What the future holds for Central and Eastern European-China relations
Central and Eastern Europe become hawkish on China
In recent years, Central and Eastern Europe (CEE) have become increasingly hawkish in their attitude to China. Economic, political, and security concerns drive this shift in attitude. It seriously affects the region’s relations with the world’s second-largest economy.
This article will explore the drivers behind this shift in attitude and the potential implications for CEE-China relations.
Overview of current Central and Eastern European-China relations
Central and Eastern European (CEE) countries are increasingly becoming a part of China’s Belt and Road Initiative (BRI), a multibillion dollar effort to expand and deepen economic, political and cultural ties across Asia, Africa, the Middle East, and Europe. Since their emergence from state socialism in 1989-1991, many CEE countries have sought to build more comprehensive ties with the global economy. Historically, this path has meant gradual but convergent integration with Western economies — both politically and economically — although this trend has started to change in recent years as CEE countries have established more meaningful links with China.
For these further efforts to produce successful outcomes for both sides, governments should consider current levels of economic engagement between themselves and Beijing on equal terms. This includes the development of free trade agreements (FTA) that cover goods and services. It also requires rethinking existing trade regimes by emphasising Chinese companies’ access to foreign markets while continuing to protect domestic industry through anti-dumping measures or tariff-rate quotas that favour domestic firms over foreign ones. Furthermore, CEE states must strengthen procedures related to helping Chinese investments flourish within their borders by establishing investment protection agreements that ensure mutual respect while protecting local interests if investments do not turn out profitable or if other unpredictable events arise.
Finally, governments should pay particular attention to developing data collection systems to better track how Chinese investments perform within their countries; using this data can be extremely helpful in setting organised policy changes yet still ensuring appropriateness regarding foreign investment opportunities from China.
The past years has seen the emergence of a new dynamic in Central and Eastern Europe’s relations with China, with countries such as Poland, Hungary and Czech Republic now taking a hawkish approach to the country. This shift in sentiment has been particularly visible in the economic relationships between the two regions.
This article will explore the potential long-term implications for Central and Eastern European-China economic ties in light of this new geopolitical landscape.
China’s investments in Central and Eastern Europe
China’s investments in Central and Eastern European countries remain substantial despite the overall decrease of these countries’ share in total Chinese investments worldwide. Although China invested significantly more abroad in 2014 than it did five years earlier, its direct investment into Central and Eastern Europe decreased by 10 percent. Nevertheless, Chinese owned companies remain an important part of the economic landscape of many Central and Eastern European countries.
Recent years have seen China become increasingly involved in various areas such as energy, infrastructure, finance and technology. According to newly released data from 2018, energy remains the main sector for foreign investments from China in this region with over $17 billion invested from 2010 to 2018. Other prominent sectors include transportation infrastructure, industrial parks and logistics with significant amounts invested.
Financial services are also a growing area of Chinese investments into this region with especially large amounts going towards projects such as domestic infrastructure development or other ventures like financial institutions offering credit or financing for small businesses. Furthermore, technology related investments have lately been on the rise mainly through venture capital activities but also due to partnerships between Chinese companies and E-commerce platforms based on local companies within CEE countries.
It is clear that while large scale projects form the basis of Chinese investments into this region there has been a shift towards more diverse small scale deals focusing on bridging different aspects such as industry, environmental protection or energy production within CEE marketplaces The long-term outlook for Sino-CEE economic relations does remain hopeful given the overall growth trajectory of CEE economies and collaboration opportunities available for both sides to benefit from mutual development initiatives aiming at connecting East Asian economies with Europe both geographically economically.
Central and Eastern Europe’s reliance on Chinese technology
The growing economic relationship between Central and Eastern Europe (CEE) and China has been increasingly visible in the past few decades. This can be attributed to significant Chinese regional investments, large-scale infrastructure, energy and transportation projects, more frequent high-level meetings, and a full suite of bilateral dialogues. As a result, the two partners have effectively established bi-regional ties that allow increased cooperation in many sectors.
One particularly integrative element of this economic partnership is technology transfer from China to the CEE. This is evidenced by the Chinese telecom equipment supplier Huawei building a production centre in Poland, its largest customer base in Europe; Czech companies receiving long-term investment from China’s automotive sector; Hungary’s SINOCENT media company launching one of China’s biggest online stores; and Bulgaria working towards building an economy based on metropolitan class industrial parks supplied by digital technology firms. In addition, major tech brands such as Xiaomi or Huawei have authorised online sales outlets across the CEE countries. Their products are sold directly on local websites with appropriate customer service and warranties following EU standards.
In light of these developments, it is safe to say that Central and Eastern Europe has become increasingly reliant on digital technology sourced from China – be it for infrastructure projects or products offered directly to consumers. However, it remains to be seen how far this reliance will go as relations between both regions evolve.
Central and Eastern Europe is becoming more interested in China’s increasingly influential role in the region, particularly its Belt and Road Initiative plans. This means political relations between Central and Eastern Europe and China will likely become increasingly complex.
This article will explore the challenges and opportunities involved in this relationship, from the perspective of Central and Eastern Europe.
Central and Eastern Europe’s increasing wariness of China
In recent years, Central and Eastern Europe (CEE) countries have become increasingly wary of investing in Chinese technology or infrastructure. This scepticism is partly grounded in worries of digital or economic espionage. It has been exacerbated by growing geopolitical tensions over the U.S.-China trade war and other issues surrounding the political relationship between China and CEE nations.
