Cross-border Talks discussed with Sorin Ioniță from the Romanian liberal NGO Expert Forum about the Chinese presence or rather absence in Central Europe and the Black Sea region. Ioniță explained how the hype in this region about Chinese investment has mostly been unjustified. He also commented on the Western economic engagement of China, which is undergoing as other parts of the West, more oriented towards security try to isolate Beijing. We don’t know China and projects such as Expert Forum’s China Watch contribute to a realistic perspective on the influence of the socialist state with market economy. China has had remarkable success in taking hundreds of millions of people out of poverty. But it doesn’t seem to have a project for the whole of humanity. It has a global project for its population.
Vladimir Mitev: Welcome to another episode of Cross-Border talks, where we continue to follow the current events in the world. We are today to deal with the issue of China and China’s presence in Central and Southeastern Europe, especially the region of the Black Sea. A number of contradictions have arisen with the expansion of China in the world. Apparently in the conditions of the war in Ukraine, the importance of China is also rising. Our region has always looked for different masters. So perhaps we we need to know, well, any master and China remains somehow unknown. Maybe not so much traditional partner for many of the countries here. So we will be having today as a guest Sorin Ioniță, who is a political scientist from Romania, associated with the Expert Forum, a leading liberal think tank. Expert Forum is realizing a project called China Watch that deals with the Chinese influence in the Black Sea region. And we have a number of issues to discuss about China in the world and in the Black Sea. Welcome, Sorin. And I pass the words to my colleague Veronica.
Veronika Sušová-Salminen: Hello, everybody. Thank you for your introduction, Vladimir, and thank you for your time for our talk. And I will start with one first general question, because I think the the rise of China is really a process which is new for the international relations and its history. At least since the time when Westphalian system expanded, we are probably meeting totally new or relatively new situation, even when we can see that, of course the rise of new powers is something what we know from the history in general. So first, my question would be if we would be able to grasp a bit, what does the rise of China mean for the international relations in general and for the security issues? And then, of course, if you could very shortly maybe characterize China as a great power contemporary China has a great power.
Sorin Ioniță: Well, it’s a complicated question, and it depends very much at what time period we look. Indeed, if we place ourselves in the long history, decades, we look back decades, it has been a China rise, which is obvious on economic indicators, on the indicators related to military power in the in East Asia. So, yes, China represents today, especially in the global economy, much more than it used to represent 30 years ago or 40 years ago. That’s obvious.
There has been a process also in parallel that extracted hundreds of millions of people from poverty, from the poverty which used to characterise China half a century ago. That’s also a reality. They now have a middle class which was not there in the time of Mao, but even later. In this sense, it is an alternative model of development for many people, for many analysts, and they call it the authoritarian development. And we have to admit it has a certain force of attraction for some people.
But if you get closer and we shorten the time span of our analysis, if we look at the last five years, for example, it’s a decline of China, at least in the relationship with Europe, with Eastern Europe, obviously. So I think the peak of China power in our region, which is a Black Sea, right, or former communist countries of Eastern Europe, was sometime around 2011, 2012, maybe 2014, in the first years of President Xi Jinping, the current president of China, then there was a big enthusiasm at that point. Many were placing hopes in Chinese investments in Eastern Europe. And definitely we need investment in our countries: Romania, Bulgaria, Central Europe – Hungary, Czech Republic, Slovakia and even the countries which are not in the EU: Western Balkans, Moldova, Ukraine.
If we learned some something from the last ten years is that the great hopes did not materialize, at least here. There is substantial economic relationship between China and the big boys of Europe, the big Western countries. And definitely China has an interest to have relations of all sorts with the European Union as such. But again, they look at the big countries, the big economies, the big markets, the countries with advanced technologies where they could buy something interesting for them in terms of technology or where they can spy something interesting for them, which is not the case, the Black Sea. We don’t have such economic players. But even if the relations with the EU are taken into consideration, we see a backlash, actually, and this is pretty obvious, most of the memoranda or the treaties were put in suspension and the last one, which was approved in the last days of Chancellor Merkel in as as EU presidency, as a rotating presidency. I guess it was December 2020, when the last important economic treaty with China was signed. But then it was immediately freezed because right now the discussion about China is dominated by the human rights issues, by the issue of, you know, suppressing democracy, actually destroying Hong Kong. This is what they did.
