OREANDA-NEWS. China's accumulated direct foreign investment (FDI) in Russia, Kazakhstan and Belarus increased from USD 11.02 billion to USD 24.67 billion in 2009-2013. Kazakhstan accounts for 91.5% (USD 22.57 billion) of all Chinese investment in these countries. This is stated in the report Monitoring of Direct Investment by Russia, Belarus, Kazakhstan and Ukraine in Eurasia 2014 (MDI Eurasia) prepared by Eurasian Development Bank's (EDB) Centre for Integration Studies. The report is based on the analysis of a large database on investment transactions, which has been developed by Eurasian Development Bank and the Russian Academy of Sciences' Institute of World Economy and International Relations (IMEMO) since 2013.

The researchers state that China has the most impressive FDI dynamics in Eurasian Economic Union's countries, which reflects the rapid expansion of Chinese TNCs in recent years.

While six years ago Chinese investment was comparable to that made by India in Kazakhstan, Russia and Belarus, now India lags behind China. However the report emphasises that this became possible only because of the extensive presence of Chinese TNCs in Kazakhstan.

According to the report, Chinese FDI in Kazakhstan is an important part of China's economic expansion in Central Asia, including the implementation of its concept of the New Silk Road Economic Belt. At present, however, the main investment projects by Chinese TNC are in the fuel sector, primarily oil and gas production, as confirmed by the report's data on China's largest investments in the region.

In Russia and Belarus, where, in the preceding years, cooperation with China was primarily based on lending, the absolute amount of accumulated Chinese FDI is eleven times less than in Kazakhstan. However, as the Centre for Integration Studies points out, the sector structure of Chinese FDI is more diverse and includes, in addition to large investment in the fuel sector, investment in glass and automobile production in Russia and in electric engineering, car parts manufacture and the hotel business in Belarus.

In 2014 the number of agreements and memoranda on cooperation between Chinese and Russian companies grew significantly and this may result in a breakthrough increase in Chinese FDI in the next few years.