Turan Research Center

Research Fellow Aigerim Turgunbaeva spoke with Japan's Sankei Shimbun for the second installment of its series on China and Russia's "backyard" in Asia, reporting from Bishkek on how Kyrgyzstan has become a transit point for goods and money flowing into sanctioned Russia.

Since Russia's 2022 invasion of Ukraine, Kyrgyzstan — long described as Central Asia's "star pupil of democratization" — has moved rapidly toward Moscow. The European Union assesses that its exports to Kyrgyzstan of items carrying military-conversion risk have risen roughly 800 percent since before the invasion, while Kyrgyzstan's exports to Russia have risen roughly 1,200 percent. Machinery exports to Russia, negligible before the war, reached $8 million, an increase of more than 40,000 percent. Kyrgyz GDP has grown at roughly 10 percent a year for four consecutive years.

Turgunbaeva told the paper that cryptocurrency has become the mechanism binding the two economies together. On Telegram, offers circulate to exchange USDT for dollars or rubles. "Kyrgyzstan has turned into a crypto corridor linking Russia with China and other countries," she said. Licensed crypto operators numbered three as of 2021; today there are roughly 200. Trading volume in 2025 exceeded 2.7 trillion som, surpassing the country's GDP.

She warned that the "gray zone" the authorities cannot see into is expanding, and that the country's growth rests on a dangerous foundation. "The spread of crypto and the acceleration of dependence on Russia are closely connected. If the Russian economy collapses, we could collapse along with it."

Read the full article on The Sankei Shimbun (in Japanese).

Aigerim Turgunbayeva is a Research Fellow at the Turan Research Center.