/ An Insight: China-CEEC 2019 Summit, 'Building Bridges of Openness, Innovation and Partnership'
THE 8th SUMMIT OF CENTRAL AND EASTERN EUROPEAN COUNTRIES & CHINA, CEEC (11-12 APRIL 2019 – DUBROVNIK, CROATIA)
9th BUSINESS FORUM OF CEEC & CHINA
Croatian-Chinese Pelješac Bridge
On April 11, 2019, Croatian Prime Minister Andrej Plenkovic and Chinese Premier Li Keqiang visited the site of the Pelješac Bridge, marking the completion of the first phase of construction. The bridge is scheduled to open in 2021.
The 16 +1 Summit provides an opportunity for the increased cooperation of China with the CEEC, in sectors such as trade, infrastructure, and tourism. The format of the Cooperation enables China, an economic powerhouse, to invest in countries abroad, increasing its influence whilst boosting CEEC economies. China’s Road and Bridge Corporation is currently building the predominantly EU funded 2.4-kilometre bridge, which will connect the Croatian mainland with the Dubrovnik–Neretva region, negating the need to pass through Bosnia and Herzegovina. Although coming under a certain level of public scrutiny regarding Croatia’s relationship with the EU, Chinese investments are largely recognised as a compliment to EU funds and relations.
Bilateral Agreements
A number of bilateral agreements were signed, including those on the exportation of milk and dairy products to China and infrastructure construction.
9thBusiness Forum of CEEC & China
The annual Business Forum facilitates discussion between China, CEEC and their entrepreneurs on cooperation in the sectors of infrastructure, trade and investment, education, transportation, and tourism amongst many others. EU representatives from various industries and companies gather for discussions on topics of interest and to initiate face-to-face meetings at the event.
The summit saw the establishment of the small and medium enterprises (SME) Coordination Mechanism between the countries of Central and Eastern Europe and China. This mechanism will promote dialogue between the nations’ entrepreneurs and will expand multilateral and bilateral opportunities for trade and investment. The website of the SME Coordination Mechanism was officially launched at the Forum. The summit made clear that the member states advocate multilateralism and free trade, whilst respecting principles of transparency and non-discrimination.
The Dubrovnik Guidelines for Cooperation between China and Central and Eastern European Countries
- The result of each 16 + 1 Summit is a set of guidelines that set specific goals for the upcoming year;
- State representatives confirmed that the 2018 Sofia Guidelines continue to be implemented effectively;
- In the light of increased cooperation and interconnectivity, China will be hosting the 9thChina–CEEC Summit in 2020.
In summary, the strengthening of China-CEEC planning and coordination was agreed upon, given that the platform continues to be recognised as a pragmatic tool for increased communication between the 17 countries. The implementation of the Suzhou Medium Term Agenda will continue, however, there will shortly be a revision of this agenda. Participants recognise the need to review cooperation mechanisms and the results achieved in order to foster a more results-driven approach. The renewal of cooperation platforms will be discussed at the 2020 National Coordinators’ Meetings. The potential involvement of observers and third parties was welcomed in all fields, including the participation of European financial institutions outside of the 17 countries.
During the event, Greece was welcomed as the newest member to join the China-CEEC Forum. The partnership will now be dubbed the 17 + 1 Summit.
The 16 + 1 Cooperation was designed to strengthen business ties and deepen connectivity. Under the EU-China Connectivity Platform, work on exploring integrated transportation corridors will be continued. In light of the Belt and Road Initiative (BRI) and the EU Strategy on connecting Europe and Asia, there will be increased cooperation between the 17 countries and with third countries to promote efficient transport connectivity and a digital economy. Furthermore, dialogue concerning railway projects cooperation will be a big focus given its increasingly important role in social and economic development, and in global environmental protection. In terms of customs matters, this cooperation will take place within the constraints of their respective competencies. However, the possibilities of establishing a China-CEEC Customs Information Centre in Hungary will be explored. There will be a multilateral exploration of the utilisation and construction of logistics hubs which will promote cooperation in the above areas and facilitate trade flow between China and CEEC. There will be increased civil aviation cooperation. The Participants recognise the Three Seas Initiative and support port cooperation, noting the potential of maritime environment and scientific cooperation in the development of the blue economy.
Trade and investment is another key factor within the 16 + 1 framework. The importance of the China International Import Expo is recognised as a pragmatic platform for mutually beneficial economic and trade exchanges. Within this domain, market access barriers must be further addressed to construct a more balanced economic partnership i.e. exports from CEEC into China. Reform of the WTO is necessary whilst continuing to support work within the framework of the EU-China Joint Working Group. An increase in mutual investment between the CEEC and China is welcomed and should be within an open, non-discriminatory and transparent investment environment. As per the launch of the SME Coordination Mechanism, exchanges and cooperation between SME in China and CEEC will be strengthened. The China-CEEC Business Council will be playing a more positive role in encouraging investment and trade cooperation. The union is aware of new trade formats i.e. e-commerce.
