▲ Cars travel along the 66-kilometer Almaty Ring Road (BAKAD) on the outskirts of Almaty, Kazakhstan, on June 25, 2026. Built with the participation of Korean companies and a public corporation, BAKAD opened in 2023, with Korea Expressway Corp. and others also involved in its operations and maintenance. (Yonhap)

 

By Seong Do-hyeon

 

ASTANA, ALMATY, Kazakhstan, Sept. 11 (Yonhap) -- In late June, cars streamed nonstop onto the 66-kilometer Almaty Ring Road, known as BAKAD, after leaving downtown Almaty, Kazakhstan's economic hub, and heading toward the outskirts.

 

The vehicles bypassed the city after passing through smart tolling sections that use license plate recognition without barriers. Korean companies participated in the construction of the road, while Korea Expressway Corp. and others have remained involved in its operation and maintenance since it opened.

 

The scenery changes again along the road. Nearby, Alatau City, a massive new innovation city bringing together smart-city infrastructure, advanced industries, research and education, is being developed as a new economic hub.

 

In Almaty, work is also gathering pace to establish a Rare Metals Technology Cooperation Center, using 19.8 billion won in official development assistance from the South Korean government to turn Kazakhstan's rare metals into high-value-added materials.

 

Government officials interviewed in the capital Astana shared a common goal: to move beyond simply extracting and exporting oil and gas, uranium and various minerals, and instead expand the value chain toward an economy that processes and manufactures resources domestically while fostering advanced industries.

 

Against the backdrop of the first Korea-Central Asia Summit, set to be held in Seoul for the first time in mid-September, cooperation between South Korea and Kazakhstan is expanding from critical minerals into urban development, artificial intelligence (AI), health care and finance.

 

BAKAD has already entered the operational phase, but projects such as the Rare Metals Technology Cooperation Center and Alatau City still need to produce tangible results. The key challenge for bilateral cooperation will be whether plans and technical cooperation can be translated into actual production, investment and long-term contracts.

 

▲ Employees at the control center of Bar, the local operations and maintenance company for the Almaty Ring Road (BAKAD), monitor road conditions in real time on large screens in Almaty, Kazakhstan, on June 25, 2026. Korea Expressway Corp. and other Korean entities are involved in the road's operations and maintenance, using an intelligent transportation system (ITS) to manage traffic conditions and road safety. (Yonhap)

 

◇ Critical minerals emerge as key area of Korea-Kazakhstan cooperation, with supply-chain diversification and expanded value chains in focus

 

Critical minerals are the most direct area of industrial cooperation between the two countries. In Almaty, a 19.8 billion-won project to upgrade Kazakhstan's rare-metals industry will run for five years from this year through 2030 under an ODA program led by South Korea's Ministry of Trade, Industry and Energy.

 

Kazakhstan's Ministry of Science and Higher Education is participating as the counterpart institution, while pilot infrastructure and equipment are being established around the country's Institute of Mineral Processing (IMOB).

 

The minerals covered include rare earth elements such as titanium (Ti), zirconium (Zr), hafnium (Hf), neodymium (Nd), praseodymium (Pr) and samarium (Sm), as well as molybdenum (Mo) and tungsten (W).

 

The goal is to move one step beyond simply exporting minerals extracted from the ground. The project aims to pilot-produce industrial materials locally, develop technologies for environmentally friendly refining and smelting and value addition, and train researchers in the production of ultra-high-purity materials.

 

It also aims to pilot-produce five types of 4N-grade metals with a purity of 99.99 percent and two types of powder products smaller than 100 micrometers by 2030.

 

The project is seen as providing South Korea with a foundation for diversifying supply chains for critical minerals used in advanced industries, while giving Kazakhstan an opportunity to expand its value chain from raw-material exports into refining and materials manufacturing.

 

"Mineral cooperation is shifting from traditional raw-material supply toward production cooperation, technology exchanges and the production of higher-value-added products," an official from Kazakhstan's Ministry of Industry and Construction said, expressing hopes for long-term cooperation with South Korea through domestic raw-material processing and the construction of new production facilities.

