REPORT
Summary
• Uzbekistan has launched an investment program in the country’s mining sector, hoping to gain investment from global partners to support the effort.
• Uzbekistan has met with US officials on several occasions to discuss cooperation in the sector, at a time when the USA is looking to strengthen its hold on resources such as lithium.
• The risk of political instability in Uzbekistan is low, but issues such as regional geopolitical considerations can undermine Uzbekistan’s ability to export mining material to new markets.
In March 2025, Uzbekistan announced plans to develop the country’s mining sector through a major investment program. The program itself, according to a statement from the Uzbek government, will see USD2.6 billion invested into Uzbekistan’s mining sector, focusing on key resources such as tungsten, titanium, vanadium and lithium. In addition, the investment will see funding for key practices such as geological prospecting and training for new staff. Mining activity is far from a new sector for Uzbekistan and Central Asia as a broader region, but the sector has typically been held back by lack of investment which the new program seeks to address.
The project itself will also aim to continue to attract international investment and involvement, and build new trade partners outside of Uzbekistan’s traditional partners, Russia and China. The USA has stood out as a key potential partner for Uzbekistan during this push to develop the mining sector, with the USA actively seeking to get the upper hand in new precious material markets, particularly lithium.
This report will focus on the prospects of Uzbekistan’s push to further develop the mining sector from a broad geopolitical focus. In doing so, the report will focus on any potential risks that may undermine the stability and long-term prospects of the investment project.
Opportunities
Uzbekistan has always had close economic partnerships with Russia and China, with investments from both states financing major projects in Uzbekistan and the broader region. Regardless, like other Central Asian states, Uzbekistan has been cautious to avoid becoming overly reliant on these partners, and western sanctions targeting Russian banks have undermined previous Uzbek projects and impacted Central Asian economic projects. A case in point being the expansion of the Yoshlik copper mining project, which faltered due to sanctions placed on the project’s backer, Gazprombank.
The timing therefore, is important. Uzbekistan’s push to develop mining and position itself as a key player in the extraction sector at a time of increased geopolitical risk is sound. Uzbekistan seeks to capitalise on power dynamics between major global powers, and gain investment and expertise from all sides. In light of this, the US government, even before President Trump took office for his second term, has been in discussion with Uzbekistan to discuss cooperation in the mining sector. This commitment from the USA was highlighted in September 2024, when the USA signed a memorandum of understanding with Uzbekistan to strengthen cooperation between the United States and Uzbekistan on critical materials. For Uzbekistan, the USA’s need to gain a tighter grip on the extraction and processing of critical materials is a significant opportunity. Uzbekistan appears keen to court the USA and attract investment, support, expertise and importantly, a market for Uzbek minerals. Meanwhile, Uzbekistan has an opportunity to diversify its own markets and in doing so, forge new relationships with new partners.
Risks
Like any major project aimed at capitalising on a country’s natural resources, risks are inherent through the process, particularly geopolitical risks. In terms of the source of investment for the program, the long-term intentions of the USA towards Uzbekistan and the Central Asia region remain somewhat vague. The foreign policy of the new Trump administration has been fluid, with early announcements such as the suspension of USAID having impacts across the world. Nonetheless, despite flux in areas of US foreign policy, the USA is expected to continue on its current trajectory vis-a-vis Uzbekistan’s mining industry as the USA has an opportunity to be a leading partner in a critical mineral extraction market in an area of the world typically dominated by Russian and Chinese investments
Regardless, Uzbekistan must be wary of becoming overly reliant on the USA, who, as seen during the Ukrainian critical mining deal signed earlier in 2025, appears willing to utilise the USA’s influence and weight to secure deals, even with close partners. Whilst the USA is Uzbekistan’s ideal partner for the new investment program, Uzbekistan has sought to create a level of resilience and has received interest from other partners to varying degrees. The EU, for example, signed a similar memorandum of understanding in April 2024 with Uzbekistan, expressing interest in involvement in Uzbekistan’s mining sector.
It is important to note that despite pushing for US involvement in this initiative, this does not necessarily represent an attempt to diplomatically move away from Russia or China. Both Russian and Chinese investments are numerous in Uzbekistan and both back a number of key infrastructural and economic projects. EU and US sanctions have gone some way in reducing the impact of Russian investments in Uzbekistan, but many projects remain. Uzbekistan’s government must therefore tread lightly during the process and be wary of alienating traditional partners, who hold considerable influence.
