AGP Executive Report

Energy Grid Shock: KEGOC says Kazakhstan’s Aug. 14 blackout was triggered by an emergency shutdown of two Toktogul HPP hydrogenerators (600 MW) in Kyrgyzstan, causing a surge and overload on the North–South transit line, separating Kazakhstan’s southern zone before power was restored by late afternoon. Regional Power Disruptions: Reuters reports simultaneous outages across Kazakhstan, Kyrgyzstan, Tajikistan and parts of Uzbekistan, with Central Asia’s hydropower dependence and grid interconnections again in the spotlight. Logistics Push: Kazakhstan launched the Kusto Logistics multimodal hub in Almaty Region, targeting up to 100,000 containers a year and adding a new grain terminal under construction. Agriculture Trade: Armenia and Kazakhstan discussed expanding agri-food cooperation, including water management, irrigation, livestock and processing, with Armenian exports like wine, fresh produce and fish flagged for growth. AI Geopolitics: A US warning to countries in Pax Silica to avoid joining China’s WAICO puts Kazakhstan’s balancing act under pressure as AI supply-chain blocs harden. Film Production: Kazakhstan began the final stage of filming “Molla Nasreddin – Friend of My Hard Days,” with scenes planned in Almaty Region, Almaty and Turkistan.

Energy Grid Shock: Kazakhstan’s grid operator KEGOC says the Aug 14 blackout was triggered by an emergency shutdown of two Toktogul HPP hydrogenerators in Kyrgyzstan (600 MW), which overloaded the North–South transit line and separated southern Kazakhstan from the unified Central Asian system; power was restored by late afternoon, with a special commission to investigate. Regional Blackout Spillover: Reuters and local reports say the same disturbance hit Kyrgyzstan, Tajikistan and Uzbekistan, with authorities pointing to sudden changes in cross-border power flows and isolated operating modes. Logistics Hub Push: Kazakhstan launched the Kusto Logistics multimodal complex in Almaty Region, built for up to 100,000 containers a year and a new grain terminal under construction, aiming to strengthen north–south freight links. Agriculture Trade Talks: Kazakhstan and Armenia discussed expanding agricultural cooperation, including water management and processing, with Armenian officials highlighting growth potential for wine, produce and fish exports to Kazakhstan. Energy Security Watch: Separate reports note Russia’s Sheskharis terminal in Novorossiysk suspended crude exports after a drone attack, affecting shipments that include Kazakhstan’s KEBCO blend.

Black Sea Energy Disruption: Russia suspended crude exports from the Sheskharis terminal at Novorossiysk after a drone attack, with storage tanks reaching capacity; the port also handles Kazakhstan’s KEBCO blend and could further disrupt loading schedules. Central Asia Power Shock: A sudden change in electricity flows across the interconnected grid triggered blackouts across Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan; Kazakhstan’s energy ministry and KEGOC pointed to a 500 kV line shutdown and emergency protections, with restoration work underway and some restrictions already lifted. Logistics Push in Kazakhstan: A new Kusto Logistics multimodal hub in Almaty Region began operations, targeting up to 100,000 containers a year and adding a grain terminal under construction. Digital Infrastructure: Kazakhstan is progressing Data Center Valley in Pavlodar Region, with the first 50 MW facility on track for commissioning in May 2027 and launch in June 2027. Agri-Trade Talks: Armenia and Kazakhstan discussed expanding agricultural exports, including wine, fruits/vegetables and fish, alongside water and irrigation cooperation. Oil Market Pressure: The IEA warned of a deepening global oil deficit in Q3 amid Middle East shipping disruptions, with reduced Kazakh exports and Russian refining disruptions cited.

