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China's spreading influence in Eastern Europe worries West

AP  |  Belgrade (Serbia) 

Coal-powered plants, mobile networks, major bridges, roads and railways: Chinese investments have been booming throughout Central and Eastern Europe's cash-strapped developing countries, even as officials scramble to counter Beijing's mounting economic and political influence on the continent.

EU member is hosting a summit Thursday between and 16 regional countries the 8th so far that focuses on expanding business and other links between and the region, which sees as a gateway into

The gathering in Dubrovnik of the so-called 16+1 initiative consists of Central and Eastern European countries that have endorsed China's ambitious global "Belt and Road" investment project, which has triggered concerns among some key EU states about increased Chinese political and economic clout in the region.

has already invested billions of dollars in various infrastructure projects in Central and Eastern Western leaders worry that further investment in the states that are EU members or those hoping to join could mean lower environmental and other standards than those in the rest of the bloc.

Thorny issues include the flouting of EU competition rules, potential over-borrowing by some of the states, the quality of constructions, and security concerns over high-supplied by Chinese companies.

Critics also say that in return for allowing Chinese expansion into the region, should give better reciprocal access for European companies to Chinese markets.

Top Chinese officials have sought to alleviate EU fears of unfair competition from Chinese state-controlled companies, which benefit from the government's financial backing. Chinese agreed during a recent visit to to work with European leaders to seek fairer international trade rules.

Of the 16 participating countries Albania, Bosnia, Bulgaria, Croatia, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Macedonia, Montenegro, Poland, Romania, Serbia, Slovakia, and 11 are EU member states, and the remaining five want to join.

has marketed its expanding initiative as a way to give some of Europe's neediest countries a financial boost, helping them gain access to more trade and investment. That has been mostly welcomed by the Central and Eastern European nations.

Linda Tjia, an expert on Chinese development strategy at the City University of Hong Kong, said there is no evidence to support concerns that Beijing is harboring "neo-colonial" goals to exploit Eastern Europe, and other developing economies.

European leaders "have to somehow show their people they are trying to protect national interests," Tija said.

Major Chinese-led infrastructure projects in the region include a planned high-speed railway from the Hungarian capital, Budapest, to in neighboring The line will link up with the Chinese- controlled in as an entry point for Chinese goods to Central and Eastern

The project has drawn scrutiny from the EU because Chinese state-owned banks would provide financing, and Chinese companies would and the actual building. That conflicts with EU rules requiring public works to be broken into segments small enough to attract multiple bidders.

Hungarian Viktor Orban, whose own government often has been criticized for anti-democratic policies, says Hungary's relations with China should be based on "mutual respect." last year did not sign an EU report criticizing China's human rights record and business policies.

In Serbia, an EU membership candidate, Chinese companies are building major bridges and highways. They are also constructing a even as China is trying to curb pollution at home by implementing and reducing the use of lignite, by far the most polluting fossil fuel.

Serbian said the strategically-located Balkan country situated between East and West is a perfect place where "China can realize its economic concept, the way it wants to enter (Eastern European) markets," without much concern over fair bidding processes or pollution standards.

Bosnia, a potential EU candidate, is at odds with the bloc over its decision to issue a public guarantee for a USD 676 million loan from China's to expand Bosnia's largest coal-fired power plant.

EU's has warned that the move could eventually harm Bosnia's bid to join the EU because the agreement violates EU's subsidy and environment rules.

has said the issue "raises serious questions" about the Balkan country's "commitment to international treaties (and) European rules."

Chinese companies are also involved in the construction of a USD 380-million in Croatia, which links two coastal parts over the Sea, as well as a highway linking the in to neighboring

In the Czech Republic, the followed U.S. authorities' warning against the use of hardware or software made by Chinese companies and

That, however, did not change Czech Milos Zeman's positive stance toward Zeman publicly criticized the Czech watchdog, saying it harms the Czech Republic's business interests as it could affect Huawei's plan to invest USD 370 million in in the U.S. officials mounted an international campaign to keep gear out of any that might carry sensitive

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, April 11 2019. 10:05 IST
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