[Public Voices] Responding to Supply Chain Crisis and Climate Change Through the 'Tan-Tan-Han' Network

Strengthening Korea-Uzbekistan Supply Chain Cooperation
Signing of Climate Change Cooperation Agreement
Securing Achievements Toward Greenhouse Gas Reduction Targets

Kim Heesang, Ambassador of the Republic of Korea to Uzbekistan

The business environment for companies worldwide is challenging. As strategic competition between the United States and China intensifies and the global supply chain, once taken for granted, fails to function properly due to the aftermath of the Ukraine war, governments and companies around the world are making every effort to secure essential raw materials for their domestic industries. Additionally, reducing carbon emissions to address climate change is a measure that the international community must implement for humanity's survival, but companies face many difficulties in the actual reduction process. Trade restriction measures justified by climate change response are also emerging. Therefore, the visit of Foreign Minister Park Jin to Kazakhstan and Uzbekistan from the 30th of last month to the 4th of this month holds great significance in terms of overcoming the supply chain crisis and responding to climate change.

Central Asia possesses abundant oil, gas, and mineral resources. It is also a geopolitical key point attracting international attention due to its geographical location connecting Russia, China, the Middle East, and Europe. China has been moving swiftly, following President Xi Jinping’s visits to Kazakhstan and Uzbekistan last year during the Shanghai Cooperation Organization (SCO) meeting, and hosting the Central Asia-China Summit in Xi’an, China, in May this year, inviting the heads of the five Central Asian countries.

In particular, Uzbekistan has served as a hub for Korean companies’ entry into Central Asia due to its geographical feature of bordering all other Central Asian countries, the largest population in Central Asia with a high growth rate, and the residence of 180,000 Koryo-saram (ethnic Koreans). Uzbekistan is rich in metal resources such as gold, uranium, molybdenum, tungsten, and copper. Among these, molybdenum and tungsten are rare metals critically used in our manufacturing industries, including semiconductors and machinery/tools.

Korea’s dependence on China for rare metals is high, which poses a risk to securing supply chains in the event of sudden international price increases or political factors. Uzbekistan has abundant rare metals but lacks the technology to utilize them to produce high value-added materials.

The two countries have agreed to further expand cooperation into new areas of supply chain security and joint climate change response, especially strengthening supply chain cooperation with private companies for copper used in secondary batteries, which are one of Korea’s main export products.

What is even more noteworthy is the signing of the Korea-Uzbekistan Climate Change Cooperation Agreement. Korea has pledged to reduce greenhouse gas emissions by 40% by 2030 to achieve carbon neutrality by 2050. Article 6 of the Paris Agreement stipulates a market mechanism that allows countries to issue and trade reduction credits (internationally transferred mitigation outcomes) generated through voluntary cooperative activities between countries. The climate change cooperation agreement signed this time provides a legal basis for bilateral cooperation to contribute to the international community’s climate change response efforts and promote public and private projects for greenhouse gas reduction, enabling Korea to secure internationally transferred mitigation outcomes to achieve its 2030 greenhouse gas reduction target.

Due to the Ukraine war and economic sanctions on Russia, Korean companies operating in the Commonwealth of Independent States (CIS) region are facing significant difficulties. It is now time to turn attention to Central Asia and seek new entry strategies. We hope that the Korean government’s economic diplomacy efforts will develop into a 'Tan-Tan-Han (Uzbekistan-Kazakhstan-Korea) Economic Security Network' through close cooperation among private companies, government, and public institutions.

Kim Heesang, Ambassador of the Republic of Korea to Uzbekistan