China comes to the Western Balkans! A Problem?

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Chinese investment in the countries of the Western Balkans to grow from year to year. Critics speak of the danger of political influence in Beijing. Hardly one says to the other, wherein the exist should be.

A successful investment: the port of Piraeus

If in the Western media of the need for European Integration of the countries of the Western Balkans, to be held in the various concerns in the field. All of these countries, Macedonia, Bosnia-Herzegovina, and Montenegro, Kosovo or Serbia, are mainly perceived as a source of problems. At the same time, the Western Balkans is seen as a stage for geo-strategic conflicts of the so-called “big players”.

To the traditionally Large, such as the EU or Russia, China, locates in the last few years, yet another important player as active and engaged:. The Land is identified as an active Power in Southeast Europe. China track “geostrategic interests” in Southeast Europe, the fee is a fear, especially in Brussels. All the danger warnings remain strangely diffuse, hardly anyone tries to define the concrete political advantage, the China of a commitment to the Western Balkans.

China is a capitalist on the world market

Quite different is the diagnosis when one examines the economic interests of China in this Region. 2013, Chinese President Xi Jinping unveiled his “One Belt, One Road”strategy, also known as the “New silk road”. It provides for the realization of various infrastructure projects, with the aim of allowing a rapid and cheap Transport of Goods and services from China to the rich markets of Western Europe. As an important transit route to the countries of South-Eastern Europe, so that one also speaks of a “Balkans Silk Road”.

The first major investment in this way was made in Greece. In 2009, the large Chinese shipping and port operator COSCO had invested more than 650 million Euro, and a little later 280 million euros, in order to secure the majority share of the port of Piraeus. It was a very successful economic investment: while ten years ago the harbour was only the Top 20 of the busiest in Europe, he belongs in the Top 10 and the opening of a new terminal was imminent.

Chinese Economic Stimulus Program

Bridge in Serbia: Chinese money, Chinese construction companies, Chinese workers and Chinese construction material

In the meantime, Chinese companies invest in all of the countries of South-Eastern Europe. Overall, it is a two-digit billion sums. It is important to distinguish between direct investment on the one hand – such as in Piraeus and the award of relatively cheap loans to Chinese state banks on the other. The second type of engagement is much higher, says Jens Bastian, an independent economic analyst and one of the best connoisseurs of Chinese activities in Southeast Europe. “With the exception of Greece and Serbia, all other countries in the Region mainly to cheap loans for the respective governments”, says Bastian.

In this case, this lending will be linked to templates, so that a “closed-end credit cycle”: Chinese banks give the money under the condition that Chinese companies get the contracts. They bring in Chinese workers and the Material from China to the country, to build a bridge or a highway in Montenegro, Bosnia-Herzegovina or in Croatia. “This is a kind of stimulus program for the Chinese economy, Overcapacity has,” says Bastian.

Objective: To Western Markets

The Chinese economic interests are clear: The Belt and Road strategy is aimed at the economically strong Western markets, South East Europe is an important transit. Thus, the countries of the Balkans act as a kind of “gateway to Europe”. Therefore, it is invested mainly in the infrastructure: roads, bridges, railway lines, ports.

However, the total volume of these investments is relatively low. “If you look at how many resources the EU in the framework of various credit programs for Bosnia-Herzegovina, Kosovo, Serbia, Croatia or Hungary, we can see that these are much larger sums of money, as China willing and able to invest,” says Bastian.

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And, the large difference in the amount of China’s investment is, if one compares the countries of the Western Balkans with those in Western European countries. Chinese companies have large interest, particularly in highly-developed technology and are ready to dig deep in the bag. While the largest previous investment in the Balkans, the port of Piraeus, suggested zubuche with less than one billion euros, was the Acquisition of the German robot manufacturer Kuka in the year 2016, Chinese investors 4.5 billion euros.

In Germany alone, the Chinese have invested in the last year of 13.7 billion euros – a record so far. At the same time you have to make the investment in the other direction. The result is clear: so Far, the total investment of German industry in China amounted to approximately 70 billion Euro – twice as high as Vice versa.

The Chinese capital and the cautious West

It is the classic capitalist investment flow in the context of a global market. All of the invest your money where it pays the most. And all have the same goal: to position themselves as well as possible on the global market and to generate as much Profit as possible. Whether you invest in China, in Germany or in the countries of South-Eastern Europe, plays a rather minor role.

However, it is so that the economically strong countries of the West in General have better possibilities to protect the so-called “sensitive areas” of your business. So, the German government has prevented two years ago, the Acquisition of the Chip components manufacturer Aixtron by Chinese investors.

Only Business – not a moral sermons

The governments of the Western Balkan countries have a much more difficult position, since they are often much more dependent on the investment from China, says Jens Bastian: “China is looking for in this Region is the economic partners, which have a weak negotiating.” This allows Beijing to create new transport routes for relatively small amounts,” says Bastian.

Networking: the summit of the heads of government of Central and Eastern European countries and China in Riga in 2016

However, it is not clear whether and which political Agenda with these investments. “China has no interest in – to promote different Russia – a regime change in these countries”, says Bastian. It seems that the geo-strategic Chinese interest in South-East Europe is primarily economic – as a transit route to the rich Western markets. China keeps anybody lectures on human rights or freedom of the media, will be taken by the governments in the Western Balkans more as a welcome Bonus to the knowledge.