About the war issue. The issue of Uigurs and suppressing an ethnic minority. More recently, there are worries about Taiwan and the increase of aggression of China towards Taiwan. So far it is only rhetoric and military posturing. But God knows what’s going to happen. So this is how I would put how I would depict actually the the landscape in the long run. Yes, China was on the rise and it cannot be denied. But in the last five years, I guess it is a backlash against it, at least in Europe – we can discuss about other continents.
The situation is variable and complicated, but I guess they are past their peak of influence.
Even in Africa, even in southern America, because people learn some lessons about economic dependency on these Chinese investments when they appear. But in Eastern Europe they never appear. And this is this is, again, something that needs to be explored because it’s still on the agenda of discussion, you know, and we need to to understand a little bit better these concepts, Belt and Roads and these silk roads coming and going, which have a very variable geometry. Nobody knows where they are. There is no fixed list of projects. There are no budget. You know, they are, you know, something very fuzzy, very ideological and very, very much changing from one year to the next, depending on the speeches of President Xi Jinping.
I think regarding you said about the Chinese investment and the disappointment among the investment, I can confirm this from the Czech perspective, because in the Czech Republic there was a lot of expectations related to this and the expectations were never, never fulfilled. Chinese were more interested in acquisitions, than in investment, and it didn’t move forward. I think how it was expected to from the Czech side at least.
In the Czech Republic and in some countries there were domestic political actors who pushed very much a relationship, and the Czech Republic was Zeman, of course, but he’s a bit out of picture now, and you still have the guys in Hungary and in Serbia. But, you know, so this is a pattern. It’s not Czech Republic is not an exception. Bulgaria is not an exception. Romania is not an exception. It’s a pattern everywhere that there were very loud promises, high expectations, and they never materialized.
There are two economic dimensions here. One is these strategic investment projects, strategic meaning big projects in sensitive sectors like ITC, energy, transportations, roads, harbors. They didn’t materialize with probably one or two exceptions.
And we can discuss about ITC. They were interested, but we blocked them in a way because it’s very sensitive and that is a normal commercial relations. So not strategic projects, but normal trade relations. And in this respect, I mean, things did develop. Our countries do trade with China and we export and we import. But the pattern is that most of us, we have a trade deficit with China.
We opened our markets for goods made in China and that’s absolutely okay. The problem is the Chinese market, they didn’t reciprocate.
And the Chinese market is pretty close to our projects, whether they are agro-food projects like in Romania, Bulgaria, Ukraine, or they are more technological projects like in Central Europe.
The promises to reciprocate never materialized. And that’s a second source of frustration. So no investments and no opening of their market, which is a big and interesting market, but where you need the, you know, political connections and probably informal connections in order to penetrate. We don’t have illusions about how you could be as an economic actor, as a business person from Czech Republic, from Romania or from Bulgaria, if you just go and try to, you know, to export in China, you need to talk to people in the party there.
And this is what the big European multinationals do, although they don’t tell us. But it’s pretty obvious that at least they need to tolerate party organizations in their local branches, because that’s a law in China. It’s like in the old times in our countries: wherever you have a big enterprise, there’s a sort of party organization inside that has some say. And they have increasingly a word to say in how these companies are managed in China.
This is actually the landscape. No strategic projects. On trade relations, people were disappointed in Eastern Europe. And this is why you see this format, 17 or 16 plus one, 17 plus one, then 16 now 14 plus one, pretty much a thing of the past or even sentiment of dissolution in it. Everybody wants to leave actually. And the Baltic states did leave. They left the format and there are discussions in other countries. Does it make any sense to continue because it’s just empty rhetoric?
