(Yicai) May 27 -- Since the Belt and Road Initiative was first proposed a decade ago, Chinese companies have comprehensively participated in the economic development of Central Asia across various sectors, such as infrastructure, energy, manufacturing, and the digital economy, according to PricewaterhouseCoopers.

The involvement of Chinese firms in the Central Asian economy has not only driven the upgrading of local industrial chains and created a large number of jobs but also significantly improved the level of connectivity within the region, according to two reports recently released by PwC.

In recent years, Central Asia has become increasingly attractive to international investors, including Chinese ones, mainly because countries in the region have focused on attracting foreign investment through the continuous improvement of related policies, Cai Ling, global cross-border services managing partner at PwC China, told Yicai.

Moreover, reports from the World Bank indicate that countries such as Kazakhstan, Uzbekistan, and Kyrgyzstan have a competitive business environment on a global scale.

The resource endowments and development needs of Central Asia are highly complementary to China's industries, with promising growth prospects in certain sectors, Cai noted, adding that the region's shortcomings and demands in areas such as agriculture, green energy, infrastructure, and cross-border e-commerce align well with the technological advantages and industrial chain capabilities of Chinese firms.

The economic and trade cooperation between China and Central Asia has three main characteristics, according to Cai. The first is that the cooperation landscape continues to expand, with Chinese investments progressively extending from traditional sectors, such as energy, minerals, and infrastructure, to emerging fields including green energy, modern agriculture, digital economy, cross-border e-commerce, and automotive manufacturing.

The second characteristic is that the depth of the cooperation is continuously enhancing, transitioning from single project contracts to full industry chain collaboration.

The third one is that the support for connectivity is being reinforced, as highlighted by the improving operational efficiency of the China-Europe Railway Express and the steady progress of projects such as the China-Kyrgyzstan-Uzbekistan Railway and the China-Kazakhstan Tacheng-Ayagoz Railway, which will further empower economic and trade activities between China and Central Asian countries.

In addition to agriculture, Central Asia is also rich in solar and wind energy resources, which have become key industries for the development of major countries of the region, the PwC reports indicated.

Given the differences among the five Central Asian countries, Chinese companies need to conduct thorough research on their market access requirements, tax policies, and foreign exchange control regulations before making investments, Cai suggested. This will help them align with the industry incentive policies of each nation and reduce compliance costs.

Last year, China's exports to the five Central Asian countries -- Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan -- rose 11 percent to USD71.2 billion from the year before, while imports from them jumped 15 percent to USD35.1 billion. The main exported goods were minerals and metals, while the imported ones were industrial goods.

China's foreign direct investment in Central Asia surged to USD35.9 billion in the first half of last year from USD19.6 billion in 2016, with about 90 percent of the total invested in Kazakhstan, Uzbekistan, and Turkmenistan. The investments cover various fields, including agriculture, industrial manufacturing, and transportation, and they are extending into emerging sectors, such as green energy and the digital economy.

Editor: Futura Costaglione