekistan with China.
The railroad will run through Kashgar, Torugart, Makmal, Jalal-Abad, and Andijon. It is projected that the project will cost around $8 billion, which is significantly higher than the initial cost projection of $4.7 billion.
Chinese Soft Power in Kazakhstan
Berikbol Dukeyev discusses the forms of Chinese soft power in Kazakhstan in response to anti-Chinese protests in the Central Asian state. As Kazakh public opinion has become more influential in shaping policymaking in the aftermath of the 2022 protests, Dukeyev argues that China has stepped up efforts to improve its image in Kazakhstan through cultural, educational, and media initiatives.
Anti-Chinese sentiment is rooted in fears over Chinese land acquisition and expansion. Misinformation and concerns over Chinese investment have sparked protests in Kazakhstan. China has responded with cultural exchanges between the two states and co-productions of films highlighting the strength in partnership and historical ties between the two countries.
Kazakhstan enjoys visa-free access to China, with many students now studying in China. Skepticism still remains as China is attempting to build trust with the Kazakh people without overstepping.
This is not dissimilar to previous soft-power initiatives in Central Asia. Chinese soft power initiatives in Kyrgyzstan also grew after the proliferation of anti-Chinese protests. China has collaborated with Kyrgyz media outlets to publish PRC reprinted content, along with organizing training programs for Kyrgyz journalists and tailoring PRC media more for Kyrgyz audiences.