China increases investments in the Balkans by presenting them with less conditions than the EU

But observers say there is growing concern about the billions of dollars of Chinese-backed Chinese influence that Beijing has invested in the region since 2005.

Others say, however, that China’s regional influence is overestimated.

Financial estimates vary. The London-based Institute for Strategic Studies says that since 2011, China has invested an average of about $ 1 billion in the region each year. The American Institute of Entrepreneurship estimates that almost the same amount has been invested annually in the region since 2005. The Center for Strategic and International Studies, based in Washington, estimates the amount at almost $ 1.8 billion a year since 2012.

Experts, however, agree that Serbia receives 80% of Chinese investment in the Western Balkans.

Although Chinese investment accounts for about 1% of foreign investment in Serbia, while EU investment is at 70%, a June 2020 poll by the International Republican Institute found that 71% of Serbs consider China one of the most important economic partners. of the region.

Concern of regional experts

During a recent conference in Belgrade on Chinese influence in the region, some experts said that public favoring of Beijing’s investments, despite investments from Western Europe, is politically orchestrated.

“Much of the support for China comes from the Serbian political elite and the media, which are directly or indirectly controlled by the Serbian elite,” said Vuk Vuksanovic, an expert on China, the EU and the Western Balkans at the Belgrade Center for Policy. Security. “So, from this point of view, China did not make an excessive campaign to create its image in Serbia, simply because it did not have to do it. “China has the Serbian government that does this, and the perception of China is really positive in the Serbian public opinion.”

Stefan Vladisavljev, of the Belgrade Fund for Political Achievement, said some lawmakers and officials in the region prefer Chinese investment as Beijing imposes fewer obligations on regional officials and stakeholders on the ground.

“When China approaches countries, generally developing countries, China offers infrastructure projects that are often agreed upon in a non-transparent way. They are accompanied by limited conditions, and this is attractive,” said Vladisavljev, noting that the EU has investment guidelines requiring regional governments and businesses to prove that they comply with EU standards.

“If someone does not put political pressure on you to make reforms, to respect competition or the rule of law, you would be very happy to implement such projects,” said Vladisavljev.

Officials at the Chinese embassy in Belgrade did not respond to numerous requests for comment.

Over the past 20 years, adds Vladisavljev, it is estimated that Serbia has accumulated about $ 7.9 billion in debt to China. He says that before increasing its debt to China, Serbia must ensure that safeguards are in place for Serbian workers. He cites allegations of exploitative practices at Chinese tire company Shandong Linglong Tire Co., located in Zrenjanin, about an hour’s drive from Belgrade, where Vietnamese migrant workers have been left unpaid and living in unheated barracks.

“At the moment we are talking about the rights of Vietnamese workers, and maybe tomorrow of our own Serbian workers,” said Vladisavljev.

The Linglong company did not respond to numerous requests for comment on allegations of poor work practices, nor did officials at the Chinese embassy in Belgrade.

Serbian leaders, such as Prime Minister Ana Brnabic, have downplayed the events at the Chinese tire factory, claiming that negative media coverage was organized by those opposed to Chinese investment in Serbia, citing frequent Western criticism that Chinese projects have outlines. unclear procedurally, raise environmental questions and are designed to strengthen Beijing’s political influence in Europe.

“In the beginning, it was the environment. Now. Focus on employees there. “Tomorrow will be something else”, the media quoted the Prime Minister as saying.

Serbian President Aleksandar Vucic said a Serbian labor inspectorate official had been sent to Zrenjanin, but openly stated what could be expected from the inspection.

“What do they want?” Do they want us to destroy a $ 900 million investment? ”Vucic asked, reiterating his support for those who want Chinese investment, saying they are stabilizing the region through job creation.

The role of the European Union

Until recently, the Western response to Chinese influence in the region was minimal. Only recently have European officials considered some investments in the Western Balkans as part of the response to the Chinese One Belt One Road initiative. Such is a $ 46 billion fund to be invested in technology and infrastructure in the region.

But Igor Novakovic of the Belgrade-based Center for International and Security Affairs says EU funds are often more difficult to obtain than Chinese funds.

“Based on the old Serbia-China cooperation, the money was provided quickly and the work was done quickly, but there are still questions about the price and the negative aspect for the environment,” he told VOA. “Cooperation with the EU is slow but rigorous.”

Economic consultant Jens Bastian says China often focuses on public infrastructure projects that have been rejected or not implemented by EU factors.

“China is moving to Southeast Europe to invest, because others have not,” Bastian told VOA. “Beijing is strategically determined to stay in the region for a long time.”

Montenegrin financial consultant Milos Vukovic says the shock caused to Podgorica’s public finances by a loan under the Chinese One Belt One Road initiative, a $ 1 billion project that was procured without a tender and raised national debt on gross domestic product. should serve as a strong warning to neighboring countries endangered by Chinese diplomacy that a trap was set through loans.

If Montenegro fails financially, Mr Vukovic said, public assets, such as the country’s electricity grid or industrial ports, could be turned into collateral for debts to China.

“Later, if we can not pay, they may say, ‘We will take over the state-owned energy company.’ [dhe] “We will invest in renewable energy,” he told VOA. “So they’re replacing the unprofitable project for them with a profitable project – and we know that energy is the future, especially renewables.”

University of Belgrade economist Ivan Vujacic, Serbia’s former ambassador to the United States from 2002 to 2009, said regional corruption, especially domestic political elites deliberately misinterpreting Chinese loans as investments, blamed part of the funded projects. from China that endanger state assets, workers’ rights, or the environment.

“I suppose investments [që Kina ka] calculated, bring benefits and… that they are towards achieving a result [fitimprurës]”, Said Mr. Vujacic, referring to China’s purchase in 2018 of a debt-laden copper mine in Bor.

“As far as Serbia is concerned, I assume and hope that the feasibility studies have been done properly and will yield results,” he said. “But we have no guarantee for that.” / VOA /

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