- Posted by Christopher Ledsham
- On 29th June 2016
- CEE, investment, One Belt One Road, Serbia, state visit
Chinese President Xi Jinping strengthened his country’s political and economic ties with Serbia this month, following the signing of 22 trade and investment deals during a state visit to the Balkan state.
The three-day trip, which took place following Serbian Prime Minister Aleksandar Vučić’s cancellation of planned visits to Washington D.C. and Brussels, was the first to Belgrade made by a Chinese leader in 30 years. The two countries’ relationship has flourished in recent years following the signing of a bilateral strategic partnership in 2009 – the first between Beijing and a Central and Eastern European (CEE) state – which has seen China invest more than USD 1 billion into Serbia, predominantly in loans in the infrastructure and energy sectors.
Accordingly, based on these already-strong partnership foundations, Serbia, like many other CEE states is likely to be a key beneficiary from China’s One Belt, One Road strategy.
Speaking at the Smederevo steelworks, which were bought by Chinese firm Hesteel in April 2016 for EUR 46 million (USD 51.1 million), Xi announced that: “[We] are developing the One Belt, One Road project … with its position and advantages Serbia will have a significant place in this.” He further added “This cooperation should be an example of Chinese cooperation with countries in Southern and Eastern Europe.” Prime Minister Vučić also revealed that talks regarding the potential establishment of a free trade zone in the town of Smederevo, home of the eponymous steel manufacturer, were also underway.
During his visit, Xi, alongside President Tomislav Nikolić, also attended a memorial ceremony at the location of the former Chinese Embassy in Belgrade, which was bombed by NATO forces during its aerial campaign against Yugoslavia in May, 1999. The occasion also served as the official renaming of the site to the “Serbia-China Friendship Square”, while the adjoining street will now become “Confucius Street”. The Chinese leader also laid the cornerstone for a forthcoming Chinese Cultural Centre.
Following his three-day stay in Serbia, Xi also made state visits to Poland and Uzbekistan, where he attended the 6th Meeting of Heads of State Council of the Shanghai Cooperation Organization (SCO) in Tashkent.
As China’s growth slows and its economy continues to transition from a predominantly export-led to a consumption-driven model, the One Belt, One Road framework is seen as a means of allowing Chinese companies to invest overseas, as well as to encourage geopolitical cooperation between China and a number of states worldwide. This strategy is also being complemented by the Asian Infrastructure Investment Bank, which began operating in January 2016 and counts states as diverse as Australia, Germany, Russia, India, the UAE and Indonesia amongst its founding members.
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