Expanding Bilateral Economic Cooperation
South Korea Pledges New Funds to Expand Regional Partnerships with Uzbekistan
Anonymous
Key Points
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Uzbekistan is South Korea’s largest recipient of Economic Development Cooperation Fund support in Central Asia, accounting for about 86% of regional approvals. A 2024 framework agreement allows up to $2 billion in EDCF loans to Uzbekistan through 2027.
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Existing bilateral cooperation also includes Hyundai Rotem’s work on high-speed trains and Incheon Airport’s involvement in airport development in Uzbekistan.
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The Supply Chain Stabilization Fund, launched in 2024 and administered by Korea Eximbank, is intended to support South Korean companies operating in industries considered vital to stable supply chains.
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The Namangan delegation visited Seongnam to examine the city’s smart-city policies and advanced industrial base, while Seongnam officials said cooperation should extend beyond municipal ties to include regional-level economic, industrial, cultural, educational and people-to-people exchanges.
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Seongnam residents urged officials to turn the Namangan relationship into practical outcomes, such as business exchanges and youth education programs, rather than limiting it to ceremonial visits and photo opportunities.
South Korea is deepening ties with Uzbekistan through local government partnerships and business investment, pledging billions in financing to support regional development. At a Seoul forum ahead of the inaugural Korea-Central Asia Summit, South Korean Deputy Prime Minister Koo Yun-cheol announced policy funding including the Economic Development Cooperation Fund and Supply Chain Stabilization Fund to back viable projects Korea Eximbank. Uzbekistan, home to over 700 Korean-capital companies and nearly $8 billion in Korean investment, is now South Korea's largest development finance recipient in Central Asia, accounting for roughly 86% of regional approvals.
Uzbek Deputy Prime Minister Jamshid Khodjaev called for Korean investment in critical minerals, digital technology, transport and agriculture, citing bilateral trade of nearly $2 billion with a $5 billion target. The expansion reflects both nations' desire to move beyond symbolic exchanges toward concrete economic outcomes, with local officials stressing the need for tangible business deals and education programs rather than ceremonial visits.
Seoul Summit Launches Regional Financing Push
South Korea's Deputy Prime Minister Koo Yun-cheol pledged active policy financing at the September 2026 Uzbekistan-Korea Interregional Cooperation Forum in Seoul. The EDCF, administered by Korea Eximbank, now caps at $2 billion through 2027 following a June 2024 framework agreement. The Supply Chain Stabilization Fund, launched in 2024, supports Korean companies in vital industries. Koo called balanced regional development a "survival strategy" for South Korea as global economies shift.
Nine of Uzbekistan's 14 regional divisions sent delegations to Seoul. The forum bridged municipal diplomacy with commercial investment, bringing local governors face-to-face with Korean mayors and business leaders. Park Chan-dae, president of Korea's Governors Association and mayor of Incheon, co-hosted discussions to connect city-level partnerships with larger supply chain cooperation.
Existing Partnerships Span Energy, Rail and Agriculture
South Korea already operates multiple regional projects across Uzbekistan. Hyundai Rotem is developing high-speed trains, while Incheon Airport is involved in airport expansion. Special economic zones link Incheon with Fergana, workforce partnerships connect South Gyeongsang Province and Tashkent, and smart-agriculture initiatives tie South Chungcheong and Namangan together. These models demonstrate how Korean technical expertise and capital combine with Uzbek resources and labor.
Namangan Governor Shavkat Abdurasakov visited Seongnam in September to study smart-city policies and advanced industry development. Both officials pledged to expand cooperation beyond ceremonial ties into smart cities, advanced tech, education and culture. Seongnam residents pressed their mayor to deliver concrete results: business exchanges, youth education programs and measurable economic gains rather than photo-op diplomacy.
Critical Minerals and Supply Chain Security Drive Strategy
South Korea views Uzbekistan as essential for supply chain resilience in raw materials and semiconductors. Khodjaev stressed Korean businesses must expand in critical minerals, digital tech, transport and agriculture to hit the $5 billion trade target from the current $2 billion baseline. A Korea-Uzbekistan Rare Metals Center is planned to streamline access to mineral processing for EV batteries and chip production.
Analysts frame the partnership as part of South Korea's broader Middle Corridor strategy—building supply chains that bypass geopolitical vulnerabilities in Eastern Europe and East Asia. Seoul's subsidized financing via Korea Eximbank lowers investment risk for Korean firms entering Central Asia, particularly in infrastructure and high-tech sectors where Seoul seeks long-term resource security.
Local Officials Push for Real Economic Outcomes
Seongnam Mayor Shin Sang-jin and Namangan Governor Shavkat Abdurasakov stressed that bilateral ties must produce measurable results. Both sides emphasized moving beyond ceremonial exchanges to build regional-level economic, industrial, cultural and educational partnerships. Public sentiment in Korean municipalities reflects this demand: residents want youth education programs and business deals, not just official visits.
Implementation now shifts to local authorities following the Seoul summit. City-to-city projects like the Incheon-Fergana special economic zones and South Chungcheong-Namangan agricultural hubs will drive concrete development. This sub-national diplomacy model sets a precedent for South Korea's broader Central Asia strategy, embedding economic cooperation directly into regional governance rather than limiting it to national treaties.
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