The most prominent “political” issue raised by CEE governments concerning China has been the threat posed by the Belt-and-Road Initiative (BRI). Several nations, including Latvia, Romania, Bulgaria, Hungary, Czechia, Slovakia and Poland have voiced their concerns about BRI’s political implications for their security. In addition, countries in the region are concerned that Chinese investments of money and resources could be used to extend Beijing’s political influence at their expense.
In addition to this more explicit political tension between CEE countries and China, underlying economic issues have generated distrust in Beijing’s policies. Most notably, there is a perceived lack of reciprocal trade deficit between Beijing and CEE countries and a feeling that China is taking advantage of relatively low labour costs abroad while providing limited benefit to local economies. This sentiment appears to be particularly pronounced among younger generations in countries such as Hungary, Poland and Romania who can sense what they believe is unfairness on the part of Chinese investments into their country.
These simmering tensions may soon come to a head if decisive government action isn’t taken to counteract them. However it remains to be seen how these kinds of disagreements will ultimately shape future relations between Central & Eastern European states and China.
Potential for conflict between Central and Eastern Europe and China
The potential for conflict between Central and Eastern Europe (CEE) and China is real but often downplayed or overlooked. The two regions have different political systems, economic models, and foreign policies. As CEE countries become more embedded in global politics, their regional interests could directly oppose China’s growing influence.
Regarding politics, CEE countries tend to favour democratic values and human rights over authoritarian rule by the state. They uphold the principles of an open society, rule of law, and liberal economic policies. In contrast, China has adopted a system characterised by strong state control that has been generally resistant to change. This means there could be tensions around issues like media freedom and market openness if China’s policies threaten trade stability within the region or infringe on their democratic principles.
Economically, CEE countries have recently experienced tremendous growth in industries such as technology manufacturing and engineering services; however this may be threatened by Chinese firms who can underprice domestic products due to cheap labour costs and supply chain advantages in cheaper markets outside of Europe.
The relationship between Central European nations also has potential for chilling ties with China due to security concerns over its Belt Road Initiative (BRI), a proposed vast network of infrastructure projects extending from Asia to throughout the continent including parts of Central Europe. The project is seen as a long-term challenge not only for individual economies but for global geopolitics in general — one that could result in increased security risks at the national level if unchecked spending brings about greater strategic or economic dependence on Beijing.
Finally, there are policy differences between China and most CEE countries concerning foreign relations with Russia; while some members defend dialogues with Moscow against US sanctions, others take a hard line against what they see as Moscow’s regional ambitions. This divergence could impair regional unity if Beijing does not respect certain countries’ sovereignty regarding bilateral partnerships with Russia.
As the relationship between China and Central and Eastern European countries (CEEC) is increasingly strained, security has become a growing concern for these countries.
In light of recent geopolitical tensions between China and the United States and increasing Chinese investments in the region, many CEECs have become increasingly wary of China and its potentially destabilising effects on the security of the region.
This article will explore how these security concerns play out in the relationship between CEECs and China.
Central and Eastern Europe’s concern over Chinese influence
Central and Eastern European states have had considerable success in pursuing a closer relationship with the European Union and other Western countries in recent years. However, there has been a growing concern over Beijing’s influence in the region, leading to increased security discussion. In particular, many Central and Eastern European states are concerned about China’s intentions towards their region, its military capabilities and potential implications for their national security.
China has tried to build strong ties with Central and Eastern Europe as part of President Xi Jinping’s Belt and Road Initiative (BRI). Beijing has sought to cement relationships with CEE states through investments, trade delegations and hosting summit meetings like the 16+1 platform for dialogue between China and sixteen CEE countries. Although such activities could be conducive to economic development, many analysts are sceptical of China’s true intentions to use the BRI as a tool for geopolitical control or even military deep penetration.
Military concerns have also arisen due to increased Chinese presence in various areas across Europe such as along maritime routes connecting maritime nations including Greece, Cyprus and other islands surrounding Malta, a key shipping route connecting Europe Africa to the Middle East. Still, there is concern more broadly Chinese investment activity such as in areas critical infrastructure nuclear energy communications technology have also raised safety security concerns.
Overall Central and Eastern European states recognize that increasing economic ties with China offer rewarding opportunities. At the same time, they are conscious of potential risks that arise from greater proximity with a strategic competitor. National governments must find ways to maintain prosperous economic relations with China without placing their national interests at risk by further deepening dependence on Chinese investment or technology if this trend continues could lead at least partial reorientation away from towards the United States EU which might eventually hurt current level cooperation between Central Eastern Europe-China relations.
Potential for a military conflict between China and Central and Eastern Europe
While the relationship between Central and Eastern European countries and China has seen significant changes in recent decades, military conflict remains highly unlikely. This is due to the technological gap between both sides, China’s military superiority, and Central and Eastern Europe’s commitment to the European Union.
Contrary to popular belief, most current Chinese investments in Central and Eastern Europe are not focused on military capabilities nor do they pose a threat to regional security. On the contrary, some of the investments that have been made benefit regional security. For example, Chinese companies have invested in telecommunications infrastructure and 5G mobile networks which can improve internet access and help support regions’ digital economy.
Other investment areas include green energy projects such as solar farms and infrastructure upgrades like redesigned ports for shipping purposes. These investments demonstrate a commitment from China to support growth in the region without any implications of militarization.
Overall, while there might be potential for conflict or tension between China and Central and Eastern European countries, it is unlikely that this conflict would take the form of a military one due to technological gap about which has been stated above combined with other factors mentioned previously.