At the third Central and Eastern Europe (CEE) Summit, held in Belgrade on December 16-17, China announced new funds and projects with the region, stressing that cooperation would be in line with European standards. EURACTIV Serbia report.
Some view strengthening cooperation between China and Central and Eastern European countries as building a new “Silk Road”, while others believe it is a means to the Chinese to strengthen their presence in the large EU market.
From the point of view of the CEE countries, what should be allowed first in one of the world’s leading economies are investments, necessary in times of economic difficulties, in infrastructure and energy projects.
Analysts point out, however, that the profitability of these projects is questionable, given that they are carried out by Chinese companies with Chinese loans, even if these loans are favorable.
Li: China and Europe are natural partners
Chinese Prime Minister Li Keqiang said on December 16, during the political part of the Belgrade summit, that cooperation between China and the CEECs would conform to European standards and be helpful to European integration.
Li expressed hope that the EU would provide greater support for cooperation, saying China and Europe are “natural partners” between whom there are “no fundamental problems” despite the distance. geographical.
>>Read: The Balkan Railway is part of China’s ‘expressway’ to Europe
Some analysts say there is “a certain caution and reserve” within the European Union about China’s influence, given the challenges the bloc faces, such as the crisis in Ukraine. “Europe is not very happy to see Chinese products arriving on the European market in larger quantities via Southeast Europe,” said Serbian analyst Predrag Simi?.
Focus on infrastructure
At the summit, the Chinese premier stressed that cooperation between China and CEE countries can help both sides respond to global economic challenges, mentioning investment projects and infrastructure investments as the most important forms of cooperation. important.
“Infrastructure and investment projects will be the models of our cooperation. China has increased capacity in high-speed trains, nuclear power, telecommunications, steel and glass production and the cosmetics industry, while central and eastern European countries must push ahead with their projects investment, including transport,” he added.
Li said he hoped his country would be able to open factories in this part of Europe, which would produce the equipment, materials and facilities needed for infrastructure development in the region, which would create new jobs.
Central and Eastern European countries also agreed that there is a significant need and potential for cooperation with China.
“All participating countries benefit from this dynamically developing cooperation format. Roads, digital communications and other forms of communication form the foundation of the connection between Europe and China,” said Latvian Prime Minister Laimdota Straujuma.
High-speed train through the Balkans
The Balkan countries are of interest to Chinese investors because they play a major role in transit. But infrastructure and roads leading to the heart of the Balkans, which constitute the region’s main need, are less important to China.
As for concrete projects, the most discussed at the summit was the modernization of the Belgrade-Budapest railway, on which China, Serbia and Hungary signed agreements during the meeting.
The modernization is to be completed in two years and the railway will then be extended to Skopje and then to Athens. The railway, as the Chinese Prime Minister pointed out, would be part of a “land and sea express line” between China and Europe.
>>Read: China seeks gateway to EU via cash-strapped Balkans
According to estimates, the modernization of the Budapest-Belgrade railway line, which is expected to reduce the journey from 8 to 2.4 hours, will cost between 1.5 billion and two billion euros. The parties concerned must determine the means of financing and prepare proposals in this area before January 20.
Chinese companies are already present in the Western Balkans market: the Chinese Prime Minister inaugurated a bridge over the Danube on December 18 in Belgrade, built largely by Chinese companies and financed by a Chinese loan, while Montenegro is building its first highway linking the Adriatic to Serbia, with Chinese companies and a Chinese loan.
Other countries in the region have or want similar projects, such as Croatia, which wants to modernize the airport on the island of Krk and expand the capacity of the Osijek thermal power station.
However, China and Serbia managed to agree on the largest number of projects, given that the Chinese Prime Minister remained on a bilateral visit to Serbia after the summit. The two countries signed 13 agreements and contracts, including the loan contract for the construction of a second block of the Kostolac thermal power plant, worth $608 million.
Chinese companies, as Serbian officials say, have expressed a desire to participate in the privatization of 18 Serbian companies.
New Chinese funds for the region
In addition to the existing credit line for the CEECs, China plans to create a new investment fund worth three billion dollars, which will be made available to these countries.
“Money from the fund will be used through public-private partnerships and leasing agreements,” Li said at the opening of the Belgrade Summit Economic Forum on December 16.
At the first summit in Warsaw in 2012, China announced a credit line worth 10 billion dollars to finance projects in Central and Eastern European countries, with 1.7 billion remaining of this amount, Mr. Li said, adding that additional funds would be obtained.
The summit was also an opportunity for bilateral talks between CEEC leaders on infrastructure projects, cooperation and European integration. Serbian Prime Minister Aleksandar Vu?i? met his Albanian counterpart, Edi Rama.
Croatian Prime Minister Zoran Milanovi? however, refused to attend the summit because Serbia had not explicitly distanced itself from the extremist statements made by war crimes accused Vojislav Šešelj, temporarily released by the ICTY, but Deputy Prime Minister Vesna Pusi? participated in the summit.
Some Croatian media criticized Milanovi?’s decision, pointing out that a serious opportunity to strengthen cooperation between Croatia and China had been missed.
