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11 Mar, 2016 10:16

China invests $2bn in Russian Far East

China invests $2bn in Russian Far East

Chinese firms have invested more than $1.9 billion in Russia’s Far East development projects, according to Russian news agency Sputnik.

An unnamed source at the Russian Far East Development Ministry said more than 31 agreements with a range of companies worth $2.6 billion have been signed by the Russian Far East Development Corporation. Investment from Beijing accounts for 75 percent of all the funding, the source added.

The Chinese money will be used in a wide range of projects, particularly in building an oil refinery and a logistics center, as well as the construction of a cement factory and a plant for reclaiming ferrous scrap metal.

The Russian Far East Development Corporation has already received over 109 applications for investment of $6.4 billion in local projects. So far it has approved 60 applications for ventures worth $3.8 billion.

READ MORE: Japan interested in developing Russia’s Far East

Chinese and Russian companies have a number of projects in Russia’s Far East in energy, trade and cross-border tourism. The biggest of them is the Power of Siberia pipeline which will deliver 38 billion cubic meters of Russian natural gas to China annually. Russian Prime Minister Dmitry Medvedev has described the pipeline the world’s biggest infrastructure project.

Cooperation in developing the sparsely populated but resource rich territory is one of the major points of interest between the two countries.

READ MORE: China begins construction of Power of Siberia pipeline for gas delivered from Russia

In November, Japan also expressed interest in developing Russia’s Far East. The country is planning to create a $110 billion fund to bankroll infrastructure projects with some of the money invested in Russia’s Far East.