This brings me to the next question. If you can at least generally say we speak about unfulfilled promises and or expectations, what is or what was at least the Chinese strategy towards Central and Eastern Europe in at the time of peak? What what was their either how they are perceiving us? Are they perceiving us as independent actors or they are perceiving us as something secondary to NATO’s membership to the EU?
You know, this is a very good question and difficult to answer unless you are a very real China expert who knows the insides of the regime in Beijing, and you are able to decipher, you know, the very cryptic language. So even if you speak Mandarin, which I don’t, it is not easy to understand the statements coming from the leaders of the regime. Like in the old communist times, you should know context. and you should know how a very, very discreet turn of phrase means a change in direction.
So in this sense, we can speak of strategies or maybe not of Beijing.
There is a struggle there for power between different groups, which is not very obvious from our side. And now, of course, the group of President Xi Jinping is fully in control.
And he will probably be reinstated this year in October at the next Congress. So there will be a new mandate, which is very unusual according to the the recent political tradition in China. So they are in control and they change you know, they shift this concept as as the situation requires.
So what is a belt and road, which is a big strategy? What are these trade silk roads? Well, they are what the party decided they are in that particular year, because, as I said, nobody you cannot put your hand on it. There is no published list of projects but a general sense was that they want to invest in big transportation hubs, for example, be their airports or deepwater ports, because these are important. But, you know, they push in all places. And if the domestic political actors, you know, provide a favorable framework, they do it and, you know, they move elsewhere. So this is how they recalibrate these projects year after year.
Again, Silk Roads. It can be something strategic in the sense that you invest in some railway or again, sea harbors or it can be just normal trade relations. And then you come and put a label on it like again, like, like the old party propaganda. This is a silk road, you know, or how they did during the pandemics when they created, you know, the Medical Silk Road, when they were shipping by plane, medical aid, materials, masks and even vaccines in the countries that accepted them, including in Europe. And they call these, you know, airbridge with with sanitary materials for COVID-19, the medical Silk Road.
So it’s a permanent redefinition. It’s a very ideological language, which I’m not really sure all Europeans understand it. We from the East, we have this communist experience. We know how ideological language of a Communist Party works, and we know how to read between the lines. I think people in Europe still have this illusion that there is a strategy out there. They believe it’s budgeted and it’s very clear and there are stages of investments because we are used to it from the European funds. This is how it works in our countries. Well, this is not the case here, and this is why there’s a whole list of projects and you still find it quoted in analysis in reports online dating ten years or eight years back.
In Eastern Europe, everything referring to big investments in energy production whether the nuclear plant like in Romania or gas plants or hydropower orfast trains connections in the Balkans or buying ports… Nothing materialized actually, out of this except the small bit of highway in Montenegro, which was built with a Chinese loan by a Chinese company. Probably it’s functional the bit, which is about 40 kilometers, but the country is high in debt because of it. And they need to be bailed out now by the European Union because it’s terribly expensive.
So and this was one of the reasons why the big investment strategic investments failed because they didn’t have a good economic case. I know better the projects which were discussed in Romania and even their investments in the nuclear plant Cernavoda, they didn’t make economic sense back then. What they wanted actually was state aid by the backdoor.
So in the type of contract they wanted, it was a state guarantee for all the money and the investments and that happened to be illegal by the European rules. So you cannot go on with such projects. And this is not just an exception. This this seems to be the case in many places.
And there’s the other big strategic project which everybody is quoting, because actually it is happening. At least they work on it, which is a railway connection between. Belgrade and Budapest. And it’s already behind schedule and above budget. But because for political reasons, the two leaders in Hungary and in Serbia, they push it. They want it because they want to have this kind of relationship with China. It is happening. We’ll see when it’s completed, how much it is used, if they can recover the money invested. We’ll see.
