Trade Friction Between China and Tajikistan: Uzbekistan Warns of Reciprocal Sanctions

On January 17, Uzbek Deputy Prime Minister Jamshid Khojaev publicly stated at a meeting in Tashkent that Uzbekistan might take reciprocal trade measures against Tajikistan. The meeting brought together business leaders, ambassadors, and government officials to discuss countermeasures against trade barriers affecting Uzbekistan's exports to Tajikistan.

Khojaev particularly emphasized the challenges faced by Uzbek exporters in the building materials sector. Despite full compliance with all documentation requirements, goods entering the Tajik market are still subject to a "reservation" procedure, leading to a price increase of approximately 15% in the Tajik market.

01 Root Causes of Trade Friction

The additional fees levied by Tajik customs on Uzbek building materials are the direct cause of this friction. These additional fees significantly increase the cost of Uzbek building materials, weakening their market competitiveness.

At the meeting, Khodjaev warned that if Tajikistan did not lift these restrictions, Uzbekistan would respond with similar trade measures. He stated explicitly, "If they impose tariffs, we can do the same."

The "retention" of customs clearance procedures is considered a major reason for increased costs. According to a representative of the German building materials giant Knauf, this procedure exists not only in Tajikistan but also in Turkmenistan and parts of the Caucasus.

Khodjaev announced that Uzbek customs officials would communicate with Tajikistan, and if the situation persists, Uzbekistan will take countermeasures. He instructed the ambassador to clearly convey this message.

02 Economic Impact and Business Dilemmas

The actual impact of trade barriers on businesses is already significant. Entrepreneurs report that the total cost of logistics and customs for goods shipped to Tajikistan has soared from approximately $2,000 to $12,000.

Despite numerous appeals to the Tajik authorities, the problem remains unresolved. High costs are significantly weakening Uzbekistan's exports, impacting normal trade between the two countries.

A representative from the German company Knauf pointed out that "retaining" customs clearance procedures has led to a price increase of up to 15% for their products in the Tajik market. This figure is largely consistent with the impact reported by Uzbekistan.

Ironically, in early 2024, Uzbekistan raised customs clearance fees for imported Tajik cement from $35/ton to $300/ton. This measure is believed to have been driven by Uzbek cement manufacturers.

03 The Complexities of Bilateral Trade

Despite trade frictions, trade between Uzbekistan and Tajikistan still exceeded $700 million in 2024, almost three times the figure of previous years.

Tajikistan holds a significant position in Uzbekistan's foreign trade landscape. Data shows that since 2018, Tajikistan has ranked fifth in Uzbekistan's total foreign trade volume. Over the past six years, Tajikistan's exports to Uzbekistan have increased from $132 million in 2018 to $353 million in 2023.

Tajikistan has 15 cement plants with a total capacity of 5.5 million tons. From January to September 2024, Tajikistan's total cement exports were approximately 532,000 tons, of which about 43% (over 230,000 tons) went to Uzbekistan.

In contrast, Uzbekistan currently has 30 cement manufacturing enterprises, and many plants are under construction or undergoing modernization. Once these plants are completed and operational, it could lead to a complete ban on cement imports by Uzbekistan.

04 Regional Economic Integration Background

This trade friction occurs against the backdrop of accelerated economic integration in Central Asia. In 2024, the five Central Asian countries signed the "Framework Agreement on Unified Customs Procedures in Central Asia," aiming to unify customs clearance mechanisms, cross-border payments, and railway networks.

This agreement lays the foundation for facilitating trade and investment between China and Central Asian countries. With the advancement of unified customs procedures, trade and investment between China and Central Asian countries will become more convenient, and regional economic cooperation is expected to deepen.

Meanwhile, connectivity construction between China and Central Asian countries is accelerating. In particular, the launch of the China-Kyrgyzstan-Uzbekistan railway project will connect Central Asia with East Asia and European markets, significantly shortening transportation time and distance, and enhancing regional integration.

Uzbekistan's Deputy Prime Minister Khozaev has publicly stated that Uzbekistan appreciates China's efforts in strengthening regional connectivity. China is Uzbekistan's largest trading partner and a major source of investment.

05 Future Directions and Solutions

Both governments have indicated they are exploring new logistics channels and simplifying customs procedures to deepen bilateral economic ties. This high-level communication mechanism may provide a platform for resolving trade barriers.

In the long term, the unification of customs procedures and standards in Central Asia will help reduce such trade frictions. With the signing of the Framework Agreement on Unified Customs Procedures in Central Asia, the five Central Asian countries have taken significant steps towards unified customs clearance mechanisms, cross-border payments, and railway networks.

China's trade facilitation measures with Central Asian countries will also promote regional cooperation. For example, China has signed visa exemption agreements with Kazakhstan and Uzbekistan, measures that will bring more opportunities for regional cooperation.

At the micro level, businesses also need to adapt to the different customs policies of various countries. For example, Uzbekistan has specific certification requirements for certain machinery products, while Tajikistan requires English documents to be notarized in Russian.

Digital reform may be key to improving customs clearance efficiency. By 2025, Kazakhstan's "e-Customs" system was fully implemented, allowing for faster processing of electronic customs declarations, with some goods even achieving "same-day declaration, next-day release."

By 2024, bilateral trade between Uzbekistan and Tajikistan exceeded $700 million, three times that of previous years. While exploring new logistics channels and simplifying customs procedures, the two countries are also redefining the art of economic balance in Central Asia.

The process of regional economic integration continues. The framework agreement on unified customs procedures signed by the five Central Asian countries in 2024, along with the construction of the China-Kyrgyzstan-Uzbekistan railway, foreshadows a profound transformation in the Central Asian supply chain landscape.

At the Tashkent meeting, Deputy Prime Minister Khodjaev's statement was both a response to specific trade frictions and a reflection of the efforts of Central Asian countries to adjust their positioning within a larger context: "Our customs officials will communicate with the other side. If this continues, we will take countermeasures."