Oil & Logistics Diversification: Kazakhstan’s KazTransOil shipped 155,000 tons of Kazakh crude via the Port of Aktau to the BTC pipeline in July, up 11.5% year-on-year, with 704,000 tons loaded for BTC in H1 2026 as Astana targets 2.2 million tons through BTC in 2026. Waste-to-Energy Push: Kazakhstan plans waste-to-energy plants in Astana, Almaty and Shymkent, with agreements signed with three Chinese investors; the ministry says sorting and recycling still come first, and only 5–10% of waste remains for landfill after thermal processing. Infrastructure Upgrades: President Tokayev urged faster infrastructure modernization in West Kazakhstan, including utilities, bridges, road repairs and checkpoint reconstruction. Mining Oversight: Illegal manganese extraction in Ulytau was uncovered, with over 23,000 tons sold and more than 1 billion tenge earned, while land restoration is estimated at 150+ million tenge. Labor Mobility: South Korea added Kazakhstan as an E-9 sending country (quota 80,000 total), enabling work mainly in agriculture, manufacturing, construction and related sectors starting in 2028. Tech & Transport: Kazakhstan approved a three-year pilot for advanced self-driving vehicles (Level 3–4) on designated public roads in Astana, Almaty and Akmola. Macroeconomic Trend: Kazakhstan’s inflation fell for the 10th straight month to 10.2% in July, supported by monetary policy and coordinated anti-inflation measures.

Black Sea & Energy Disruptions: Ukraine proposed a deal with Russia to halt attacks on civilian ships in the Black Sea, aiming to reopen the grain corridor as drone strikes keep hitting ports and tankers. Kazakhstan Logistics & Transit: With CPC disruption and Black Sea risks, Kazakhstan is pushing alternative routes and logistics links—from rail corridors to the China-to-Black Sea network—while maritime security training for Caspian ports (Turkmenbashi–Alyat) highlights tighter cross-border cargo controls. Caspian Infrastructure & Data: Kazakhstan and Azerbaijan completed the marine section of the Trans-Caspian fiber-optic line “Sumgayit–Aktau,” boosting the Middle Corridor’s digital backbone. Power & Industry Investment: Kazakhstan plans to launch the first Data Center Valley facility in summer 2027 (50 MW object, June 2027 commissioning), targeting stable electricity supply and foreign tech demand. Mining & Coal: UAE investor MQ Emirates Group won a 25-year license for Kazakhstan’s Kenderlyk coal deposit, with production slated to start in 2028. Finance & Development: China’s CCXI upgraded Eurasian Development Bank’s rating to Ag globally and affirmed AAA on the national scale, citing stronger capital and risk management. Environment & Water Risk: The Caspian Sea water level has fallen to a ~200-year low, with evaporation and reduced inflows threatening coastal infrastructure and ecosystems.

Kazakhstan–China Deal: Kazakhstan and China agreed to deepen cooperation in industry, energy, and construction, with a push to shift from raw trade volumes to value-added goods and machinery, chemicals, pharma, and light industry. Oil & Exports Pressure: The IEA warned of a widening global oil supply deficit as Hormuz reopening stalls, with knock-on effects including reduced Kazakh CPC Blend exports amid Black Sea disruption. Black Sea Risk for Kazakh Crude: Ukraine hit Russia’s Novorossiysk with drones and missiles, disrupting grain terminals and raising freight and insurance costs for tankers carrying Kazakhstan-linked CPC crude, while reports say Ukraine paused strikes on some non-Russian tankers and CPC infrastructure after a U.S. request tied to market stability. Weather for Cotton: Kazakhstan launched large-scale cloud seeding in Turkestan with UAE support, targeting 911,000 hectares of cotton land and aiming for major economic gains. Consumer & Services: Kazakhstan’s beauty sector hit 127B tenge in 2025, led by hairdressing. Regional Connectivity: The SCO marked its 25th year with a Bishkek agenda spanning security, connectivity, energy, and digitalisation.

Black Sea Energy Disruption: Ukraine paused drone strikes on oil tankers using the Caspian Pipeline Consortium (CPC) terminal at Novorossiysk after a US request tied to Kazakhstan-origin crude flows, with Kyiv agreeing not to target CPC infrastructure or non-Russian vessels (unless sanctioned or carrying Russian cargo). Oil Market Pressure: The IEA cut its 2026 oil supply forecast to a record-low level, citing Strait of Hormuz closures and Bab el-Mandeb attacks, while also pointing to reduced Kazakh CPC Blend exports from Black Sea disruptions. Kazakhstan Export Risk: Freight and insurance costs for CPC-linked routes jumped to record levels, pushing CPC differentials down and raising the stakes for Kazakhstan’s oil transit options. Almaty Transport Upgrade: Almaty plans to restart tram service via a light rail transit line, targeting a first 18.3 km phase launch by end-2027 amid major utility relocation work. Digital Security Alert: Kazakhstan’s eGov data breach claims involving 15 million citizens are under review after alleged dark-web posting, with the ministry saying there’s no confirmed proof yet. Industrial Partnerships: ATIRE named Bohnenkamp as its industrial tyre distribution partner across Kazakhstan and several regional markets. Agribusiness Note: Kazakhstan’s flour and grain supply chain remains in focus as regional production and processing capacity expand.