 

▲ A train travels between light rail transit (LRT) facilities in central Astana, Kazakhstan, on June 23, 2026. Kazakhstan is expanding transportation and digital infrastructure in major cities, including the capital Astana and economic hub Almaty. (Yonhap)

 

◇ Kazakhstan expands investment base for mineral industry, but must move beyond research and technical support

 

Kazakhstan is also expanding its financial and institutional framework to attract investment in the mineral industry.

 

According to the Ministry of Industry and Construction, the Development Bank of Kazakhstan (DBK) is pursuing a US$1 billion (about 1.4 trillion won) financing program from 2025 to 2030 for projects involving the extraction and processing of rare, rare-earth and critical minerals.

 

The program covers not only rare earths but also lithium, cobalt, tungsten, germanium, gallium and graphite. Borrowers must first verify reserves in accordance with the international JORC standard. The Kazakh government operates 18 special economic zones as well as a digital platform for mining rights.

 

However, producing prototypes at a pilot center and having companies commercially produce them and commit to long-term purchases are two different stages.

 

Some in the industry say South Korea's cooperation with Central Asian countries on critical minerals needs to go beyond research and technical support and eventually lead to private-sector investment, long-term purchase agreements and securing actual supply volumes.

 

The mineral industry, in particular, involves substantial capital and risks from the early stages of exploration and development, but successful projects can secure long-term participation and supply rights, making competition among major countries fierce.

 

The Korea Institute of Geoscience and Mineral Resources (KIGAM) and Kazakhstan's state-owned mining company Tau-Ken Samruk are also cooperating under a memorandum of understanding signed in 2024.

 

"Experts from the two countries are evaluating and analyzing geological information to identify areas with strong business potential," a ministry official said. "The next stage will be decided after an economic and technical feasibility assessment."

 

The Rare Metals Technology Cooperation Center, too, will ultimately be judged by whether pilot production leads to corporate participation, commercial production and an actual supply chain.

 

▲ Officials, including Kim Dae-young (3rd from L), head of the Kazakhstan subsidiary of global health care company Open Healthcare, and Min Hee-seok (2nd from L), director of the Korean Medical Center Almaty, pose for a photo at Open Healthcare in Almaty, Kazakhstan, on June 24, 2026. (Yonhap)

 

◇ Korean business model takes root on the road, with similar approach emerging in health care

 

If rare metals represent an effort to prepare for future supply chains, BAKAD is already a successful example of Korea-Kazakhstan cooperation operating on the ground.

 

BAKAD opened in 2023 as a public-private partnership (PPP) involving SK ecoplant, Korea Expressway Corp. and others. The road incorporates smart tolling, an intelligent transportation system (ITS) and automatic license plate recognition.

 

South Korea has gone beyond simply building the road and handing it over, remaining involved in its long-term operation and maintenance since its opening. Korean and local personnel jointly handle snow removal, pavement repairs, traffic safety, accident response and toll collection.

 

"From Kazakhstan's perspective, this is a model for accumulating operational experience along with foreign construction technology, while for Korea it is a project that builds a track record of long-term overseas operations," Son Byung-moon, head of Bar, the local operations and maintenance company, said. "It is a model worth considering for future new cities and industrial facilities."

 

A similar local operations model can also be seen in the health care industry. Open Healthcare in Almaty employs about 170 people, most of them local staff, and connects Korean medical professionals and major hospitals with local medical personnel.

 

Rather than continuously dispatching Korean doctors, the company sees training local medical staff and establishing Korea's health screening and treatment systems locally as its long-term direction.

 

Although roads and health care are different fields, they share an approach of not stopping at bringing in technology but building the people and systems needed to operate it locally.

 

▲ The Gate City area of Alatau City near Almaty, Kazakhstan, is seen on June 20, 2026. The Kazakh government is seeking to develop the new city as an economic hub integrating residential and commercial facilities, advanced industries, research and education, and smart infrastructure. (Yonhap)

 

◇ Alatau City highlights importance of infrastructure and finance; 'K-Park' also takes shape as Korea-linked cultural and industrial complex

 

Alatau City near Almaty is a project that illustrates the scale of Kazakhstan's industrial transformation plans. Passing BAKAD and heading toward Alatau City feels like moving from the present into the future.

 

The Kazakh government aims to build a large new city that brings together smart-city infrastructure, residential and commercial facilities, advanced industries, research and education, and future transportation in one place. It is also drawing on South Korea's urban development experience in places such as Pangyo and Songdo.

