After his inauguration ceremony, the re-elected Kazakh president Nursultan Nazarbayev was constantly shuttling between Tashkent and Moscow. The timing of the trip to Uzbekistan could not be better. Islam Karimov, deeply disillusioned with the Americans and rebuked by the West for the Andijon debacle, desperately seeks the renewal of ties with Moscow and Astana. At a joint press conference, Karimov fumed over the growing threat of terrorism and drug trafficking in Central Asia which, in his view, demands an alliance between “traditional partners in foreign policy” led by Russia. The Uzbek leader swallowed his pride and called Nursultan Nazarbayev “a wise leader and a friend”. Not surprisingly, he angrily lashed out at the World Bank which allegedly distorted economic figures on Uzbekistan, presenting the country as a poverty-stricken part of Central Asia with a 32 percent inflation rate and miserable per capita income figures. Nazarbayev softened the tone of his Uzbek friend’s anti-western verbal avalanche, and directed the discussions into down-to-earth economic matters, stressing that imports of Uzbek cement and other construction materials would boost industrial production in Kazakhstan.

There are many obstacles to the implementation of the seven interstate agreements ranging from agricultural cooperation to road communication that were concluded in Tashkent. In 2005, trade turnover made up $500 million, a 15.8 percent increase from 2004’s trade volume, albeit no comparison to the trade between Kazakhstan and China or Russia. Many analysts wonder how the relatively developed market economy of Kazakhstan will form a tandem with Uzbekistan with its snail’s pace of privatization. Astana is increasingly worried about the growing number of Uzbek illegal migrants employed in low-paid jobs in South Kazakhstan. A week before Nazarbayev’s visit to Uzbekistan, Kazakh police deported 50 Uzbeks illegally working at construction sites in Almaty. The demographic boom in densely populated and economically poor Uzbekistan poses a social threat to Kazakhstan. On the other hand, the Uzbek economy, riddled by political instability, is ill positioned to offer resistance to Russian and Kazakh financial and industrial groups eyeing big slices of the Uzbek economic pie. Kazakhstan’s Basis A Corporation made public its plans to privatize Uzbekistan’s cement producing plant, while Russian Vympelkom telecommunications company sets its eyes on the Uzbek cell phone operators Buztel and Unitel. Despite all Islam Karimov’s friendly smiles, Astana suspects that the Uzbek government covertly tries to limit Kazakhstan’s access to the Uzbek economy. A recent presentation on Uzbekistan’s mineral resources in the Aral Sea was attended by Uzbneftegaz, the Korean National Oil Corporation, Russia’s Lukoil Overseas and China’s CNPC. Is it coincidental that Kazakhstan, a next-door oil power, was not invited to this gathering?

One of the major sticking-points in normalizing Kazakh-Uzbek relations is the unsettled border problem. The demarcation process is likely to drag on for an indefinite period of time while frequent shooting incidents along the 2,300 kilometers long border are poisoning relations within communities in border areas with a mixed population. Since 2001, border guard agencies have registered more than 20 border incidents in which local Uzbeks and Kazakhs were involved. The latest event happened on February 24 this year, when Uzbek border guards chased a lorry with suspected contraband flour, and penetrated into the Kazakh village of Konyrat, provoking a skirmish with locals. This is not an isolated case, since truckloads of flour are being smuggled into Uzbekistan day and night bypassing checkpoints. Diesel oil and gasoline are also illegally brought from Uzbekistan. Kazakhkstan’s Ambassador to Uzbekistan, Tleukhan Kabdrashitov, plays down shootings along the border, ascribing these incidents to ‘unskilled and unprofessional approach by border guards to their duties’. His Uzbek counterpart Turdigul Botayorov takes the matter more seriously, saying that so far two countries reached agreements on only 10 border-crossing points.

Most of the areas of cooperation mapped out since the signing of the Agreement on Eternal Friendship on October 31 1998, are beset by a host of hurdles. It is not yet clear when a water resources consortium of Central Asian states, a project advocated by World Bank, will become a reality. In water management policy, much hinges on relations between Tashkent and Astana. On the eve of Nazarbayev’s visit to Uzbekistan, the Kazakh Electricity Grid Operating Company (KEGOC) claimed that the Uzbek electricity company Uzbekenergo owes $1 million to Kazakhstan.

Yet the thaw in Kazakh-Uzbek relations is easily noticeable. Tashkent dropped its accusations against Astana for ‘sheltering terrorist groups in training camps in South Kazakhstan”, a rhetoric often brandished by Islam Karimov after the March 2004 Tashkent bombings. Uzbekistan agreed to supply South Kazakhstan with relatively cheap gas for $55 per 1000 cubic meters. And finally, Nazarbayev and Karimov made a joint statement of friendship and cooperation. Good neighborly relations between Astana and Tashkent serve the interests of China and Russia, seeking geopolitical counterbalance to American influence in Central Asia. But many aspects of a political rapprochement between Uzbekistan and Kazakhstan are something of a déjà vu. It should be recalled that in January 1994, the two neighbors signed an agreement on setting up a Single Economic Space with nothing to show for it. The practical implementation of agreements reached during Nazarbayev’s visit remains in limbo.