Black Sea Energy Shock: Ukraine’s drone and missile campaign hit Russia’s Novorossiysk, with reports of grain terminal shutdowns and damage to port infrastructure, while Ukraine later paused strikes on tankers tied to the Caspian Pipeline Consortium after a U.S. request—an issue directly tied to Kazakhstan crude exports. Freight & Transit Pressure: Freight rates to Russia and Central Asia rose 10–15% as carriers face higher costs, fuel shortages, and added security friction through Russian routes. Drought Response: Kazakhstan launched large-scale cloud-seeding in Turkestan to boost rainfall over about 9,110 sq km of cotton farmland, aiming for higher harvests and pairing it with irrigation and canal repairs. Industrial Growth Watch: Kazakhstan’s economy grew 4.1% in Jan–Jul 2026 despite a 8.9% oil-production drop, led by manufacturing (9%) and gains in food, chemicals, pharma, and mechanical engineering. Solar Buildout: Arctech secured 425 MW of solar tracker projects across Central Asia, including 100 MW in Kazakhstan. Urban Planning: Astana approved an updated master plan through 2035 to support rapid population growth and expand housing, transport, and utilities. Rail Modernization: 71 railway stations have been commissioned under Kazakhstan’s modernization push, with remaining upgrades on schedule. Agribusiness Investment: A tomato processing plant is set for Kyzylorda, targeting up to 600 tons/day and building a cultivation-to-processing chain. Sports (Light): Elena Rybakina advanced to the Toronto semifinals after beating Naomi Osaka.

Crypto Policy: President Tokayev signed a decree granting a three-year personal income tax exemption on digital-asset gains for transactions via Kazakhstan-licensed providers (Jan 2026–Dec 2028), aiming to pull about 1 million crypto wallets from offshore platforms back to regulated exchanges. Macroeconomic Stability: Kazakhstan’s GDP grew 4.1% in Jan–July 2026 as the non-resource sector rose 5.4% and manufacturing climbed 9%, even with oil output down 8.9% to 53.2 million tons. Oil & Transit Diversification: After Caspian Pipeline Consortium intake limits in July, Kazakhstan rerouted crude via Aktau port and existing pipelines to China and Russia, and is now weighing further routes through Azerbaijan and Georgia, including Baku-Supsa and Baku-Tbilisi-Ceyhan. Agro-Processing Investment: Alpecon Group plans to invest 2.3 billion tenge to modernize a tomato processing plant in Kyzylorda, targeting up to 600 tons/day and building an integrated cultivation-to-processing chain. Renewables & Solar Supply: Arctech secured 425 MW of solar tracker projects across Central Asia, including 325 MW in Kyrgyzstan and 100 MW in Kazakhstan, citing site-specific engineering for frost-heave soils. Regional Food Exports: Kyrgyzstan exported 746.7 tons of fish products in Jan–July 2026, with Russia and Kazakhstan as key destinations.

Aviation & UAM: EHang’s EH216-S completed Central Asia’s first passenger-carrying pilotless eVTOL flight in Astana during the Games of the Future, following Kazakhstan’s June regulatory framework for eVTOLs, vertiports and unmanned traffic management. Oil & Transit: Kazakhstan says it rerouted some crude exports after temporary CPC intake limits in July, sending volumes via Aktau port, Atasu–Alashankou and Atyrau–Samara, while weighing further options including BTC and Baku–Supsa as CPC disruptions tied to Black Sea risks continue. Retail Logistics: Wildberries is expanding in Kazakhstan with plans for 260,000 sqm of new warehouse capacity in Astana and Almaty, as drone attacks in Russia have pressured its logistics network and affected Kazakh sellers. Energy Industry Platform: KIOGE 2026 (30th edition) is set to bring 235+ companies from 15 countries to showcase oil & gas tech and partnerships, underscoring Kazakhstan’s push to deepen investment across production, refining, petrochemicals and automation. AI & Health Services: Kazakhstan is also positioning for new tech and services—crypto amnesty aims to pull digital assets into regulated channels, while Lilavati Hospital plans a Kazakhstan super-speciality OPD opening in early September 2026. Regional Cooperation: Kazakhstan and Azerbaijan are deepening Caspian cooperation under the Middle Corridor concept, with a new Central Asia–Azerbaijan presidential declaration signed in Cholpon-Ata. Creative Industries: Jackie Chan’s “Armour of God IV: Ultimatum” began filming in Baku, with Kazakhstan-China crew involvement and Caspian-themed scenes.