Financial cooperation was assessed. Relations among government financial regulatory authorities will be strengthened to create a regulatory environment for cooperation between China and CEEC financial institutions. The diversification of currencies used by market participants was discussed. There will be increased communication with regards to addressing tax challenges.
In regards to education, youth and sports cooperation, various projects, exchanges, and organisations will be launched to enhance education, mutual understanding between the youths of China and CEEC and the development of sports in all countries.
Cooperation in the field of scientific and technological innovation provides opportunities for joint projects and encourages innovation-driven mutual investments. This may give rise to the establishment of the China-CEEC Information and Communication Technology Coordination Mechanism in Croatia. The 5th China-CEEC Conference on Innovation Cooperation will be held in Slovakia in 2020; it will enable exchange and cooperation in the industrialisation of scientific research. Cooperation supports the expansion of mutually beneficial cooperation in the area of energy. China and CEEC wish to further their cooperation in public health and medical service industries through inter-agency exchanges as well as recognise the importance of increased cooperation in the areas of agriculture, forestry, water conservation, and environmental protection.
In terms of people-to-people exchanges, China and CEEC recognise the need to develop social cohesion, emphasising on gender-equality, female empowerment and supporting those in vulnerable situations. Women entrepreneurship will be promoted, along with the possibility of building a China-CEEC network of women entrepreneurship in Romania. There will be further expansion of cultural and tourism cooperation, enhancing international mobility through the development of more direct flights routes between China and CEEC. There will be increased professional cooperation in the cultural and tourism industries to promote tourism. Further development of cultural and artistic projects will be fostered to strengthen relations in these fields, as well as the possibility of the establishment of China-CEEC Creative Hub in Montenegro to serve as an art residency platform for the exchange of artistic potential, goods, and objects. The Cooperation will encourage communication in the fields of radio and television, publishing institutions and intellectual property rights.
Local cooperation is recognised as playing a key role in promoting and enabling the development of the 16 + 1 Cooperation.
Commentary
This year’s summit took place just several weeks after the European Commission published its “EU-China – A strategic outlook” report in response to China’s rapid economic growth and an increase in global political influence. The document, which primarily pertains to evaluating Sino-European relations, labels China as an “economic competitor” and a “systemic rival,” whilst simultaneously describing it as a “cooperation partner”.[1]This set the tone for current bilateral and multilateral relations amongst the 16+1, and indeed between China and the EU.
Over the course of the summit, a number of bilateral agreements were signed with regards to trade, tourism, and infrastructure. This follows just after the 21st EU-China summit, at which both parties committed themselves to build their economic relationship on transparency and non-discriminatory market access. Nevertheless, this does not mean that the EU will accept security threats, such as Huawei’s 5G technology, and in fact, has established a framework for screening of foreign direct investments into the European Union. Whilst all European member states individually and within frameworks, such as the 16+1 format, will be reminded of their responsibility to ensure consistency with EU law, policies, and rules.
For countries like Croatia, who are less economically developed than those in western Europe, the multilateral framework for cooperation provides an opportunity to benefit from foreign investment. This year has seen the first stage of completion of the Chinese contracted Pelješac Bridge in Croatia, the expansion of the 16+1 Cooperation to include Greece, whilst Italy has recently just signed a memorandum of understanding for the BRI. It’s evident that this cross-regional platform has and will continue to allow for practical partnerships and knowledge sharing, however, from the EU perspective, the Chinese initiative has been criticised as an attempt to divide the EU bloc. For example, Greece, still recovering from the austerity measures imposed by the EU, has now been ear-marked for increased Chinese investment. Again, the Commission’s report portrays this skepticism by stating that the “EU nor any of its Member States can effectively achieve their aims with China without full unity.”[2]It seems likely that with increased international competition, along with Russian influence, the EU will be encouraged to further entice the Balkan states towards EU membership. Nevertheless, after years of investment pledges that have failed to materialise, Chinese relations with initiative members such as Poland and Slovakia have cooled. Which leads us to question if many of the pragmatic intentions stated within the Dubrovnik Guidelines will be carried out over the course of the next year, and if so, to what extent.
ENDNOTES
[1]European Commission and HR/VP contribution to the European Council, EU-China – A Strategic Outlook, (Strasbourg: March 2019), <https://ec.europa.eu/commission/sites/beta-political/files/communication-eu-china-a-strategic-outlook.pdf>.
[2]European Commission and HR/VP contribution to the European Council, March 2019.
