Azerbaijan Promotes Caucasus Corridors to Link Saudi Logistics With Central Asia

Azerbaijan's ambassador in Riyadh told Asharq Al-Awsat that new agreements are being developed and praised ACWA Power's projects in his country.

Azerbaijan's capital Baku with the city's famous architectural landmarks in the background (X)
Azerbaijan's capital Baku with the city's famous architectural landmarks in the background (X)
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Azerbaijan Promotes Caucasus Corridors to Link Saudi Logistics With Central Asia

Azerbaijan's capital Baku with the city's famous architectural landmarks in the background (X)
Azerbaijan's capital Baku with the city's famous architectural landmarks in the background (X)

As global markets search for logistical lifelines to secure supply chains and energy flows amid ongoing geopolitical disruptions, Azerbaijan is promoting major transport and logistics projects, foremost among them overland freight routes through the Caucasus and across the Caspian Sea, as a strategic safeguard for the future. These initiatives aim to create faster and more efficient shipping links while integrating the Gulf Cooperation Council states, particularly Saudi Arabia's logistics strategy, into a vital connectivity network stretching across the South Caucasus and deep into Central Asia.

Ahead of his country's Independence Day on May 28, Azerbaijan's Ambassador to Saudi Arabia Mutallim Mirzayev told Asharq Al-Awsat that Baku is leveraging its unique position as a strategic bridge to strengthen investment flows and trade, driven by a strong desire to deepen its comprehensive partnership with Riyadh and translate existing understandings into concrete projects on the ground. These include nearly 30 official agreements and important contracts covering the economy, trade, investment, and agriculture, in addition to a proposed joint investment fund. Mirzayev stressed that Azerbaijan is "uniquely positioned as a strategic bridge connecting Central Asia, the South Caucasus, and the Gulf region."

These logistics ambitions come at a time when Saudi-Azerbaijani relations are experiencing a peak in investment activity, with the two countries pursuing major strategic partnerships in both conventional and renewable energy sectors. In this regard, the ambassador praised the leading role played by Saudi companies in Azerbaijan, particularly ACWA Power, which he described as a vital partner driving the country's green energy transition, water management projects, and sustainable infrastructure development. He noted that cooperation is expanding rapidly, reflecting the peak level of investment activity between the two nations.

A key example is the Khizi-Absheron Wind Power Plant, officially inaugurated by Saudi Arabia's ACWA Power earlier this year. The project has a generation capacity of 240 megawatts and an investment value of $300 million. It is the first and largest fully foreign-funded renewable energy project in Azerbaijan and is expected to contribute significantly to the country's energy security.

In conventional energy, Saudi investments also maintain a significant presence through the participation of companies affiliated with the Kingdom's sovereign and development institutions in strategic oil and gas projects in Azerbaijan. These include contributions to the development of the giant Azeri-Chirag-Gunashli oil field, reinforcing the role of both countries in regional and international energy security.

Mutallim Mirzayev, Azerbaijan's ambassador to Saudi Arabia. (Asharq Al-Awsat)

Urban Momentum and the Joint Fund

Mirzayev praised Saudi Arabia's active, high-level participation in the 13th session of the World Urban Forum (WUF13), hosted recently in Baku. The forum featured leading Saudi initiatives and projects in urban development and sustainable housing, reflecting the growing depth of bilateral coordination.

The Azerbaijani ambassador noted that the forum successfully transformed Baku into a global platform for dialogue on the future of smart cities, modern urban planning, and climate resilience. He said these strategic principles are fully embedded in Azerbaijan's ongoing reconstruction and redevelopment plans, under which entire cities and villages are being rebuilt in the liberated territories.

Trade Momentum and the Joint Fund

Turning to economic cooperation, Mirzayev said efforts are advancing steadily to activate the proposal for a joint investment fund aimed at pooling capital and directing it toward priority sectors and shared economic objectives, including agriculture, food security, tourism, advanced technologies, and infrastructure, as well as strengthening trade in industry and advanced logistics services.

On people-to-people ties, he said tourism has become a key pillar of growth amid increasing visitor flows and growing interest among Saudi tourists in Azerbaijan as a distinctive cultural and tourism destination.

