China’s FDI in South Caucasus triples over decade, Azerbaijan leads

China’s direct foreign investment (FDI) portfolio in the South Caucasus has grown 2.5 times over the past decade, reaching $690 million in the first half of 2025, with around 60% directed to Azerbaijan and 40% to Georgia, the Eurasian Development Bank (EDB) said.

The EDB report said Azerbaijan remains the main destination for Chinese capital in the region, with investments increasingly focused on manufacturing and energy, marking a shift from China’s previous extractive-industry orientation.

While global FDI flows fell 11% in 2024, Chinese investments in the Eurasian region continued to rise, adding $7.4 billion over the past 18 months to surpass $66 billion.

Though the South Caucasus represents a smaller share compared with Central Asia and Eurasian Economic Union countries, its portfolio is noted for stability and structural quality.

China’s total FDI in Eurasia reached $66.1 billion by mid-2025, up 80% over the past decade, with manufacturing and energy sectors now driving growth.

Gulnar