The Central Asia Regional Economic Cooperation (CAREC) program plans to launch negotiations on the Partnership Agreement on Trade and Investment Procedures Facilitation (CARTIF) in early 2026, aimed at forming a legal framework for the movement of goods, services, and capital across the borders of the region’s countries, including Azerbaijan.
Elchi.az reports with reference to an article on the Asian Development Bank (ADB) website that the purpose of CARTIF is to create an inclusive, transparent, and flexible regional economic partnership that contributes to the development of cross-border trade and investment.
In 2015-2024, the volume of intra-regional exports in CAREC countries more than doubled, but the share of intra-regional trade in the total volume of the region’s foreign trade remained almost unchanged and remained at approximately 6%.
The material noted that the dynamics of cross-border investment flows in CAREC countries were not uniform. During the period under review, the net inflow of foreign direct investment increased in Mongolia, Pakistan, and Uzbekistan, while it decreased in most other countries in the region.
Studies by CAREC on the simplification of transit trade in Azerbaijan, Kazakhstan, and Uzbekistan, as well as the ADB’s review of trade procedures and transport services along CAREC corridors, show that legal, regulatory, institutional, and infrastructure barriers that continue to complicate transit trade and international transportation remain.
The authors emphasized that the identified limitations increase costs and the level of uncertainty for foreign economic activity participants, which confirms the need for CAREC countries to strengthen their efforts to eliminate the remaining barriers. An empirical assessment of various configurations of the CAREC free trade agreement also shows that the simplification of cross-border trade and investment can bring significant economic benefits to the countries of the region, especially landlocked countries.
The CARTIF agreement covers broad policy directions related to the movement of goods, services, and capital across borders, includes “WTO-plus” elements that provide for deepened cooperation in the areas of sanitary and phytosanitary measures, technical barriers to trade, as well as “WTO-extra” elements that touch upon the simplification of investment procedures, digital trade, and supply chain connectivity.
A key feature of CARTIF is its flexible modular structure. The mandatory framework agreement and initial protocols will apply to all participating countries after the agreement enters into force, and additional protocols may be agreed upon in subsequent stages.
It is planned to create an institutional mechanism for CARTIF, including a council of ministers, a council of senior officials, a regional committee on trade and investment, as well as a secretariat. The agreement will also include a transparent and rules-based dispute resolution mechanism primarily aimed at consultations and reaching mutual agreement.
It should be reminded that on November 20, 2025, the 24th Ministerial Conference of the CAREC Program adopted the Bishkek Declaration, which officially launched the negotiation process on CARTIF.