The Eurasian Development Bank (EDB) has released a new study analyzing mutual direct investment (MDI) flows across the Eurasian region.
The report examines investment trends between 13 Eurasian countries – Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Mongolia, Russia, Tajikistan, Turkmenistan, Ukraine, and Uzbekistan – and external partners, including China, Turkey, Iran, and the Gulf states, from 2016 to the first half of 2024.
Key Findings on Investment Trends
According to the EDB, total MDI stock in the region reached $90.4 billion by mid-2024, reflecting a 6.4% increase from 2023.
China remains the largest investor in the Eurasian region, holding an MDI stock of $58.6 billion at the end of H1 2024, accounting for 64.8% of the total. Other major investors include:
- Turkey – $12.3 billion (13.6%)
- United Arab Emirates (UAE) – $12.2 billion (13.5%)
- Iran – $3.2 billion (3.5%)
- Saudi Arabia – $2.3 billion (2.5%)
- Qatar – $1.6 billion (1.8%)
Among these, Iran showed the highest investment growth, doubling its investments since 2016, with 90% directed toward Azerbaijan. Turkey demonstrated broad sectoral diversification, while Saudi Arabia and Qatar emerged as new investors, making their first investments in 2021 and 2024, respectively.
Investment Distribution in Eurasia
The largest investment recipients in the Eurasian region include:
- Russia – $23.5 billion (26%)
- Turkmenistan – $17.5 billion (12.5%)
- Kazakhstan – $15.5 billion (11.1%)
- Mongolia – $10.3 billion (7.4%)
- Uzbekistan – $8.8 billion (6.3%)
Central Asia received 51% of all investments from China, Turkey, Iran, and the Gulf states, totaling $46.2 billion, an increase of 25% since 2022.
Outbound Investment from Eurasia
The report also highlights outbound investments from the Eurasian region, which totaled $49.4 billion, doubling since 2016. Turkey received 80% of these investments, with a significant portion originating from Russia.
Sectoral Trends: Energy, Manufacturing, and Greenfield Investments
China continues to expand its investments in energy and manufacturing, although its traditional focus on extractive industries has declined. As of mid-2024, Chinese investment in mining and resource extraction stood at $36.2 billion, comprising 61.7% of its total investments in Eurasia.
Other notable sectoral trends include:
- Energy sector – Chinese investment grew 2.1-fold in 18 months to $4.1 billion, with 85% directed toward Uzbekistan.
- Manufacturing sector – Investment increased 8% to $11.8 billion, with most projects concentrated in Central Asia.
The Gulf states are also expanding their investments in the region:
- The UAE invested $12.2 billion, with 90% of its projects in Central Asia.
- Saudi Arabia increased investments from $300 million in 2021 to $2.3 billion in 2024, primarily in Uzbekistan’s power sector.
- Qatar made its first major investment in Kazakhstan in 2024, committing $1.6 billion to the telecom sector.
Rise of Greenfield Investments
Greenfield projects – new businesses and infrastructure developments – remain the dominant form of MDI, totaling $57 billion, nearly double the 2016 level. These projects now account for 63% of total investments, driven by the economic growth of Central Asia and increasing investor interest in energy, manufacturing, and extractive industries.
