China's quiet expansion: Firms deepen ties in occupied Ukraine
At least a dozen Chinese companies are operating in the Russian-occupied territories in the Luhansk and Donetsk regions in eastern Ukraine, according to the Ukrainian portal New Voice (NV). The Russians are currently rebuilding a highway over 600 kilometres long that connects cities in Russia and the occupied Ukrainian territories. They hope it will help attract as many Chinese companies as possible.
- At present, the Russians lack the financial resources to develop the occupied Ukrainian lands. That’s why the Kremlin is trying to involve Chinese companies in investing in these regions - said Pavlo Lysiansky, director of the Ukrainian Institute for Strategic Studies and Security.
NV emphasises that Chinese companies are present there as investors, importers, and employers. They operate in energy, agriculture, and are involved in infrastructure construction.
The portal analysed, among other things, publications in Russian media and administrative reports from occupied territories and spoke with Ukrainian experts who monitor the situation on the Russian-occupied lands.
According to NV, the first business contacts between Chinese enterprises and companies operating in the occupied territories were made in the spring of 2023 at the "Canton Fair" in Guangzhou. Artem Zhychariov, an advisor to the director of a metallurgical company operating in the Donetsk region, Nadra, attended the event. Zhychariov also visited factories producing mining equipment in Beijing, Zhengzhou, Jinan, and Taiyuan.
Following Zhychariov’s visit to China, companies from the Donetsk region signed a series of contracts with Chinese companies - reports NV. Among them were Liming Heavy Industry Science & Technology, Amma Construction Machinery, and Zhongxin Heavy Industrial Machinery.
The Ukrainian portal emphasises that contacts are being expanded at the political level along with the development of business ties. For example, in 2023, the Congress of Comprehensive Territorial Development was held in Moscow, in which, besides officials of the Russian occupation administration of the Donetsk and Luhansk regions, representatives of the Communist Party of China involved in the construction industry also participated.
Russians want to attract Chinese companies
According to NV, the Russians are currently rebuilding a highway over 600 kilometres long that connects cities in Russia and the occupied Ukrainian territories, including Rostov-on-Don, Mariupol, Melitopol, and Simferopol.
With this road, the Russians want to attract as many Chinese companies as possible to the regions they have taken over - assesses NV.
The tightening of ties is also visible in trade data. According to one of the interlocutors of the Ukrainian portal, in 2023, goods from China accounted for about 60 percent of imports to the Luhansk region. China was also the main recipient of exports from the Donetsk region.
According to Petro Oleschuk, a political scientist from Taras Shevchenko University in Kyiv, the increased contact between China and the Ukrainian-occupied territories help Moscow build the narrative that these lands are Russian.
- The Kremlin offers favorable conditions to China and its businesses in the occupied territories [of Ukraine]. In response, China promotes the narrative through all diplomatic channels that the occupied regions should remain under Russian control. Essentially, this is a form of business lobbying, but with the specific goal of legitimizing Putin's military aggression at the international level - assessed Oleschuk.
