BAKU, Azerbaijan, March 27. Middle Corridor drives Azerbaijan’s logistics sector expansion, says the latest analysis from Moody’s, Trend reports.
“Across the CIS region, countries are gradually growing and diversifying their economies. Oil exporters, Azerbaijan and Kazakhstan, have been reducing their dependence on the hydrocarbon sector, shown by the rising share of non-oil sectors in their economies compared to a decade ago. For both countries, for example, the transportation and logistics sector has expanded, driven by rapid growth in cargo transit activity across the Trans-Caspian International Trade Route, also known as the Middle Corridor,” reads the report.
Moody’s analysts note that CIS countries' participation in global value chains has increased as more global trade is routed through the region. Azerbaijan, Kazakhstan and Uzbekistan have increased their use of foreign inputs in their manufacturing production, according to IMF research and are benefiting from their new position in global trade and production amid Russia's shrinking contribution.
“These governments have pursued extensive national programs to grow and diversify their economies and improve competition, supported by institutional reform and prolific government spending. At the same time, they have encouraged the private sector to share the financial burden through new investment opportunities. As a result, local banks and development institutions are gradually increasing their appetite for long-term international borrowing,” the report says.
The Middle Corridor is a transportation and trade route that connects Asia and Europe, passing through several countries in the region. It is an alternative route to the traditional Northern Corridor and Southern Corridor. The route starts in China and crosses Central Asian countries such as Kazakhstan, Uzbekistan, and Turkmenistan. It then passes through the Caspian Sea, Azerbaijan, Georgia, and Türkiye before reaching Europe. The Middle Corridor offers a land route that connects the eastern parts of Asia, including China, with Europe, bypassing the longer maritime routes.