An average annual growth of China’s direct investment in Tajikistan rate for the last 5 years has amounted to 55 percent, says the Eurasian Development Bank (EDB) report, EAEU and Eurasia: Monitoring and Analysis of Direct Investments 2017.
About a half of China’s direct investments in Tajikistan reportedly goes to financing exploration and development of non-ferrous metal deposits.
Significant inflow of Chinese direct investments has been after settlement of territorial disputes between Tajikistan and China in 2011, according to the report.
EDB experts note that over the past three years, Chinese have shifted the focus away from the development of non-ferrous metal deposits to the production of building materials.
“By the end of 2016, non-ferrous metallurgy has accounted for 46 percent of the overall volume of cumulative Chinese direct investments while the construction sector has amounted for some 20 percent. Chinese companies are currently financing a number of projects in fuel industry and construction sector, including construction of the Tajik section of Turkmenistan-China gas pipeline and construction of the first line of the oil refinery in the Danghara Free Economic Zone (FEZ),” the report notes.
Meanwhile, according to data from the State Committee on Investment and State-owned Property Management (GosKomInvest) of Tajikistan, a total volume of cumulative foreign direct investments in Tajikistan has amounted to almost 3.2 billion U.S. dollars by the end of 2016.
China has reportedly accounted for some 32 percent (1.016 billion U.S. dollars) of the overall volume of the cumulative foreign direct investments in Tajikistan.
Tajikistan has benefited from USD 434 million in foreign direct investment (FDI) inflow in 2016, a significant improvement when compared with the USD 168 million of FDI recorded in 2013.
Over the first three months of this year, Chinese direct investments into Tajikistan have come to 76.6 million U.S. dollars (USD) — 58.2 percent of the overall total (more than 130 million USD).
China’s economic expansion in Tajikistan is a very young phenomenon. In the early 2000s, Chinese influence in Tajikistan was quite weak and limited, due to the lack of transport networks connecting both countries. Only after the opening of a new major highway between two countries did bilateral trade significantly increase. Another factor that contributed to the boost in Chinese economic activity was the availability of financial resources and readiness to invest even in less important sectors in Tajikistan. While few others seemed to be interested in investing financially in Tajikistan’s vitally important infrastructure, Beijing not only sponsored various projects but also got giant Chinese companies involved.
