September 11, 2013 / 4:17 PM / 4 years ago

China signs deals worth $3 bln with Kyrgyzstan

MOSCOW, Sept 11 (Reuters) - Chinese President Xi Jinping agreed to pump some $3 billion into infrastructure projects and loans to Kyrgyzstan, the latest deal in his Central Asian tour aimed at securing raw materials and trade routes to the West.

The agreement on Wednesday, which includes investment of $1.4 billion in the Kyrgyz stretch of the Turkmenistan-China gas pipeline, follows Xi’s signing of 22 deals worth some $30 billion with neighbouring Kazakhstan.

The United States, Russia and China have traditionally competed for influence in mountainous Kyrgyzstan, which borders China and is one of the poorest former ex-Soviet states despite substantial water resources and gold, coal and iron reserves.

Under the Kyrgyz deals, which Xi signed on Wednesday, China also agreed to offer two loans of around $400 million for a thermal power project and the construction of a new North-South highway as well as $1 billion of direct investment.

China has also initiated the establishment of a free economic zone in the area of the Silk Road, a trading route between East and West that centuries ago stretched across the sun-scorched steppes and mountains of Central Asia.

“The economic corridor of the ancient Silk Road must be recreated,” Xi said at the meeting of Kyrgyz and Chinese delegations in Bishkek, speaking through an interpreter.

China may participate in the reconstruction of the capital’s airport Manas, where a portion now used by the United States to support operations in Afghanistan is to be turned into a civilian hub after the United States vacates it next July, Kyrgyz Economy Minister Temir Sariyev told Reuters. (Reporting by Olga Dzyubenko, Writing by Alessandra Prentice; editing by Ron Askew)

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