I expect the Chinese will not lose money on this because somehow the national budgets of these countries will cover whatever is necessary. It will be a loss in the sense that you cannot recover the money. There won’t be enough traffic for it to justify the huge investment. Yeah. So that’s, this is how it was. And in a way, it is a pity that we don’t have a more solid relationship with China in terms of of normal trade, because it would be interesting there are some complementarities, especially if they would take more of our agro products. But on the other hand, you know, it’s good not to be very dependent on them because look where the world is going. And you don’t want to be very dependent with your economic relationships on an authoritarian regime who can use these things at some point politically, as Russia is doing today.
This is actually what I wanted to ask now, because you made quite a lot speaking about the economics of the relations with China, between our region and China. Very often we read in media about the Chinese influence, and in general, many people are meaning by it more not economic power, but more ideological power. So there is this fear of the authoritarian China. And definitely China is authoritarian. It doesn’t fit in the European liberal tradition and probably will never even fit. It’s, I think, a kind of naive dream if you look at their 2000 years old history. So I would like to ask about this ideological, ideological influence if we should be really afraid of it. Because I also hear from other people who are more, let’s say, optimistic about the rise of China, about relations with China, they say… And I also heard, by the way, from Chinese persons that we don’t want to bring our model outside of China. We will learn the mistakes. We don’t want to do any type of colonization, ideological colonization, these things we really want to do the business as usual. We offer some type of development or balancing investor and so on. So how it is with this ideological influence, should we be afraid of it or is it bubble, which is like much more attached to the economic competition, let’s say?
Well, I guess this is why we’re discussing a lot about business and economy, because actually this officially in rhetoric, this is the main vector of projection of China. And indeed officially, or at least until very recently, this was their official position. There’s nothing ideological. We just mean business. We want to have, you know, mutual benefits and win-win investments. Everybody benefits and China does. China is not the Soviet Union, is not a Trotskyist regime who wants a global revolution or to project a certain ideology. This was very much true or partly true until very recently. Now I’m not so sure because it depends what is what they decide to call. That is their sphere of influence or their empire. And as we can clearly see, Taiwan, which is a de facto independent, developed and democratic country, is not recognized as such.
So we can ask ourselves, well, where do they stop in the future? What if they decide to redefine what is their, you know, China world in the same way in which Putin speaks about the mere right? Because Russia is not just Russia. It’s a very fuzzy concept involving, you know, even communities abroad who speak Russian or who identify in a way emotionally with Russian culture, Russian politics.
So what if China does the same? They have a big diaspora. I’m not talking necessarily about our Black Sea countries or Central Europe. They have a diaspora here, but it’s not significant political. But there are countries where they have a big diaspora. What if they decide one day that Singapore actually is Chinese?
They would say: we cannot recognize the independence of Singapore because, look, all these guys are Chinese. And this was, I don’t know, sometimes in the medieval time, some Chinese general was there. So tomorrow we decide that this is not we don’t admit that this is a separate state from us.
So in this sense, we should be worried for the future because because in a way, this is a trend for the two big powers, authoritarian powers, Russia and China, to define and redefine where they sphere of influence stops. And again, there is a dimension which was neglected in our relationship with Beijing.
Officially, they have embassies here in our capitals. And of course, they recognize we have mutual relations, mutual recognition. They recognize we are independent countries, but in fact, they don’t actually treat us as such. And this is why one of the reasons why there is not much interest from their part to discuss with us or to to do things here in the Black Sea countries or even in Central Europe, very interest is to discuss with the big powers, be that Brussels. So when they have something serious to discuss, they want to influence Brussels or Berlin or London. Right.
While the former communist countries, at least those were part of the Soviet Union and now are independent countries like. Baltic States or Ukraine or Moldova, they don’t treat it on the same par with the others. So in a way, the Chinese embassy in Moscow plays a coordinating role for all this space. And the Chinese embassy in Kiev is calling Moscow. They’re their colleagues who are superior in rank to ask for instructions, or at least on important issues. So this sense of colonialism in a way that only the big and important countries count. And of course, we play this language of equality between all nations. But this is just a facade. And the reality is different.
This is very much a fundamental principle at the core of the regime today in Beijing. And this is how they treat the world. This is how they see the world. Big spheres of influence.
