The Asian Development Bank (ADB), an organization dedicated to poverty reduction in Asia and the Pacific, has come out with their Asian Development Outlook 2008 report, analyzing the Central Asian and Caucasus economies.  Overall, the report finds that the states of these regions have had significant economic growth in the past few years, but that a slow down is already occurring and will most likely continue into the near future, as the whole world appears to be preparing for an economic downturn.
Journalist Joshua Kucera does a nice summary of the report for eurasianet.org here.
The report states that the 2007 average growth rate for Caucasus and Central Asian nations was 11.6%, which was above the 8.7% overall average for all developing countries in Asia.  However, much of this was due to states in the Caucasus, as Turkmenistan and Uzbekistan were the only CA states to have growth above the 8.7% overall average.  In fact, this year's regional 11.6% growth rate was actually behind 2006's ADB approximation of 13.2%, therefore the CA is already showcasing a downward macroeconomic trend.  Continuing this downward drift, the ADB's 2008 Outlook predicts only a 7.5% regional growth rate this year and an 8.4% up tick in 2009.  http://www.adb.org/Documents/Books/ADO/2…

What is behind this drop off?  The ADB cites the effect of worldwide economic shocks on the region, including "skyrocketing' food and energy costs.  Concerning the rise of food prices, Turkish Weekly has written a short piece describing how this year's harsh winter has caused great hardship in the region, mainly stinging non-energy producers Tajikistan and Kyrgyzstan, as freezing temperatures were curtailing agriculture yields and causing increasing demand for expensive energy supplies.  The ADB report also argues that the US credit crisis was a culprit to the region's current and future economic downturn.

Last of all, but extremely crucial, was the report's scathing assessment of Central Asian states inflation situation, as it predicts the region's rates will continue to increase and it foresees double-digit rates in Kazakhstan (17.4%), Tajikistan (17%), Kyrgyzstan (12%), and Uzbekistan (10.9%).  There is great fear that this rising inflation will drastically affect food prices, hurting the most impoverished citizens in the region.  ADB Chief Economist Ifzal Ali worried that rising inflation and food prices could lead to increased income inequality and social instability, which would be a "clear and present danger for developing Asia.'

The ADB's report shows real growth for each Central Asian country, but rising inflation, food prices, and an internationally shaky economy, which will hurt foreign investment in the region, forecast a rather tumultuous economic, and therefore social and political, future for Central Asia.