The official inauguration of the Khizi-Absheron Wind Power Plant, developed by ACWA Power, in January 2026. (X)

Vision 2030 and the Organization of Islamic Cooperation

"On the occasion of our Independence Day, I would like to express my sincere appreciation for the friendship, solidarity, and close cooperation between our two countries," Mirzayev said. He also praised the remarkable achievements and transformation witnessed in the Kingdom, noting that "the ambitious reforms and development initiatives implemented within the framework of Saudi Vision 2030 are making significant contributions to sustainable development, economic diversification, regional stability, and prosperity."

He added that Azerbaijan "highly values the Kingdom's principled support for Azerbaijan's sovereignty," while emphasizing that Baku attaches great importance to its relations with Saudi Arabia as one of the leading countries in the region. He reiterated Azerbaijan's future-oriented vision, highlighting the country's ongoing large-scale reconstruction and redevelopment efforts in the liberated territories, where entire cities and villages are being rebuilt in accordance with modern urban planning principles, smart city concepts, green energy, and sustainable development.

In the multilateral arena, Mirzayev revealed that Azerbaijan's upcoming chairmanship of the Organization of Islamic Cooperation summit will focus heavily on strengthening economic cooperation among member states, supporting climate action, science and innovation, youth empowerment, and sustainable development, all in the service of global stability.

He also reiterated that tourism has become an increasingly important pillar of bilateral relations, driven by the growing number of Saudi visitors traveling to Azerbaijan.

A view of Baku illuminated at night. (X)

The Geopolitics of the Middle Corridor and Shipping Alternatives

Azerbaijan's transport and logistics proposals are gaining strategic significance in economic circles. At the center of these plans is the Middle Corridor, officially known as the Trans-Caspian International Transport Route, which serves as a secure land-and-sea alternative connecting China with Central Asia, the Caucasus, Türkiye, and ultimately Europe. The corridor is particularly attractive because it can reduce cargo transit times to approximately 12 to 15 days, bypassing the constraints of traditional maritime shipping and the geopolitical complications associated with northern transport routes.

In the same logistics framework, the planned Zangazur Corridor, which would connect mainland Azerbaijan with the Nakhchivan Autonomous Republic and onward to Türkiye, represents a vital artery for regional economic integration. The corridor would establish direct and rapid road and rail connectivity and intersect with the Middle Corridor, creating an extensive logistics network stretching from the Turkic world and Central Asia to the ambitious transport systems being developed by the Gulf Cooperation Council states.

Shaping the Logistics Map

Regarding regional integration between the Gulf and Central Asia, Mirzayev emphasized that Azerbaijan's strategic location makes it a vital link connecting Central Asia, the South Caucasus, and the Gulf region. This geographical advantage is reinforced by modern transport infrastructure that enables Azerbaijan to facilitate trade, investment, and energy flows between the two regions in the face of global economic challenges.

The ambassador stressed that regional cooperation mechanisms are becoming increasingly important in addressing current global economic and geopolitical challenges, adding that Azerbaijan actively supports all initiatives aimed at strengthening integration, connectivity, and economic partnership between Central Asia and the Gulf region.

In this context, Mirzayev said major transport projects, particularly the Middle Corridor and the Zangazur Corridor, carry exceptional strategic weight for regional transportation, logistics services, international trade, and cross-border economic integration. Their ability to create faster, safer, and more efficient land and rail shipping links connecting Central Asia, the South Caucasus, and Türkiye with the Gulf region can strengthen global supply-chain security and open promising investment opportunities for all parties, including Saudi Arabia's logistics strategy as it seeks to diversify its gateways to the world.



EU's Side of US Trade Deal to Come Into Force on July 1

FILED - 03 June 2024, Berlin: FILE PHOTO - The European Union flag flies in the wind. Photo: Sebastian Gollnow/dpa
FILED - 03 June 2024, Berlin: FILE PHOTO - The European Union flag flies in the wind. Photo: Sebastian Gollnow/dpa
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EU's Side of US Trade Deal to Come Into Force on July 1

FILED - 03 June 2024, Berlin: FILE PHOTO - The European Union flag flies in the wind. Photo: Sebastian Gollnow/dpa
FILED - 03 June 2024, Berlin: FILE PHOTO - The European Union flag flies in the wind. Photo: Sebastian Gollnow/dpa

The European Union's side of a trade deal struck with the United States last year, which will remove import duties on many US goods, will come into force on July 1, said a formal European Union regulatory filing.

