China's infrastructure diplomacy runs into headwinds in central and eastern Europe.
The Belt and Road Initiative (BRI), China’s long-term global infrastructure investment effort to connect Asia and Europe—and buying power and influence along the way—is running into problems in Eastern Europe.
In February, Bucharest announced that it was banning investment in infrastructure projects by non-EU countries that don’t have trade agreements with the EU, a veiled reference to China. Romania has in recent months kept Chinese money out of its telecommunications and nuclear power industries.
And it’s not just Romania. The same month, half of the 12 EU members of the 17+1 forum, the platform that China put together in 2012 to develop ties with countries in Eastern and Central Europe, declined to send their presidents to the latest meeting of the group, despite heavy pressure from Beijing.
Lithuania took multiple steps to prevent Chinese companies from taking part in some procurement projects. The Czech Republic, Croatia and Slovenia have also derailed efforts by China to participate in public tenders for shipping, railway, nuclear power and road construction. Poland has complained about Beijing dragging its feet on expanding access to Chinese markets. And Greece came to the decision that it will allow Chinese shipping giant Cosco to increase its majority stake in the port of Piraeus, the country’s largest port.
Distrust of Chinese investment has been a major challenge for the BRI. The US Foreign Policy Research Institute pointed to rising dissatisfaction in a web paper last fall: “Government officials have complained about China’s use of ‘debt-trap’ diplomacy and predatory lending.” But Central and Eastern Europe have been especially forthright in resisting Chinese courtship and cash, perhaps thinking back to the days of the Warsaw Pact.
What’s more, countries in the region still have half an eye on Russia. They rely on NATO security guarantees, and most of the 17+1 are members of the EU. If push comes to shove, promises of Chinese investment may pale in the face of broader geopolitical and strategic concerns.