And if you have something serious to discuss, you discuss with the boss, not with the small guys. Of course, you you carry on with the embassy. You have decent relations. At least when they write something in English or in other languages, when they speak in Chinese is a totally different story. So they don’t treat us very leniently, you know. And of course we are not native.
They don’t speak very much about NATO. We my, my organization, we had an online monitoring, including in Chinese, in Chinese language and in English. And we compare the results. And I can tell you what they say about us. I mean, of all the countries and the language is much rougher in Chinese. So when they target their own population, their own diasporas, when they speak about us to their own people, is much more derogatory. We are just the slaves of the big hegemon. It’s not so much NATO is not very interesting for them in East Asia, but the hegemon, which is the United States, of course, and we have just bones and the slaves and we don’t have agency, we don’t have our own mind or our own plans. We just do what they tell us from Washington. So that’s the big picture. And now with the war on Ukraine, that’s a little bit different in Ukraine because they had a true interest before the war and before the pandemics to really invest something a little bit more than they did in our countries. In Ukraine, they did invest a lot in agricultural leases.
For example, they leased land and now this land is trapped in the eastern part in the war zone. So it was not a very fortunate investment for the Chinese companies. But we see on this monitoring in Chinese language that they don’t speak the same rude language against Zelensky or Kiev explicitly, probably because they want to reconnect after the war, but in the same time, they support officially the Russian propaganda. So, you know, it’s a very it’s a very schizophrenic language. And this is why it’s not very explicit. It’s not very analytic. They speak they speak in clichés and in abstractions to their own people and repeat, you know, it’s slogans. And we know what slogans mean because we remember how it was in these countries when the party was putting out slogans.
So the slogan about Ukraine is that the West is pushing them, is fighting Russia with the blood of Ukrainians, which is something which is a narrative borrowed from Kremlin, of course. But in the same time, they face this contradiction because Beijing is supporting Russia. So the separatism in Donbas, but in the same time they reject the separatism of Taiwan. So in a place this is good when people want self-determination, but in another place is not so good. So they try to pave over this, this schizophrenia in thinking by being very abstract with this international principle. So they don’t speak in examples to their own citizens. They never mention this this this comparison don’t pass in Taiwan, you know, because people would realize that there’s an incompatibility in how you frame your strategy.
I think China is probably not the first great power which is having this kind of double standards and double the dialectic kind of language in general. But this was what you described about Chinese attitude towards the smaller nations, this kind of lack of respect to our own subjectivity. I think this is very similar in in the case of Russia over the last 30 years. And I think this is one of the reasons why we are in the situation in which we are. I don’t mean that we have to blame on Russia, but if we take the relations between our region and Russia as a part of the problem, I think this is very same and most probably these space civilizations as Russia and China are defining themselves, they have this hierarchy within their own thinking base that they are on the top and then the top dog and then we then they speak with this same-minded entities, and others are not important.
It is true. It is like Russia of Putin. A civilizational state, as Timothy Snyder called it. And this is what it is. They see themselves as an entity which is bigger than a nation state. It’s a fusion between a Westphalian state, but also civilization. So you never know where it ends.
There are differences, however, between Russia and China today. In Eastern Europe, Russia is much smarter and we know each other much better. The Russians know us. We know Russia because we have a history together of centuries in this region. And they know how to calibrate influence and how to adapt their propaganda and even intrusions depending on the social situation in every country. So what they will say in Czech Republic or what they will do there, they will not they will do differently in Romania, differently in Bulgaria, because they know the context.
China is much more awkward, they just create the rhetoric, they put it here and they expect it will work the same and it doesn’t. So they are they don’t know us and they don’t invest resources to know us and we don’t know them either. And the the second big difference is that China has money while Russia doesn’t have money anymore. So and this makes a lot of difference, actually.
