BEIJING, Chinese mergers and acquisitions (M&As) in ASEAN countries soared in 2017 despite a slump in overall outbound investment, thanks largely to the country's Belt and Road Initiative (BRI), according to a report.

In 2017, the deal value of Chinese M&As in the 10-member Association of South East Asian Nations (ASEAN) surged to 34.1 billion US dollars, rising by 268 per cent and representing a quarter of the total value of disclosed Chinese M&As, says international accounting firm Ernst & Young (EY) in a report.

"Taking advantage of its geographic location as a trade hub under the BRI, ASEAN has achieved steady growth in recent years," said Andrew Choy, EY's Greater China International Tax Services Leader in the report.

Looking forward, China and ASEAN are expected to further improve their relationship and expand broader cooperation under the BRI, Choy adds.

Proposed by China in 2013, the BRI aims to build trade and infrastructure networks connecting Asia with Europe and Africa along ancient Silk Road maritime and overland trade routes..

Singapore became China's biggest M&A destination in 2017 as M&A activities in the island republic by Chinese enterprises surged, mainly in the transportation, technology, telecommunications and life science sectors, according to the report.

Situated along the Belt and Road, Malaysia and Indonesia offer plenty of investment opportunities, and both countries have offered incentives to attract foreign investment, the report notes.

However, China's total outbound direct investment (ODI) saw a drastic decline in 2017 amidst government efforts to curb irrational overseas investment. Data from the Ministry of Commerce showed that non-financial ODI fell 29.4 per cent year on year to 120 billion USD last year.

Non-financial ODI in countries involved in the BRI totalled 14.36 billion USD, accounting for 12 per cent of the total, up from 8.5 per cent in 2016.