Middle Corridor boom triggers ADB’s $10 bln infrastructure push |
There is a figure hidden within an ADB research paper that needs to be highlighted and understood. Based on IMF gravity model calculations, as pointed out by the bank itself, the Caucasus and Central Asia are trading between 15%-20% lower than they should, with intra-regional trade lagging by around 14%. This figure, which remains hidden from almost all discourse regarding the development of this region, represents the goal that the $10 billion CAREC investment package from the Asian Development Bank, unveiled during the 59th Annual Meeting of its Board of Governors held in Samarkand, aims to achieve. ADB President Masato Kanda was clear in his statement, saying that "regional integration is a catalyst for growth in these regions, allowing them to collectively withstand any external shocks."
This $10 billion investment program covering connectivity, clean energy, digital transformation, and inclusive infrastructure over the next decade is ADB's largest single programmatic commitment to CAREC in the history of the CAREC Program over 25 years. This builds on the successful track record of CAREC: since its establishment in 2001, over $54 billion in projects have been completed under the CAREC Program, with ADB playing an instrumental role as its secretariat and lead financing agency. However, the 2026 program differs substantially from its predecessors in terms of its scope and approach. While the initial decades of the CAREC Program were devoted to building physical transport corridors, the 2026 program emphasizes three pillars of transformation that better suit the current phase of economic development in the region.
This billion dollars of commitment does not generate the momentum of the Middle Corridor, rather, it comes as a result of it. In 2022, Russia invaded Ukraine, and as a result, the Northern Corridor, the land route........