In 2014, China’s Belt and Road Initiative (BRI) began expanding into the Balkans, significantly increasing the region’s strategic importance. Starting from the Greek shores and extending to Central Europe via the Vardar River, the trade route plan offers promising opportunities for the small economies in the region. However, the European Union (EU) has exerted pressure to deter the initiative, citing concerns over China’s growing influence in the area. Despite this, China continues to expand its economic activities across the region.
The first Confucius Institute in the Balkans was established in Belgrade in 2006, followed by the opening of additional institutes in other Western Balkan countries. Moreover, China has developed a media presence in the region to promote the Belt and Road Initiative. Various scholarships and research partnerships have been initiated in Serbia, North Macedonia, and Montenegro. Additionally, China has introduced visa-free travel arrangements for numerous countries in the region, further facilitating its engagement.
Serbia stands at the forefront of China’s economic partnerships in the Balkans. [1] The historical context of their relationship, particularly during the Kosovo conflict, where the Chinese embassy in Belgrade was struck during NATO’s 78-day bombing campaign, has fostered what is now described as an “iron-clad friendship.”
Over the years, this relationship has deepened, with approximately 30 agreements signed to promote a “common future,” significantly advancing bilateral relations and economic cooperation. [2] One of the earliest notable investments was the acquisition of Zelezara Smederevo, Serbia’s sole steel plant, by the Chinese Hesteel Group in 2016. This investment alleviated concerns among both employees and the government at a time when the facility faced operational challenges. The plant had previously been owned by an American company from 2003 until the economic downturn of 2008, after which China’s intervention saved it from closure, bolstering China’s image in Serbia. Following this investment, China has increasingly concentrated on infrastructure development within the country.
The Belgrade-Budapest Railway Project, launched in 2021, exemplifies China’s largest infrastructure initiative in the region. Constructed by China International Railway, the project links the capitals of Serbia and Hungary and is envisioned to extend southward to Athens. This development represents a significant advancement for the Belt and Road Initiative, marking another critical milestone in China’s strategic expansion into the region.
In addition to Serbia, Montenegro is another Balkan country that has developed high-level relations with China. Since gaining independence in 2006, Montenegro has actively sought to diversify its economy by attracting foreign investment. China has played a key role in this effort, undertaking several significant infrastructure projects. One notable example is the construction of the Boljare Highway, which connects Bar, Montenegro’s main port, to the easternmost regions of the country and extends to Belgrade. The modernization and enhancement of Montenegro’s railway network are also included in these initiatives. China’s presence in Montenegro extends beyond infrastructure to include the energy sector. A prominent example is the construction of the Pljevlja Coal-Based Thermal Power Reactor, completed by the China-based Dongfang Electric Company. These projects reflect China’s growing influence in Montenegro and its integration into the broader framework of the Belt and Road Initiative.[3]
Albania is regarded as one of the most strategically significant countries for China among the Western Balkan nations. With its advantageous location and ports along the Adriatic coast offering attractive opportunities for trade, Albania is anticipated to witness a substantial increase in Chinese investments. Similarly, Bosnia and Herzegovina ranks as a key destination for Chinese investments in the region, second only to Serbia. China has established a prominent presence in the country through its significant contributions to transportation and infrastructure development, the construction of hydroelectric power plants such as the Vranduk and Neretva projects, and the establishment of production facilities. Furthermore, China continues to provide incentives across a wide range of sectors, underscoring its commitment to deepening economic engagement in the Western Balkans.[4]On the other hand, the Chinese company COSCO has emerged as a major port operator by acquiring a significant share of the Port of Piraeus in Greece. This investment is intended to enhance China’s access to Europe and strengthen its logistics networks.
As participants in the Belt and Road Initiative, these countries are profoundly influenced by economic partnerships that significantly impact the development of both individual nations and the region as a whole. Economically smaller nations in the region, such as those in the Western Balkans, derive substantial benefits from these collaborations, which play a critical role in their development.
In summary, China’s investments in the Balkans have grown substantially in recent years. Viewing the Balkans as a strategic bridge to Europe, China has undertaken various initiatives to strengthen its economic ties with countries in the region. A significant focus has been placed on developing transportation infrastructure, including roads, railways, and ports, with Chinese construction companies both financing and managing these projects. Furthermore, China has made considerable investments in the region’s energy infrastructure, primarily targeting coal and hydroelectric power plants. Additionally, it has demonstrated increasing interest in renewable energy projects, reflecting a broader diversification of its investment portfolio.
As a result, China’s investments in the Balkans are primarily shaped by the framework of the Belt and Road Initiative, a global strategy designed to enhance China’s economic connections on a worldwide scale. Given the Balkans’ strategic location along this route, China has been making substantial economic and trade investments in the region. Its growing economic influence in the Balkans is driven by infrastructure projects, energy investments, and trade agreements. These efforts not only contribute to the economic development of the countries in the region but also strengthen the diplomatic and economic ties between China and the Balkan nations.
[1] Kristinovska, Ana (2024), “Western Balkans ‘Economic Cooperation with China: Between Positive Conditionality and Economic Coercion”, CHOICE, https://chinaobservers.eu/western-balkans-economic-cooperation-with-china-between-positive-conditionality-and-economic-coercion/, (Accessed Date: 02.12.2024).
[2] Foreign Affairs Committee. (2022). “China Regional Snapshot: Western Balkans”, https://foreignaffairs.house.gov/china-regional-snapshot-western-balkans/, (Accessed Date: 02.12.2024).
[3] Zeneli, Valbona. (2022). “China In The Balkans”, per Concordiam, Journal of European Security and Defense Issues, https://perconcordiam.com/china-in-the-balkans/, (Accessed date: 12.02.2024).
[4] Ibid.
