Policy Briefs

The Trans-Caspian Corridor: Understanding the Financial Framework for Attracting and Derisking Foreign Capital

The development of the Greater Caspian region has become a geopolitical imperative for the European Union. The war in Ukraine, instability in the Middle East, and disruptions along the Suez and Red Sea route have brought Central Asia and the Greater Caspian Region into sharper focus for the EU. Due to its wealth of resources of fossil fuels, hydrogen, and Critical Raw Materials (CRMs), the region holds materials which are vital for a number of core elements of the green transition, particularly in the manufacture of battery technology to store green energy. The region holds the potential to serve an essential role in the European Union’s environmental pivot.

The Middle Corridor: EU Connectivity through Infrastructure Digitalisation and a Single Window Environment

Amid global supply chain disruptions and geo-political uncertainty, the Middle Corridor, also known as the Trans-Caspian International Transport Route (TITR), is rapidly redefining how Europe connects with the Asian continent via Central Asia and the Greater Caspian region – offering a faster, more reliable alternative to traditional trade routes. Increasingly emboldened by investment and regional cooperation, this multimodal corridor promises to reduce transit times, bypass existing chokepoints, and drive digital innovation in customs and logistics.

The Trans-Caspian Corridor: Financial Risk Mitigation for Unlocking EU Connectivity with the Greater Caspian Region and Central Asia

Examining the financial mechanisms underpinning the European Union’s engagement in Central Asia, this Policy Brief focuses on the Trans-Caspian Transport Corridor (TCTC) as a strategic infrastructure and trade initiative. It analyses how instruments such as the European Fund for Sustainable Development Plus (EFSD+), the European Investment Bank (EIB), and the Multilateral Investment Guarantee Agency (MIGA) are deployed to de-risk private investment, foster sustainable development, and strengthen regional connectivity. By assessing both the opportunities and challenges of EU-backed financing, the study highlights how coordinated investment, regulatory frameworks, and risk mitigation strategies can enhance economic integration, diversify supply chains, and support the EU’s broader geopolitical and green-transition objectives in the Greater Caspian Region.

The Impact of CBAM in the Greater Caspian Region

The EU’s Carbon Border Adjustment Mechanism (CBAM) will enter its definitive phase in January 2026, and CBAM tariffs are set to have major ramifications for countries exporting goods to the EU. What will be the impact of CBAM on Azerbaijan, Kazakhstan and Turkmenistan, also referred to as the Greater Caspian region?

The Middle Corridor’s Reality Check: Advancements and Challenges in Port Infrastructure in the Greater Caspian Region

Recent geopolitical upheavals, including Russia’s war in Ukraine and the escalating Houthi threat in the Red Sea, have reignited interest in the Trans-Caspian International Transport Route (TITR), also known as the ‘Middle Corridor.’ The corridor puts the Caspian Sea and Greater Caspian Region at the centre of transcontinental transport links by offering an alternative to the longer and politically compromised New Eurasian Land Bridge (NELB) or ‘Northern Corridor’ that crosses Russia. This new multimodal ‘Middle’ corridor connects China and Europe by traversing China, Central Asia, the Caspian Sea, the South Caucasus and the Black Sea before reaching the EU in just 15 days. Beyond offering strategic diversification away from Russia and traditional sea routes, the TITR enables the Central Asian and South Caucasus states to foster economic growth and regional development to create robust and efficient logistical networks.

Hungary and Serbia: China’s New Offshore Manufacturing Hubs in the EU?

Chinese greenfield investments in Europe are on the rise, reshaping the landscape of foreign direct investment. Instead of mergers and acquisitions, Chinese companies are increasingly setting up new operations, particularly in Hungary and Serbia. This shift is driven by factors like the EU’s tighter investment screening and China’s strategic focus on long-term market presence. Greenfield investments, especially in sectors like electric vehicles and renewable energy, offer Chinese firms fewer political hurdles, while supporting local economies. How are these investments shaping EU-China relations and offering new opportunities and challenges for European policies?

The Middle Corridor’s Reality Check: Advancements and Challenges in Rail Infrastructure

The development of railway infrastructure in Kazakhstan, Turkmenistan, and Azerbaijan is crucial for maximising the potential of the Trans-Caspian International Trade Route (TITR) or Middle Corridor, a vital link connecting Europe and Asia. The Caspian Sea ports, which serve as critical transit hubs, rely heavily on the efficiency and modernisation of rail networks in these countries to enable a smoother and more efficient transit of goods across the region and beyond. Railways offer the most effective means of linking these landlocked nations to ports and markets beyond their borders. However, the conditions of their railroad networks highlight significant development disparities.

President Yoon’s Short-lived Martial Law Declaration and Its Fallout

President Yoon Suk-Yeol sent the Republic of Korea into political turmoil in early December 2024 by declaring martial law, citing the need to “wipe out anti-state forces,” only to withdraw it again several hours later. Since then, the country has been sent into uncertainty. While impeachment proceedings have been set in motion, these recent developments have severely impacted the country’s domestic governance, as well as its ability to participate in global politics. What are likely avenues for South Korea to overcome this political unrest and what does it mean for EU-South Korea relations?

Energy Opportunities in the Greater Caspian Region: Unlocking Strategic Gains for Europe

Amid the ongoing war in Ukraine and the urgent need to reduce dependency on the Russian energy sector, the EU has intensified the diversification of its fossil fuel imports and expanded renewable energy sources in line with the REPowerEU plan to enhance overall energy security. A key aspect of this strategy has been increasing liquefied natural gas (LNG) supplies from the United States, Norway, and North Africa. However, the need for diversified energy sources persists. The Greater Caspian Region, in particular, offers substantial potential for rapidly boosting exports within a short timeframe. To fully capitalise on the opportunities in the Greater Caspian Region, European companies and governments should navigate a complex landscape of geopolitical dynamics and infrastructural commitments. Balancing the urgent need for energy security with the long-term goals of sustainable development will be crucial for the success of these endeavours.