There are clear signs that the 17 Central and Eastern European countries are cooling off towards China, Emilian Kavalski, professor in China-Eurasia Relations and International Studies at the University of Nottingham tells CNBC-TV18. “One clear example is that the annual summit that China has with the CEE countries has not taken place and very likely will not take place.”
The official reason, he says, is the pandemic, but few of these countries have pushed for some online summit either. “The unofficial reason is that most CEE countries do not want to have the summit before the EU-China summit which was scheduled for September, and now has been postponed indefinitely,” says Prof Kavalski.
Many of these countries are also members of the European Union (EU), and are likely to take their cue increasingly from the EU, Prof Kavalski says. “Increasingly East European countries are becoming more aligned and waiting for Brussels to find a common strategy and policy towards China. Once the policy is formulated, those countries are very much going to fall in line and follow that strategy.”
The CEE bloc includes countries such as Poland, Romania, the Czech Republic, and also countries such as Hungary and Serbia that have been more keen on China than the others, and to some extent still are. The bloc includes crucially Greece which joined late last year. The Piraeus port in Athens has been extensively, and rapidly, developed by China to send goods into Western Europe as a vital outlet in its Belt and Road Initiative.
Criticism, not Investment
That initiative was launched aggressively in this region in 2012. “Most of these countries were never very keen on China, though many among them were curious,” Kavalski says. “Like many countries they wanted to profit from the economic bonanza promised by Chinese investments, and from access to Chinese markets.”
The summits brought little investment.
“A lot of countries were interested in Chinese investment, and this investment, unfortunately both for them and for China did not materialise,” says Kavalski. “So the Czech President announced publicly that he won’t be taking part in this year’s summit planned for April because of lack of investment,” Kavalski says. “While there has been an increase in investment, there hasn’t been a strategically significant investment. Many of the projects were on the drawing board before the current cooling off.”
Instead of investment, Kavalski says the CEE countries have received criticism, mainly from Brussels and Washington. “And EU member states are still the main investors.”
The criticism is now beginning to bite. “The technological cold war between China and the US is already having repercussions. Washington has been putting pressure on CEE countries to ban Huawei and Chinese technological companies from participating in 5G networks. So countries such as Poland, the Czech Republic, Romania and Estonia have already indicated that they will ban Huawei.”
The CEE is now emerging as “a playground for the technological cold war emerging between China and the US,” Kavalski says. Latvia has become the first of these countries to declare China a threat to its national security.
The setback to China’s Belt and Road Initiative, an infrastructure development plan where China has set a lead role for itself in about 70 countries and international organisations, goes well beyond the CEE itself, says Kavalski. The plan envisages an economic belt through Central Asia into Europe. Also, the maritime Silk Road through the Indian Ocean and the Mediterranean need to pass through CEE. “So it is significant for China for being at the crossroads.”
The significance, Kavalski says, increased after the Chinese company COSCO acquired Piraeus port in Athens. “It quickly became the second-largest container ship port in Europe (after Rotterdam). Goods to Europe from Piraeus need to go through Eastern Europe.” Now the future of the Belt and Road Initiative, he says, “will depend on how China’s interest in CEE nations will develop.”
The pandemic, and the economic pressures it has brought, will further set back China’s plans for the region, says Kavalski. “It’s likely that as a result of the pandemic and a need to relocate strategic resources domestically in China, the future of the Belt and Road Initiative will be much more lean and narrow in scope than it was till 2020.” China, he says, “needs to revive its economy, and there’s also a lot of domestic pressure and criticism over splurging money overseas.”The virus, Prof Kavalski wrote earlier in The Conversation, has only accelerated the social distancing between the CEE and China.