China Enhances Presence in Kazakh Banking Sector to Facilitate OBORPosted: June 8, 2017
In my previous posts, I said Central Asia and Pakistan are key links of China’s Silk Road economic belt and 21st century maritime Silk Road (OBOR) plan as they concern China’s secure land connection with the Middle East and Europe.
In Central Asia, Kazakhstan, the largest country there, is the key. Reuters says in its report “China’s CITIC Bank approves deal for stake in Kazakh lender” yesterday that CITIC Bank will take 60% stake of Kazakh second largest bank Altyn Bank.
The report says, “Chinese lenders Bank of China (601988.SS) and Industrial and Commercial Bank of China (601398.SS) also have subsidiaries in Kazakhstan, although they are smaller than Altyn and focus on corporate lending.” Therefore, the deal will greatly enhance China’s presence in Kazakh banking sector.
Kazakhstan is to borrow lots of funds for its development of infrastructure and industry, especially energy industry. Borrowing from local banks though controlled by foreign banks is certainly better acceptable so that the deal will further facilitate China’s implementation of OBOR plan there.
Comment by Chan Kai Yee on Reuters’ report, full text of which can be viewed at http://www.reuters.com/article/us-altyn-bank-m-a-citic-bank-idUSKBN18Y3C6.