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By imposing unilateral tariffs on Kazakh exports, the United States risks weakening its own access to critical minerals and inadvertently strengthening China’s strategic and economic foothold in Central Asia.
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The United States (US) President Donald Trump has sparked a new global trade dispute by imposing increased tariffs on other nations—including allies—under his “America First” policy. In a letter addressed to Kassym-Jomart Tokayev, the President of Kazakhstan, Trump stated, “Starting on August 1, 2025, we will impose a tariff of only 25% on all Kazakh products imported into the United States, separate from all sectoral tariffs.” Trump added that there will be no tariffs if Kazakh companies decide to build or manufacture products within the US. Asthana has so far not considered retaliatory tariffs, but is waiting for negotiations with Washington. Tokayev responded to Trump’s letter, stating that Kazakhstan remains committed to fair, predictable, and mutually beneficial trade relations with the US and reaffirmed his country’s willingness to engage in dialogue to resolve trade issues.
Trump added that there will be no tariffs if Kazakh companies decide to build or manufacture products within the US.
As Central Asian countries, including Kazakhstan, reshape their foreign policy amid geopolitical, economic, and sovereignty concerns following the Russia-Ukraine conflict that began in 2022, the threat of increased US tariffs on Kazakh imports indirectly paves the way for Beijing to further bolster its regional hegemonic ambitions.
Since 2022, Kazakhstan’s relations with the US have improved significantly, driven by strategic shifts, regional security initiatives, and increased trade and investment in rare earth metals. The war in Ukraine and subsequent sanctions on Moscow limited Kazakhstan’s economic prospects, encouraging Astana to strengthen its trade relations with the European Union (EU) and the US. Moreover, with abundant resources such as uranium, oil, and gas, Kazakhstan attracts numerous US-based investors as Washington seeks to diversify its imports of rare earths. According to the US Trade Representative, in 2024, total trade between the two countries was estimated at US$3.4 billion. US exports totalled approximately US$1.1 billion, representing a 7.2 percent decrease from 2023.
On the other hand, imports worth US$2.3 billion registered a 4.5 percent increase, resulting in a 17.2 percent growth in trade deficit compared to 2023. However, according to the Kazakh Ministry of Trade, in 2024, trade between the two countries totalled approximately US$4.2 billion, with Kazakhstan importing goods worth US$2.2 billion and exporting roughly US$2 billion to the US. The conflicting data presented by both countries for 2024 has not only created confusion about the trade deficit but has also complicated the commodities trade, with Trump deciding to impose a 25 percent tariff on specific goods.
Kazakhstan is diversifying and further enhancing its investment climate by liberalising its economy to promote industrial growth, reduce its reliance on Russia, and counterbalance China’s growing influence in Central Asia.
Holding 14 percent of the world’s uranium reserves, Kazakhstan is the global leader in uranium production. In 2024, Kazakhstan produced approximately 23,270 tonnes of uranium (tU). It is also a major exporter of oil and gas. Main exports from Kazakhstan to the US include crude petroleum, uranium, silver, and other rare-earth metals, which are exempt from the increased tariffs announced by the Trump administration in April 2025. Kazakh officials state that 95 percent of the country’s exports to the US will not be affected by the new tariffs. Approximately 600 US companies currently operate in Kazakhstan, with the US’s total foreign direct investment (FDI) exceeding US$65 billion by the end of 2024. Kazakhstan is diversifying and further enhancing its investment climate by liberalising its economy to promote industrial growth, reduce its reliance on Russia, and counterbalance China’s growing influence in Central Asia.
In September 2023, during the inaugural US-Central Asia Summit, the discussions primarily focused on securing rare earth metals to build sustainable and reliable supply chains for critical minerals and encourage innovation in mining. With curbs on the export of specific minerals and related technologies imposed by Beijing, Washington is looking to reduce its reliance on China for critical minerals by diversifying its import basket.
Beijing controls nearly 60 percent of the world’s rare earth mining and accounts for over 85 percent of the global processing capacity. In this context, Central Asia is increasingly viewed as a potential challenger to China’s monopoly, owing to its abundant reserves of rare earth elements. For example, Kazakhstan alone has over 5,000 rare earth deposits valued at more than US$46 trillion. To attract FDI, the Kazakh government is planning to declassify Soviet-era geological data on these deposits. In February 2024, the US hosted the inaugural C5+1 Critical Minerals Dialogue with all five Central Asian Countries to explore opportunities for American investment in the region’s critical minerals and mining sectors. That same year, Cove Capital, a US-Kazakhstan joint venture, commenced drilling operations and geological exploration in Kazakhstan’s Kostanay Region. Over the past five years, the Kazakh government has ramped up rare earth mineral mining, nearly quintupling its exports in 2024. However, between 2023 and 2024, the bulk of these exports went almost exclusively to China rather than to the US or the EU.
Trump’s decision to impose predatory tariffs on Kazakhstan’s exports to the US will only solidify China’s influence in the region and its critical minerals.
Central Asia has traditionally been under the influence of a cooperative hegemony between Moscow and Beijing. However, Russia’s war in Ukraine has presented resource-rich countries like Kazakhstan with an opportunity to expand their multi-vector diplomacy, involving more countries in the region's strategic resource management. Thus, Trump’s decision to impose predatory tariffs on Kazakhstan’s exports to the US will only solidify China’s influence in the region and its critical minerals. In 2023, the bilateral trade between China and Kazakhstan increased to US$41. 02 billion from US$31.174 billion in 2022, marking a year-on-year rise of 32.2 percent. In 2024, trade totalled US$43.8 billion, with Beijing emerging as the region’s primary investor and Astana’s largest trade partner.
With Russia increasingly perceived as a threat to regional stability, territorial integrity, and sovereignty in Central Asia following its invasion of Ukraine, China has effectively positioned itself as the region’s more stable and pragmatic partner. Chinese President Xi Jinping expressed support for Kazakhstan’s territorial integrity during his September 2022 visit to Central Asia and reaffirmed this stance at the China-Central Asia Summit in Xi’an in May 2023.
Amid the intensifying global competition for rare earth metals among major world powers, Beijing is taking bold steps to increase its influence in Central Asia by expanding its “circle of friends.” Given this context, the imposition of unilateral US tariffs on Kazakh exports inadvertently accelerates Kazakhstan’s pivot towards China. Consequently, Trump’s predatory tariffs, far from recalibrating global trade in Washington’s favour, create a strategic vacuum, presenting Beijing with an opportunity to maintain its monopoly over global rare earth supply chains and also extend its strategic reach deeper into Eurasia and Europe.
Ayjaz Wani (PhD) is a Fellow with the Strategic Studies Programme at the Observer Research Foundation.
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Ayjaz Wani (Phd) is a Fellow in the Strategic Studies Programme at ORF. Based out of Mumbai, he tracks China’s relations with Central Asia, Pakistan and ...
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