ABSTRACT
With the increased geo-political attention given to Central Asia in the aftermath of 9/11, the question of these economies’ future economic prospects has also received rising interest. The economies of the five Central Asian countries depend heavily on their primary sectors. Their integration into the world economy has remained incomplete and geared mainly towards the exploitation of their natural resource endowments. Both economic diversification and better outlets for the region’s natural resources remain key challenges. While the topic of improved transport infrastructure for natural resources out of the region has been widely discussed in the literature, less attention has been given to the regional aspects of integration. Also, we concentrate on Central Asia rather than the Caucasus.1 Market access for manufactured products from Central Asia is naturally hampered by high transportation costs linked to the region’s relative geographical isolation. Given this constraint several observers have pointed towards increased regional cooperation and enhanced regional trade as central elements of a future sustainable development strategy.