But speaking of all this, I wanted to target the issue, which they spoke about, but maybe we could have a look more precisely on that is the war in Ukraine? Because war in Ukraine is a very important, I think, process for our region. It is changing a lot in terms of security, economy and all the things, and I think it also changes the position. I am guessing that it changes the position in China, in the region and maybe even towards the European Union. And again, I read opposite opinions. Some are especially talking about the fact that China is with Russia. It has same rhetoric. Others say that China was really not happy about what happened in Ukraine. And some say even they they really didn’t welcome the steps of Putin because of what you already mentioned. They have also special interest in Ukraine. And for them all, this is very, very bad sign. And some of their experts even said, and I don’t speak Chinese, so I had to use of course, the English resources said even that the Ukraine war is undermining Chinese position in central Eastern Europe. So what is your your ideal idea of the idea of this?
And this is true. And they started to realize that even with late and probably not just in in central Eastern Europe, because indeed, in the first days and still until today, officially, China is playing the Russia card. They still have this you know, they support them rhetorically. They support them in in the multinational institutions. So they never voted against this thing. They are taking part these days in this military exercise. How do they call Vostok or the one in in the sea? Yes, Vostok. Yes, there is there are military exercises. So they take part as well as India and the other traditional allies of Russia. So China is present there. But again, the observers who know what’s going on in Beijing and I think there is a consensus now that the regime is very embarrassed by what happened. And it was obvious that in the first week they were just waiting and they say, okay, Putin promised that in three days will be over and then it’s okay. We pretend nothing happened, then we continue with Russia. But then after six months, they are completely embarrassed by their ally, by the. Incompetent ally and nobody expected to take that long. It backfires against them terribly against China, I mean, in Europe, because they are perceived as an ally of Russia. And it’s not just our small countries and this dissolution of the format with 14 plus one now, but it’s also the relations with the European Union. I mean, the strengthening of of resolution in democratic countries and people getting, you know, like a clarity of mind.
Look what these authoritarian regimes mean. We cannot play like business as usual.
We cannot believe any more that if we invest, economy will bring democracy after it, which we tried to do with Russia. And it didn’t work. So and there’s a lot of pressure in the big countries that matter.
And the first is Germany, of course. I mean, it’s public pressure. It’s important parties that turn around and they don’t want to have anything to do with these authoritarian regimes. And then the business has to comply at some point. So it will be a very big problem for the German multinationals to extricate themselves from from China like they did in Russia. From from Russia. So, yes, they lost a lot. And they know these Chinese. They didn’t want this thing. They are not happy at all. They didn’t. And somewhere in the middle of this interval of six months, you could see signs. They didn’t want to support the Russian currency. They didn’t want to help them with financial relations. So all the signs are there that they are very embarrassed by what is going on because the fear that they lose influence. It was not their plan actually to commit violence.
Now their plan was to infiltrate UN institutions, get Chinese people, officials at the top of institution, change standards. So that was a plan. It was in a way a more peaceful plan to colonise with their own standards and views and try to influence the countries from inside renditions to to come after dissidents here in the West. Now, it’s more difficult to do that because everybody is putting you in the same box with Putin. And definitely Xi Jinping didn’t need that now to in the year when he was expecting to be in full glory. And then the news this year is that China has also serious domestic economic problems in the financial sector, in the real estate. But that’s probably beside the point of this discussion. But, you know, this is a new context. It’s a decline. It’s not a rise, at least in 2022. Then you have to see how it plays in Africa and Latin America, in Asia. So is it good or bad if if China is associated with Russia? We don’t know yet. I don’t have a very clear view if for them it’s good if it magnifies their influence in in Africa, for example, or not to being put on the same par with with Russia, which is an aggressive country. We know that people there have a different list of priorities and we do in Europe, in Africa. I sort of understand why they are even keener than us to get investments, to get economic relationships. But some of them got more realistic as well because they saw the price of it, which is dependency, which is through deficits, through budget deficits, which means environmental degradation, which means very low labour standards and no improvement in the quality of governance. And you people are many people started to be in two minds about what they do.