Caspian Oil Security: Under U.S. pressure, Ukraine reportedly agreed to halt attacks on foreign-flag tankers heading to the Caspian Pipeline Consortium (CPC) terminal near Novorossiysk, after strikes had repeatedly suspended loadings and raised insurance and freight costs for Kazakh crude. Export Diversification: Kazakhstan is now weighing additional oil export routes via Azerbaijan—Baku-Tbilisi-Ceyhan and Baku-Supsa—plus Caspian Sea transit, as CPC disruptions and Black Sea risks keep pushing Astana to reduce reliance on Russian infrastructure. Logistics Push: CargoPoint opened an Almaty office to expand its Truck+Air China-Europe network, aiming to cut transit times by up to two days versus Russian rail and Red Sea lanes. Local Industry: Kazakhstan is increasing Kazakh content in oil and gas procurement, setting minimum local value requirements and localization targets for major projects like Tengiz, Karachaganak and Kashagan. E-commerce Expansion: Wildberries plans to build 260,000 sq m of warehouses in Astana and Almaty, as Kazakhstan-based sellers try to recover from repeated attacks on logistics hubs. Finance & Payments: Kaspi.kz published 2Q/1H 2026 results, proposing a KZT 1,000 dividend per common share and rolling out “Kasper” AI shopping assistant to more e-commerce users. AI Infrastructure: Firebird officially opened the CIS’s largest AI data centre in Armenia, with Kazakhstan’s deputy PM attending and the project framed as part of a broader regional AI buildout. Construction & Agri-Industry: New industrial and social facilities were commissioned nationwide, including a 7 bln tenge sunflower oil plant, dairy and poultry projects, and a brick plant—while construction output hit 4.1 trn tenge in 1H 2026.

Rare Earths Control: Lindian Resources moved to full ownership of Kazakhstan’s SARECO mixed rare earths processing facility in Stepnogorsk, securing 100% downstream margins and exclusive marketing rights as it targets first processing in Q4 2026. Oil & Gas Localization: Kazakhstan is tightening rules to raise Kazakh content in oil and gas procurement, setting minimum local value requirements (50% for works/services, 80% for design) and using five-year programs with Tengiz, Karachaganak and Kashagan operators. Export Route Risk: With CPC disruptions tied to Black Sea security, Kazakhstan is considering higher transit via Azerbaijan, including BTC and Baku-Supsa, while Ukraine agreed to halt attacks on non-Russian tankers and CPC-linked infrastructure after US pressure. Construction Momentum: New industrial and social facilities were commissioned nationwide, while construction output hit 4.1 trn tenge in 1H 2026 (+15.2%), supported by the new Construction Code. Aviation Tech: EHang’s EH216-S completed Central Asia’s first pilotless human-carrying eVTOL flight in Astana during the Games of the Future. Critical Minerals Focus: A week of coverage also highlighted the global scramble for minerals and Kazakhstan’s role in the supply chain. Creative Industries Boost: Comic Con Astana drew a record 76,000 visitors across venues, underlining growth in Kazakhstan’s event and media ecosystem.

Oil & Shipping Risk: Shipbroker Gibson says repeated drone strikes around the Caspian Pipeline Consortium (CPC) and Black Sea tankers have disrupted Kazakh crude exports, with July loadings down to ~1.3 mbd (from ~1.9 mbd in May) and August flows still slipping. Black Sea Transit Watch: Turkey denies it has blocked shipping through the Bosphorus/Dardanelles, but reports say it has started restricting some Novorossiysk-bound vessels’ transit permits—raising uncertainty for CPC-linked routes. Deal on CPC Protection: Bloomberg reports the U.S. persuaded Ukraine to avoid attacks on CPC infrastructure and certain non-sanctioned tankers, with special contact points for vessel coordination. AI Infrastructure Push: Kazakhstan’s Deputy PM attended Firebird’s launch of the CIS’s largest AI factory in Armenia; Firebird plans to scale across Armenia and Kazakhstan toward a 2GW network, with Kazakhstan also advancing fiber links for data routes. Biotech Strategy: Kazakhstan will develop a 2036 Biotechnology Strategy, aiming to move from isolated research to applied diagnostics, treatment, and production. Agriculture Tech Links: Tajikistan is looking to Kazakhstan’s advanced irrigation technologies as it upgrades land reclamation and water management.