 

Cooperation has been discussed with Korean institutions and companies in smart infrastructure and future transportation, including urban air mobility (UAM) and drones. Plans are also under way to cultivate talent using South Korea's science and technology education model, modeled on the Korea Advanced Institute of Science and Technology (KAIST).

 

Ethnic Korean entrepreneurs, including Caspian Group, which is participating in some projects within the Alatau City development area, are also seeking to serve as private-sector bridges connecting Kazakhstan with Korean companies and institutions.

 

Chae Yuri, chairwoman of Caspian Group, is actively pursuing such cooperation, believing Kazakhstan's land, resources and strategic location can be combined with South Korea's technology and experience in urban development and education.

 

The word Chae emphasizes when meeting with Korean companies is "trust."

 

"Given our experience with major development projects in the past, investors need not only the government's willingness to provide support but also predictability and actual implementation of laws, institutions and administrative procedures," she said.

 

▲ Chairwoman Chae Yuri (4th from L) and Kim Yulia (3rd from L), head of the Korean subsidiary, pose for a photo with other officials at the Caspian Group office in Almaty, Kazakhstan, on June 20, 2026. Caspian Group, which is participating in some development projects in Alatau City, is pursuing cooperation with Korean companies and institutions in urban development, education and advanced industries. (Yonhap)

 

Still in its early stages, Alatau City requires upfront investment in infrastructure such as roads, electricity, water and sewage systems, while a viable revenue model will emerge only when companies and residents actually move in.

 

As a result, the project's future viability is expected to depend less on its scale or the names of participating institutions than on how steadily it can attract private capital and tenant companies.

 

K-Park, being promoted by the ethnic Korean community within Alatau City with a target completion date of September 2027, the 90th anniversary of the forced relocation of ethnic Koreans, is another effort to connect the two countries through culture, education and business. Chae said ethnic Korean businesspeople are taking the lead in raising funds for the project.

 

Finance is another pillar for turning industrial transformation into investment. Even if the government plans new cities and industrial projects, private companies need financial institutions to recognize their commercial viability before they can participate. Banks inevitably assess cash flow, collateral, legal stability, exchange rates and repayment capacity rather than the symbolic value of a project.

 

This applies to both rare metals and Alatau City. For intergovernmental cooperation and memorandums of understanding to develop into private-sector businesses, a return-and-risk structure that investors can bear must be established.

 

▲ Construction work is under way at "K-Park" in Alatau City near Almaty, Kazakhstan, on June 20, 2026. Led by the ethnic Korean community and businesspeople, K-Park aims to serve as a cultural, educational and business hub connecting Korean history and culture with South Korea. It is targeted for completion in 2027, the 90th anniversary of the forced relocation of ethnic Koreans to Central Asia. (Yonhap)

 

◇ After summit, focus shifts to 'connection' and 'execution' as Korea-Kazakhstan cooperation gains attention

 

The industrial policies that reporters observed in Astana and the industrial sites visited in Almaty ultimately converge at one point.

 

Kazakhstan has abundant resources and vast territory, while South Korea has expertise in materials and components, digital technologies, urban development and operations.

 

The Rare Metals Technology Cooperation Center seeks to establish the technological and human-resource base needed to turn raw materials into advanced materials, while BAKAD demonstrates that South Korea can remain involved beyond construction and into long-term operations.

 

Alatau City is a new experiment aimed at bringing together cities, advanced industries and talent in one place. In health care and finance, there are already signs of efforts to take root around local personnel and customers.

 

The Korea-Central Asia Summit could provide an opportunity to take such cooperation to the next level.

 

Of course, industrial transformation will not be completed simply by announcing new projects or signing memorandums of understanding at the summit.

 

Rare metals need to move from prototypes to actual production and purchase agreements, while new cities need to secure private capital and tenant companies. AI and health care, too, need local talent and markets capable of making use of them.

 

Ultimately, the next stage of industrial cooperation between the two countries will be about connecting minerals, technology, cities, finance and talent into a single industrial ecosystem rather than treating them as separate projects.

 

The key question is whether Kazakhstan can move from an economy that "extracts minerals" to one that "processes minerals and operates technologies and services," and whether cooperation with South Korea can advance beyond support and planning into investment, production and operations.

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