11 Oct 2017 10:48

CIS mutual foreign direct investment rose 8% to over $45 billion in 2016 - EDB

ALMATY. Oct 11 (Interfax) - Mutual foreign direct investment among CIS countries grew by nearly 8% in 2016, the Eurasian Development Bank's (EDB) Center for Integration Studies said in a report called "Monitoring of Mutual Investments in CIS Countries - 2017."

"The downward trend in the foreign direct investment [FDI] stock of CIS countries between 2013 and 2015 has been replaced by significant growth. According to the latest data, over the course of 2016, mutual CIS and Georgian FDI stock increased by 7.9% to $45.1 billion after a three-year decline," the EDB said.

Russia has started raising more investment capital from its neighbors: FDI stock has increased by 61.1% to $6.1 billion. Higher values were posted only in 2010-2012.

"Still, in terms of FDI imports from post-Soviet states, Russia comes in only third place, after Belarus and Kazakhstan," the report says.

The top four Russian investors are Gazprom, LUKOIL, VimpelCom, and MTS. At the beginning of 2017, they accounted for $19.5 billion of total FDI stock. This represents more than 43% of total mutual direct capital investments in the CIS (or almost 56% of total Russian FDI in the post-Soviet area).

The ten largest investors in the CIS (now represented not only by Russian companies, but also by Belarusian, Azerbaijani, and Kazakh companies) account for 59% of total mutual FDI stock in CIS countries and Georgia.

"The most notable change in the list of leading investors that occurred in 2016 is the inclusion of the Belarusian Yuras Oil. VTB Group, meanwhile, left the list, due to the impairment of its Ukrainian assets," the report says.

The EDB notes that Ukraine has lost the status as the leading CIS FDI recipient.

"While in 2013 it accounted for $17.0 billion, or 31.2%, by the end of 2016, following a period of continuous decline, it plummeted to $5.6 billion, or 12.4%. It is quite possible that in 2017 Ukraine will be overtaken not only by the trio of EAEU founders but also by Uzbekistan, where the 2016 year-end figure was $5.4 billion. Ukrainian FDI exports to CIS countries and Georgia slid from the third to the fifth position between 2013 and 2016,'" the report says.

EDB is an international financial institution founded by Russia and Kazakhstan in January 2006 to promote the development of the market economies of its member states and ensure their sustainable economic growth and the expansion of their mutual trade and economic ties. EDB's charter capital is $7 billion. The bank's member states are the Republic of Armenia, the Republic of Belarus, the Republic of Kazakhstan, the Republic of Kyrgyzstan, the Russian Federation, and the Republic of Tajikistan.