BSF Panel 11: China and Serbia – Strategic Investment? (BFPE in Partnership with Center for International Private Enterprise)
- Why is it important to understand what corrosive capital is?
- What was the influence of Chinese investments in Central and Eastern Europe?
- What are the prominent sectors of the Chinese strategic investments?
- How did Serbia react on the rise of Chinese investments?
- What are the consequences of the Chinese investments to Serbian business sector and overall economy?
Over the past decade, the People’s Republic of China has increased its presence in Serbia dramatically. Economic relations, cultural exchange, but more increasingly political and security cooperation all present today different aspects of the Sino-Serbian relationship. Back in 2016, Serbia and China have signed a “Joint Statement on the Establishment of a Comprehensive Strategic Partnership”, and have continued ever since the practice of government-to-government relations. The staple of the relationship between the two are joint, strategic infrastructure projects in Serbia, financed with Chinese loans and implemented by China’s state-owned companies. From 2009 to 2020, Chinese loans earmarked for infrastructure projects in Serbia have amounted to 5 Bn EUR, expected to grow even further with a new memorandum of understanding and commercial contracts signed in the beginning of 2021.
A high level of centralization of power in Serbia, and the autocratic Chinese regime have created the context within which cooperation has remained unchallenged and developed on the basis of bilateral agreements between two governments and state actors, rather than through open and transparent procedures.
While there are certain short-term benefits of this relationship, Serbia has also been experiencing negative consequences that are cause for serious concern, especially if the relations continue to develop along the same trajectory. Chief among them concern the practice of direct deals; lack of transparency; “value for money” principle and public interest not being considered; lack of fair competition or studying the adverse effects on the environment.
The panel seeks to explore different aspects of the Chinese strategic insertion in the Serbian economic architecture, but also to pose the question of where does the Serbian entrepreneurs, companies and overall economy stands in relation to this rising Chinese presence.