HomeNewsUzbekistan aims to achieve a chemical hub status with the help of Chinese polymer tech

Uzbekistan aims to achieve a chemical hub status with the help of Chinese polymer tech

4/15/2024

Original posted on https://asia.nikkei.com/

Uzbekistan is embarking on a significant economic transformation with the help of Chinese technology, aiming to capitalize on its natural gas reserves by producing value-added products rather than solely relying on energy consumption.

At the forefront of this effort is the collaboration between Uzbekistan's largest private oil and gas company, Saneg, and Chinese state energy giant Sinopec, to establish the world's first methanol-to-olefin gas chemical plant outside China. This $3.3 billion facility is expected to annually convert 1.3 billion cubic meters of natural gas into 1.11 million tons of polymers by 2026, with a substantial portion of the output slated for export to China and Turkey.

The project not only underscores the strengthening ties between Uzbekistan and Beijing but also aligns with Uzbek President Shavkat Mirziyoyev's vision to liberalize the economy and promote the production of high-value-added products through resource processing.

Additionally, the development of the Karakul free economic zone, housing factories for various polymer-based products, aims to further stimulate economic growth and reduce Uzbekistan's trade deficit. Despite optimism about the project's potential, challenges such as geographical constraints and transportation costs pose hurdles to its long-term viability, prompting discussions about the need for substantial subsidies and strategies to optimize market access.

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