Channels of Chinese Capital Penetration to the Central Asian Countries within the Framework of the Belt and Road Initiative

Madina O. Turaeva, Svetlana P. Glinkina and Artem A. Yakovlev
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Madina O. Turaeva: Institute of Economics of the Russian Academy of Sciences
Svetlana P. Glinkina: Institute of Economics of the Russian Academy of Sciences
Artem A. Yakovlev: Institute of Economics of the Russian Academy of Sciences

Journal of New Economy, 2018, vol. 19, issue 4, 64-78

Abstract: The research pursues the question of evaluating the scales of the actual presence of Chinese capital in the Central Asian economies. The article reviews traditional and new channels used by China to enhance its presence in Central Asia within the framework of the Belt and Road Initiative. The methodological basis of the work is the classical and modern concepts of economic science. The solution of the tasks set within the study preconditioned the application of an interdisciplinary approach, the use of the scientific framework of related disciplines, as well as general and specific methods of research aimed at identifying trade and non-commercial channels for the penetration of Chinese capital into the region. In addition, the article discusses statistical discrepancies in recording of the scales of China’s actual presence in the Central Asian region. The research findings demonstrate that cooperation in trade is weakening, the focus shifts towards the channels related to new technologies, particularly to acquiring controlling inter? ests in the strategic regional companies, EPC contracts for infrastructure projects, as well as outsourcing services provided to large Western multinationals, which have an extensive network of branches and significant administrative base in the countries of the region. Finally, the authors conclude about the debt burden of the Central Asian countries to China and validity of fears related to some of the republics being at the edge of bankruptcy

Keywords: public debt; EPC contract; trade; natural resources; infrastructure; Central Asia; China; the Belt and Road Initiative.Journal: Journal of New Economy (search for similar items in EconPapers)
JEL-codes: F20 L70 P52 (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:url:izvest:v:19:y:2018:i:4:p:64-78

DOI: 10.29141/2073-1019-2018-19-4-5

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