And I think this war in Ukraine, which is global news, cannot be ignored by people on all continents. And they started to ask themselves questions. I don’t know what the answer is going to be in Europe. The answer is clear on the other continents. More than five years ago now, people started to ask questions about this authoritarian development model, which failed in Russia miserably because they tried to do the same thing more or less. It failed. Obviously in China is not so obvious that it failed in their own terms. But we have to see there is a deceleration of the growth and if it continues and they they enter a period of stagnation, then demographic decline, which is. Sure, I mean, this is certain the demographic decline and the ageing global population. And they will start to have unemployment problems, very serious unemployment problems, especially among the youth, the educated youth. Then we have to to see what instruments they have to deal with these problems, which they never had before. An authoritarian regime is not very good to deal with these problems. Probably the chaotic democracies are a little bit better prepared to do that.
Okay. I also ask myself some questions because you emphasize the divergence between the West and China. But we have a number of cases where there is economic engagement. For example, we know that Apple relies a lot on its China based plants or partners. And also we remember that in the case of debt crisis in Europe just ten years ago or something, the European Union pushed for privatization of some infrastructure or other entities and they turned out to be privatized by China. So here is this question isn’t the picture even more complex? I mean, isn’t the West also, in spite of that rhetoric and fight against China or divergence, isn’t the West also doing everything it can do to win or have profited from dealings with China? And how is that explained?
No, I don’t think first that there is an interest to start the war with China in the West or to do tends to make the relationship with more intense than it is. If we take out the the period of presidency Trump which we engage in some unnecessary gestures, very spectacular but very inefficient vis a vis China. I think there is a lot of potential of engagement and there are big issues that cannot be addressed without China globally. And one is global warming, and the climate policies cannot be done if China is out of the picture because it’s such a big economy and such a big consumer of of fossil resources. Then second, we are speaking now about these new technologies, especially in energy, the new sources of energy, the renewables in Europe and our we see our future, you know, and we decouple now from Russian gas. We want to get rid of Putin and dependency on Russia and to make a step further into the new world of renewables. But 90% of the solar panels in this world are manufactured in China. So in a way, if we shift it tomorrow, we will be in a new dependency. Of course, we cannot shift in one day and not even in one year.
So there is still time to adjust this relationship and invest more in our in our own production. And if Chinese merchandise is good and it makes economic sense, we should buy it. But we should be careful not to create new relationship of dependency in sensitive sectors which can be played politically. And that’s the only thing we should take and take care of. And this is where we will be blind in the past because, you know, ten years ago, I don’t think there are many so many examples of privatization, of critical infrastructure, probably.
You mean Greece, right? Because they need to they need to sell the port, the harbour in Piraeus. Fine. Well, privatization is one thing, and selling to the Chinese is another thing. So you can privatize without selling to the Chinese. I know that in crisis, there are not many buyers who are interested to take your infrastructure. But you should. You should do it at the right time, at the right moment. And if it makes sense, not necessarily when you are when you have a gun at your head. Otherwise, I don’t think Europe is very, very dependent, except in the we are more dependent in the sense that there are many European big companies which invest it on China and they don’t know how to to get themselves out of there and how to get the money back, because it’s not so easy if they want to leave, especially manufacturing companies. And when you say manufacturing, you say Germany, but also financial sector, which means also Italy and France. They invested there. They are dependent on the huge Chinese market and it made them profits for so many years. And they became dependent on this business model. And now it’s of course, it’s difficult and you have to pay a price to to at least to rebalance a little bit your internal operations in the company. But they will do it because they were crisis in the past and the Western industries have rebalanced. I’m not very worried about what Chinese companies bought in Europe. They bought some companies. They have Pirelli, if I’m not mistaken. They have even a Volvo in Sweden. They have Land Rover indirectly.
So they bought the company with a technology, with a brand for the for the value of the brand, first of all. And the companies continue to operate because they are not stupid actually to kill the value of the brand. They continue to operate with the same workers. It’s just they are oh, now there’s nothing wrong with these kind of relationships, but we need to be more careful what makes us dependent, because authoritarian regimes at some point stop behaving in economically or in a business way. I mean, aiming for profit, and they start to behave in a political way, destroying profit for political purposes. This is the only danger that we should have in mind. And this is true for our relationship with Russia after this war. I mean, we should have relations with with Russian entities if they make economic sense and if they behave commercially. So not like Gazprom today, who is burning gas, just not to sell it to Europe at the lower price.
