Central Asia these days is frequently associated with shortages in a bad way – shortages of heat and electricity, of jobs and, perhaps most alarmingly, of water. But there is at least one deficit in Central Asia that can be seen as a favorable development – a shortage of warehouse space.
The shortage of available storage space means that demand is high and trade is expanding. It also means warehousing costs in Uzbekistan and Kazakhstan are higher than in Dubai and most other seaport-based transit hubs. A report published by the Uzdaily outlet, citing a local logistics expert, notes the average rental rate for warehousing exceeds $150 per square meter per year in Tashkent and Almaty. Meanwhile, rates in Kyrgyzstan average about $114 per square meter per year, a cost comparable to that found in many European Union locations.
Interest in expanding the so-called Middle Corridor trade route connecting Asia and Europe via Central Asia has risen rapidly since the Kremlin launched its unprovoked attack on Ukraine in 2022: sanctions have greatly diminished interest in Russia’s Northern Corridor trade route. A US-sponsored trade framework for Central Asia, dubbed the B5+1, is helping to generate trade momentum in the region and, potentially, foreign investment.
The warehousing shortage is encouraging a construction boom. But the Uzdaily report states that the rush to build runs the risk of creating a glut. It also notes that construction of associated infrastructure, such as road improvements, currently lag behind efforts to create more storage space.
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