Serbia is becoming a client state for China

According to a new analysis by the US Center for Strategic and International Studies (CSIS), China’s economic activities have strengthened Serbia’s support for Beijing’s official foreign policy, especially in the areas of territorial integrity and human rights. Furthermore, in strategically important sectors, Chinese companies are using Serbia to expand their influence in the region and access the EU market.

The analysis entitled “Becoming a Chinese client state – the case of Serbia” assesses that the problems of cronyism and the corrupt system of public administration in Serbia represent an additional space for strengthening influence.

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“The SNS’ near-total control over the state and administrative apparatus creates a strong party patronage networks that ensure economic resources are politically controlled and allocated to loyal beneficiaries. Nontransparent political and economic structures make it easier to sign contracts and push through projects without concern for EU or OECD rules, further enriching the same local elites who maintain power by controlling the levers of economic development,” the report states.

This is particularly evident in large infrastructure projects, but also in the energy, transport and digital sectors in Serbia.

According to the CSIS survey, 93% of China-funded projects in the Western Balkans had Chinese suppliers or Chinese companies as subcontractors.

Also according to the CSIS, China is gradually squeezing out Russian influence in Serbia, which could make Serbia’s path to the EU membership more difficult, even though official Beijing would benefit more in the long term if Serbia became an EU member.

“Working with its allies, and the European Union, in particular, the United States must pursue a strategy that simultaneously exposes the untruths and contradictions of Chinese economic and political engagement in Serbia, mitigates current and future Chinese influence activities and presents a positive transatlantic agenda that highlights transparent investment, economic benefit, rigorous oversight and accountability and civil society engagement,” the reports states.

According to the CSIS, this could be achieved through educational campaigns on the economic and environmental consequences of Chinese investments and the objectives of official Beijing, but also by highlighting the importance of the financial assistance that the West provides to Serbia.

The cooperation of Chinese technology companies with Serbian stakeholders is a springboard for further expansion in the region, and efforts in the IT sector include the construction of smart cities, data centres, 5G networks and installation of optical cables.

Of the 18 projects implemented by Chinese IT companies in the region, 14 are located in Serbia and 40% were initiated during or after 2019.

“The transatlantic community is already lagging behind in understanding the extent of Chinese influence … The direction in which Serbia goes will affect the entire region, which is why it should become a priority for US decision-makers,” the report concludes.

(Nova Ekonomija, 02.10.2020)

This post is also available in: Italiano

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