The EU said this ⁠regulation would apply ⁠from July 1 until December 31, 2029, Reuters reported.

"Where appropriate, the Commission shall submit together with the comprehensive assessment a legislative proposal to extend ⁠the period of application of this Regulation," added the regulatory filing.

Under the agreement, the EU agreed to remove import duties on US industrial goods and provide preferential access to US farm produce.

It will also extend duty-free imports of ⁠US lobster, ⁠a mini-deal struck with Trump during his first term as president.

The EU legislation expires at the end of 2029 and includes multiple safeguards that would allow the EU to suspend concessions if the United States breaches the trade deal's terms.


Saudi Real Estate Developers Move to Capitalize on New Foreign Ownership Rules

A general view of buildings and homes in the Saudi capital, Riyadh (File photo: Reuters)
A general view of buildings and homes in the Saudi capital, Riyadh (File photo: Reuters)
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Saudi Real Estate Developers Move to Capitalize on New Foreign Ownership Rules

A general view of buildings and homes in the Saudi capital, Riyadh (File photo: Reuters)
A general view of buildings and homes in the Saudi capital, Riyadh (File photo: Reuters)

Saudi Arabia's real estate market has entered a new phase of testing the practical impact of the executive regulations governing property ownership by non-Saudis, as listed developers move swiftly beyond welcoming the decision and the initial positive market reaction to translating it into strategic growth plans.

While the sector index has extended its early gains on expectations that the new rules will broaden international demand, the competitive advantage is beginning to shift toward companies with high-quality assets that are ready to be marketed and sold.

The real estate index on the Saudi stock market posted a sharp gain following the announcement, rising from 2,924 points to 3,044 points. The increase was driven by investor expectations that allowing non-Saudis to own property under specific regulations would expand demand for Saudi real estate assets, particularly in cities and projects with strong investment and religious appeal.

Real estate stocks led the market's gainers in the session following the announcement. Shares of Umm Al Qura for Development and Construction (Masar) hit the daily 10 percent limit, while Knowledge Economic City rose about 9.3 percent. Jabal Omar Development, Retal, Emaar The Economic City, and Makkah Construction and Development also posted strong gains.

Financial and economic adviser Dr. Hussein Al Attas told Asharq Al-Awsat that allowing non-Saudis to own property represents an important structural shift for Saudi Arabia's real estate market, but said the impact will not be uniform across all developers. Instead, the market will increasingly differentiate between companies with attractive assets and projects in locations targeted by international investors and those without them.

Master plan of the Masar Makkah destination (Masar)

He added that asset quality, location, financial strength, the size of developable land holdings, and the ability to attract international investors will be among the key factors determining how much companies benefit from the decision in the coming period.

Al Attas expects the sector to perform positively over the medium to long term. However, he said the real impact of the decision will ultimately be measured by companies' ability to turn this opening into actual sales, partnerships, and cash flows, rather than by the initial rise in share prices following the announcement.

In the first concrete move by a listed company since the regulations were approved, Jabal Omar Development on Sunday outlined its strategy for capitalizing on the decision after its project in Makkah was included within the geographic areas where non-Saudis are permitted to own property.

The company said the decision would broaden its base of potential investors and property owners among Muslims around the world, supporting demand for its real estate assets. It also announced plans to offer 400 existing hotel residential units for sale this year as the first phase of the program, with the proceeds earmarked to reduce debt and lower financing costs.

The company also plans to redesign the seventh and final phase of the project by increasing the number of hotel residential units available for sale while making greater use of off-plan sales programs to reduce financing requirements and strengthen reliance on internally generated liquidity.

Al Attas said the market's response to the regulations has unfolded in two stages. The first was a broad wave of optimism that lifted most real estate companies. The second has begun as investors seek to identify the companies best positioned to convert the decision into tangible growth in sales, cash flow, and profitability.

The decision to allow non-Saudis to own property forms part of a broader package of measures introduced by the Kingdom in recent months to restore balance to the real estate market and strengthen its investment appeal.

These measures include allowing the sale, purchase, and development of land in new areas north of Riyadh, increasing fees on undeveloped land, imposing fees on vacant properties, and freezing annual rent increases in Riyadh for five years.

The decision also coincides with signs of improving real estate and construction activity across the Kingdom. The construction sector returned to growth in May, supported by stronger residential building activity and renewed growth in new orders.