Okay. I have another very concrete question. A few years ago there was a lot of discussion about a new Chinese infrastructure bank, which was inviting a lot of countries in the world to join its capital formation, be part of the bank and respectively receive funding from it. And I remember that a few years ago, if I’m not mistaken, it was the government with Foreign Minister Melețcanu, but maybe I am wrong with the name of the Foreign Minister, Romania, as well as Greece and Turkey, have signed up with this bank for infrastructure development. Curiously, Bulgaria has not done it, and I just have this question: what happened after Romania joined that bank? Were there any significant projects? And what if there were? What are they? They are not. Why didn’t they happen?
I don’t have much detail now at hand about this particular bank, but nothing happened. It was discussed from time to time. It was obvious or a legacy of the years of enthusiasm, so to speak, when China was coming to the region, when they create in the 16 plus one format. And for much of this period, Romania had the social democratic government in power, who was obviously the party most close, and they pushed for China relations, especially on one particular prime minister, the young Mr. Victor Ponta, who is basically out of politics today. But back then he was very much energetic and he was pushing for this. And Romania’s participation in the bank was decided as part of the many projects they were discussing at that point.
And I guess things got a little bit of inertia and they signed it and we took part in the formation, in the capitalization of that bank. But I don’t know, maybe I’m wrong, but I don’t know of anything of consequence after that. Romanian diplomacy is a bit cautious. And of course, the Minister of Foreign Affairs is very solid and the loyal partner of the West and especially of Washington. But they don’t want to rock the boat. They don’t want to these spectacular moves like Lithuania or Estonia and just slam the door. We are out. They don’t do that. I don’t know why. It’s probably an institutional culture in the Ministry of Foreign Affairs, so let it die there, you know, the relationship with China. But otherwise I can tell you then it’s absolutely ruled out and probably Romania has today the toughest laws against Chinese investments. So no Chinese company is allowed to take part in a public tender and not just in ITC like Huawei or 5G, but anything, any sort of infrastructure, even physical infrastructure. So and this was done following the so called the House, call it clean networks, clean procurement memoranda with the United States. So and it was a regional movement in general.
Could you finally comment maybe in short: you mentioned the China wants to have influence in the United Nations, but also that it looks mostly after its interest, if I understand correctly. So does China think or have a project or a strategy or vision about the whole of humanity?
Now, this is the kind of question that I wouldn’t dare I won’t venture to to respond what they have. And it’s confirming in I mean, we read it in the analysis of very good China experts is that they have they are pushy in terms of UN agencies and it depends on the sector.
Of course, if it is about technological, technological standards of what they want to be there, they want to influence in order to favour their own companies and their own thinking and their own production. If they if it is about human rights standards now, it’s very clear why they want to be there and to influence, to stop reports, to blame China for various things, to have the Internet shaped in their own, you know, on their own frameworks. So with more intrusion, with more surveillance, and without much protection of privacy and this in in this sense, they want to influence the standards. And if it is about the law and order, institutions like Interpol, where the boss is a Chinese, I think it’s still a Chinese official or it was very recently.
Of course, they have a big interest to to to have access to this rendition list or people who are put on the black on the red list internationally, because this is how they pursue their dissidents when they are outside China.
China is not the only country. There are other authoritarian countries who play the same game. They put their human rights activists on the terrorist lists. And then every country, if is not careful, is supposed to extradite them to China or to Saudi Arabia or to Turkey or to China is not the only one trying to do that. So in this sense, it depends on the sector. But yes, they want to be there and they want to shape the international institutions to their own advantage.
Okay. Thank you very much for this very interesting talk. And we invite our listeners and viewers to follow further our episodes channel on YouTube and site and social media channels.
Photo: Sorin Ioniță (source: Facebook)