China’s economic activities have strengthened Serbia’s support for official Beijing’s foreign policy, especially in the areas of territorial integrity and human rights issues. In addition, Chinese companies in strategically important sectors will use Serbia to expand their influence in the region and access the EU market, according to a new analysis by the US Center for Strategic and International Studies (CSIS).
The analysis entitled “The Emergence of the Chinese Client State: The Case of Serbia” estimates that the problems of clientelism and the corrupt system of public administration in Serbia represent additional space for building influence.
“Almost complete control of the state and administrative apparatus by the Serbian Progressive Party forms a strong party network, which ensures that all economic resources are under political control and focused on (the most loyal). Non-transparent political and economic structures facilitate contract signing and project implementation regardless of EU or OECD rules, which further enriches the local elites that are in power by controlling the levers of economic development,” the analysis states.
This is especially noticeable on large infrastructure projects, but also in the energy, transport and digital sectors in Serbia.
According to a CSIS survey, 93 percent of Chinese-funded projects in the Western Balkans had Chinese suppliers or firms doing the work.
Due to all the above, according to the CSIS, China is gradually squeezing Russian influence in Serbia, which could make its path to the EU more difficult, although official Beijing would benefit more in the long run if Serbia became a member state of the Union.
In addition, China competes more with the EU in Serbia than it coordinates with it, which neither Brussels nor Washington “must neglect, given that the space for sharing is narrowing.”
“In cooperation with its allies, especially the EU, the United States should work on a strategy that will simultaneously expose the untruths and contradictions of Chinese economic and political efforts in Serbia, reduce activities to expand influence… and emphasize the importance of transparent investment, economic benefits, oversight, accountability and citizen involvement,” the recommendations state.
According to CSIS, this could be achieved through educational campaigns, about the economic and environmental consequences of Chinese investments, and the goals of official Beijing, but also the importance of financial assistance that the West provides to Serbia.
The cooperation of technology companies from China with actors from Serbia is a launching pad for further expansion in the region, and efforts in the ICT sector include the construction of smart cities, data centers, 5G networks, and optical cables.
Of the 18 projects implemented by Chinese ICT companies in the region, 14 are located in Serbia, and 40 percent of them started during or after 2019.
“The transatlantic community is already late in understanding the breadth of Chinese influence… Serbia’s direction will affect the entire region, which is why it should become a priority for US decision-makers,” the report concludes, Nova Ekonomija reports.