Uzbekistan’s internal political stability is considered to be high, though security risks do remain, particularly regarding Uzbekistan’s border with Afghanistan. These security risks outside of Uzbekistan’s borders can and do impact the security of Uzbekistan’s trade routes, and can potentially undermine Uzbekistan’s ability to fully capitalise on projects. Uzbekistan has sought to remedy this somewhat, by maintaining sound relationships with neighbouring states. To Uzbekistan’s south, the relationship with Afghanistan has been pragmatic but trending towards cooperation, with Uzbekistan repeatedly stating since the Taliban took over Afghanistan that they are willing to work with the Taliban government. Since the Taliban take over of Kabul in 2021, trade has reached significant levels between
Security issues in Afghanistan present a potential challenge for Uzbekistan, and may, if left unchecked, undermine Uzbekistan’s ability to reach new markets to the south, and consequently reduce Uzbekistan’s ability to capitalise on the recent push to invest in Uzbekistan’s mining industry. The Uzbekistan-Afghanistan-Pakistan railway project, for example, remains vulnerable to immediate security challenges in Afghanistan. Despite an overall reduction in military clashes in Afghanistan since 2021, active anti- Taliban militias have continued their resistance since the fall of Kabul, often attacking Taliban positions in northern and central provinces. In Addition, international terror organisations such as Islamic State – Khorasan Province (ISKP) and Al Qaeda have maintained a presence in Afghanistan since the Taliban takeover, and ISKP regularly carry out attacks against civilian targets. A railway would provide a tempting and easy target for physical attacks. Lastly, whilst cross-border security incidents are uncommon, they have been reported in the past. A notable example includes an incident in April 2022 when ISKP militants fired rockets into Uzbekistan from Afghan territory. Whilst the incident itself was small and caused little damage, it served to highlight that ISKP maintains a presence in Afghanistan’s north, and has the intent to carry out attacks in neighbouring states. Even with the ISKP presence in Afghanistan, insecurity is not expected to spill over into Uzbekistan from Afghanistan, though isolated incidents such as clashes at the border with armed drugs traffickers or gunmen may occur. Whilst these threats do not pose an immediate threat to stability in Uzbekistan, they will undermine Uzbekistan’s ability to export via southern routes.
Elsewhere, Uzbekistan’s connections with markets in Europe have typically relied heavily on Russian territory and assets. Russia’s invasion of Ukraine has undermined the resilience of Uzbekistan’s trade routes, with US and EU sanctions restricting the efficiency and hampering companies involved in transit through Russia. Whilst progress has been made in diversifying Uzbekistan’s routes to new markets via routes not passing through Russia, sanctions and restrictions on Russia have still had a substantial impact on Uzbekistan’s ability to export.
Lastly, corruption in Uzbekistan is not a new phenomenon, and has at times directly impacted Uzbekistan’s mining sector. According to transparency.org, Uzbekistan sits in rank 121 out of 181 in the Corruption Perception Index, meaning incidents such as bribery and abuses of power are common. Data from transparency.org also shows that Uzbekistan has slowly improved its rating, though a slight dip was recorded between 2023 and 2024. In Intelligence Fusion routine reporting, corruption related incidents specific to the mining sector in Uzbekistan are rarely reported, though minor transgressions such as officials using positions of power to siphon away funds or materials are relatively common. In the majority of cases which are reported, these incidents involve officials involved in coal mining selling coal from state warehouses. Such cases are not expected to significantly undermine Uzbekistan’s push for investment in the mining sector, but the incidents suggest a level of corruption is present and directly impacts companies on the ground. The cases therefore represent an additional layer of risk, which companies seeking to get involved in the Uzbek mining initiative must navigate. The Uzbek government has sought to combat corrupt practices in the mining sector to reassure foreign partners and improve the sector as a whole, seemingly with some success. In 2024 the Ministry of Mining Industry impacts companies on the ground. The cases therefore represent an additional layer of risk, which companies seeking to get involved in the Uzbek mining initiative must navigate. The Uzbek government has sought to combat corrupt practises in the mining sector to reassure foreign partners and improve the sector as a whole, seemingly with some success. In 2024 the Ministry of Mining Industry and Geology was ranked first among state departments in Uzbekistan by the Uzbek government in its efficiency in the fight against corruption. and Geology was ranked first among state departments in Uzbekistan by the Uzbek government in its efficiency in the fight against corruption.
Conclusion
Uzbekistan’s campaign to develop the mining sector through investment and cooperation with foreign partners comes at an opportune time, but issues such as regional geopolitical risk will likely serve to slow progress in exporting goods. Internally, the risk posed to the mining sector by events such as political instability or physical insecurity is low, despite concerns over issues such as radicalisation and Uzbek nationals fighting overseas as part of jihadist groups. Instead, the most significant risks posed to the push to develop the national mining sector comes from Uzbekistan’s ability to export resources to new markets. Insecurity in Afghanistan, in conjunction with geopolitical issues and sanctions on key transit states such as Russia and China have made expansion to new markets difficult for Uzbekistan, and have meant that geopolitical issues in surrounding regions have had a significant impact on Uzbekistan’s ability to develop internally.
With these opportunities and risks in mind, Uzbekistan will likely seek to tread lightly, balancing the interests of their traditional economic partners in Russia and China with the interests of new major partners such as the USA, the EU and markets in South Asia. All the while, whilst Uzbekistan itself remains relatively stable from a political perspective, the country’s landlocked status ensures that there will always be a reliance on external transit routes, all of which are vulnerable to geopolitical changes. Fortunately, for Uzbekistan, timing is key. The new Trump administration, as with previous administrations, has openly sought to reduce their reliance on China for extraction of critical resources, and for certain resources, Uzbekistan appears to be a highly valuable partner for the USA going forwards.
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