Although the full impact of the regulations will take time to emerge, recent moves by real estate developers indicate that the market has already begun shifting from expectations to execution as companies seek to attract a new segment of investors and buyers from outside the Kingdom.


China Imposes New Export Controls, Deepening Japan Row

FILE PHOTO: A China yuan banknote featuring late Chinese chairman Mao Zedong and a computer keyboard are seen reflected on an image of Chinese flag in this illustration picture taken November 1, 2019.  REUTERS/Florence Lo/Illustration/File Photo
FILE PHOTO: A China yuan banknote featuring late Chinese chairman Mao Zedong and a computer keyboard are seen reflected on an image of Chinese flag in this illustration picture taken November 1, 2019. REUTERS/Florence Lo/Illustration/File Photo
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China Imposes New Export Controls, Deepening Japan Row

FILE PHOTO: A China yuan banknote featuring late Chinese chairman Mao Zedong and a computer keyboard are seen reflected on an image of Chinese flag in this illustration picture taken November 1, 2019.  REUTERS/Florence Lo/Illustration/File Photo
FILE PHOTO: A China yuan banknote featuring late Chinese chairman Mao Zedong and a computer keyboard are seen reflected on an image of Chinese flag in this illustration picture taken November 1, 2019. REUTERS/Florence Lo/Illustration/File Photo

China put 20 more Japanese organizations on a blacklist Monday over the export of items with both military and civilian possible uses, adding fuel to a months-long row with Tokyo.

The new additions, including major companies, "have participated in enhancing Japan's military capabilities", the Chinese commerce ministry said in a statement.

Japan's government spokesman Minoru Kihara called the measures "unacceptable and deeply regrettable" and said Tokyo had "lodged a strong protest and demanded that the measures be withdrawn."

The countries' have been at row since Japanese Prime Minister Sanae Takaichi suggested in November that Tokyo may react militarily to an attack on Taiwan, the self-ruled island Beijing has vowed to seize control by force if necessary.

China responded furiously, including by advising its citizens -- previously the biggest cohort of foreign tourists -- to avoid Japan.

Chinese authorities ramped up pressure in February by imposing export restrictions on dozens of Japanese firms it said were involved in building up Tokyo's military.

The 20 additions to the export blacklist named Monday include specialized subsidiaries and technology firms involved in supplying components and engineering support for Japan's defense sector.

Among them are the National Institute for Defense Studies and Mitsubishi Electric Defense and Space Technologies Corporation, the statement said.

China's commerce ministry said the controls require exporters to submit risk assessments and guarantees that dual-use items will not enhance Japanese military strength prior to making shipments.

Those named on the watchlist can apply to be removed by cooperating with "verification" procedures according to Chinese law, the ministry said.

China is the world's largest producer and refiner of rare earths, which are crucial for various high-tech products including electric vehicles, smartphones, missile guidance systems and lasers.

Japan has "strayed further down the wrong path, intensifying its push for a 'new form of militarism'", an unnamed commerce ministry spokesperson said in a statement on the latest measures.

- China-Russia patrols -

Since Takaichi took office in October, Japan has quickened its pivot towards a more proactive defense policy, further shaking off -- with US encouragement -- a pacifist outlook, which has been in place since the end of World War II.

Tokyo has loosened rules on exports of lethal weaponry and deepened military cooperation with other countries in the region at odds with China including the Philippines.

Japan and the United States, as well as many other countries, are seeking to curb dependence on China in rare earths, as Beijing increasingly uses its dominance for geopolitical leverage.

Japan on Monday also joined South Korea in criticizing joint flights by Chinese and Russian bombers and fighters over the weekend in the region.

Fellow US allies South Korea and Japan both scrambled fighter jets in response to the patrols by the convoy of around 15 aircraft on Saturday.

"This marks the 10th instance of such long-range activities by Chinese and Russian bombers in the vicinity of Japan since December last year," Japanese government spokesman Kihara said Monday.

Beijing's defense ministry said that the Chinese and Russian air forces conducted a "strategic air patrol" over the Sea of Japan, the East China Sea and the western Pacific Ocean, "demonstrating their determination and capability to jointly uphold regional peace and stability".

Tokyo last week also rejected Beijing's accusations that the Japanese military "harassed" a Chinese aircraft carrier strike group during 40 days of exercises in the Pacific.