AI Infrastructure Deal: Firebird officially opened its CIS’s largest AI factory in Hrazdan, Armenia, with Kazakhstan’s Deputy PM Zhaslan Madiyev in attendance; the project is built with NVIDIA and aims to deploy large-scale GPU capacity and expand an AI infrastructure platform across Armenia and Kazakhstan. Energy & Exports Security: Bloomberg reports the U.S. persuaded Ukraine to stop attacks on Caspian Pipeline Consortium (CPC) infrastructure and non-Russian tankers in the Black Sea, with dedicated contact points for safer shipping—key for Kazakhstan oil exports. Critical Minerals Finance: Kazakhstan is in talks to return to China’s yuan “panda bonds,” targeting about $500M to diversify funding and support the budget deficit. Uranium Output: Kazatomprom says H1 2026 uranium production rose 9% year-on-year to 13,291 tonnes. Plant Genetic Conservation: Kazakhstan and Japan collected rare wild plant seeds on an eight-day North Kazakhstan expedition for storage in a genetic bank and DNA analysis to develop climate- and disease-resistant varieties. Retail Logistics: Wildberries plans new Kazakhstan warehouses totaling 260,000+ sq m in Astana and Almaty, with operations targeted for Q1 2027.

AI Infrastructure & Investment: Firebird AI officially opened its CIS’s largest NVIDIA DSX AI factory in Hrazdan, Armenia, with Kazakhstan’s Deputy PM Zhaslan Madiyev attending; NVIDIA CEO Jensen Huang said Firebird plans to deploy 250 MW of AI infrastructure across Armenia and Kazakhstan in the next 12 months, aiming to serve researchers, startups, industry and government, with NVIDIA also signaling further investment. Energy Security for Kazakhstan Exports: Ukraine agreed to halt attacks on non-Russian oil tankers and Black Sea infrastructure tied to the Caspian Pipeline Consortium (CPC) after US-brokered talks, setting up dedicated communication channels for safe passage—key for Kazakhstan since CPC is a main export route. Regional Water Management: Central Asian states approved a plan to automate Syrdarya water accounting for the 2026 growing season and discussed limits for Syrdarya/Amudarya basins, with a working group due by September. Agriculture & Food Industry: Kazakhstan launched a new phase to revive the iconic aport apple, expanding orchards and specialized nurseries to restore commercial production in suitable foothill zones. BRICS Cultural Cooperation: BRICS culture ministers in Bhopal adopted the Bhopal Declaration, pushing cooperation in cultural and creative industries and heritage work, including AI-based tracing tools and digital market access.

Oil Export Security: Ukraine agreed with the US to avoid strikes on certain non-Russian tankers and on CPC infrastructure tied to Kazakh crude exports, aiming to keep loadings moving despite recent Black Sea disruptions. Energy Storage Flexibility: KazMunayGas says it will use and expand tank farms and refinery tanks to buffer against possible oil transport disruptions, prioritizing system flexibility over new standalone tank projects. Water Tech for Industry: Central Asian states approved a plan to automate Syrdarya water accounting, with a working group to be formed by September, supporting more reliable water management for agriculture and power. Aport Revival: Kazakhstan launched a new phase to revive the iconic aport apple via expanded orchards and specialized nurseries, targeting commercial planting material for a variety that needs specific foothill conditions. Autonomous Air Taxis: Kazakhstan completed a first passenger flight on an eVTOL aircraft in Astana, moving toward practical urban air mobility with planned vertiports in Astana, Almaty and Alatau City. Mining Pipeline: Kazakhstan plans to start tungsten mining at the Aksoran deposit in 2028, with underground extraction and a processing plant scheduled for the same year. Agri-Exports: Kazakhstan’s wheat flour exports are forecast to hit a multi-year high, with Afghanistan driving demand and helping mills capture more value than raw wheat sales. Digital Integration: EAEU trade is on track to surpass $100bn in 2026 as leaders push digital trade and reduce non-tariff barriers, with Kazakhstan expecting continued gains within the bloc.