#China: Xi Jinping’s Czech visit aims to reach out to Europe

| March 30, 2016 | 0 Comments

xi_czechChinese president Xi Jinping arrived in the Czech Republic for a three-day state visit on Monday 28 March, writes Zhao Minghao.

It’s the first visit to the Czech Republic by a Chinese president since the establishment of diplomatic ties between the two countries 67 years ago. Situated in the heart of Europe, the Czech Republic is an important partner for China’s ‘One Belt, One Road’ initiative.

Sino-Czech relations have shown strong development momentum in recent years. In 2015, the bilateral trade volume topped $11 billion, and over the past decade, exports from the Czech Republic to China have increased by 190%. China ranks as the largest trading partner for the Czech Republic outside the EU, and both countries are enhancing cooperation in areas such as nuclear power, finance, aviation, technology and agriculture.

Chinese tourists made more than 300,000 visits to the Czech Republic in 2015, with direct flights helping to boost the number of visits. In the past couple of years, investment from Chinese companies including Bank of China and Huawei Technologies Co has exceeded $700 million, accounting for 14% of China’s total investment in the 16 Central and Eastern European countries (CEECs).

The Czech Republic has been actively supporting and participating in China-CEEC cooperation, also known as the ’16+1′ cooperation, particularly in the areas of regional cooperation and health. In November 2015, during the Summit of China and CEECs held in Suzhou, China, the two countries signed a memorandum of understanding (MOU) on jointly promoting the ‘Belt and Road’ initiative. Czech leaders have expressed their enthusiasm for participating in the initiative on several occasions. According to a report by the Prague Post, Bohuslav Sobotka, prime minister of the Czech Republic, reiterated at the Chinese Investment Forum in Prague in November 2015 that the Czech Republic could become an entry gate to the Central European market for Chinese financial institutions.

Other countries in Central and Eastern Europe are also supportive of the ‘One Belt, One Road’ initiative. Hungary was the first European country to sign an MOU with China on promoting the initiative, and according to China’s official Xinhua News Agency, Polish President Andrzej Duda said that the initiative would bring benefits to both China and CEECs, adding that Poland, as a Eurasian logistics center, would be vital in promoting China-European trade. The ‘Belt and Road’ initiative has provided precious opportunities for these countries in terms of updating their infrastructure, assisting with the policy objective of opening up to the east, and elevating their status in Europe.

Furthermore, China has committed to achieving a tripartite win-win situation for China, CEECs and the EU, and wishes to cooperate with both the ‘Old Europe’ and ‘New Europe’. For instance, CEECs such as Croatia, Slovenia and Bulgaria have proposed strengthening cooperation on port development. To avoid homogeneous competition, China has offered to initiate cooperation with ports in the Adriatic, Baltic and Black seas. Industrial clusters will be built in ports with suitable conditions, and all sides will benefit from the combination of China’s equipment, Europe’s technology and the Central and Eastern Europe market. Beijing has realized that this method is pivotal for maintaining sustainability for the ‘One Belt, One Road’ initiative.

Regarding development finance, China has made efforts to respect Europe’s interests. China became a member of the European Bank for Reconstruction and Development (EBRD) in January 2016, and various European countries, including Poland, have joined the China-led Asian Infrastructure Investment Bank (AIIB). China also hopes to further strengthen cooperation in investment and financing while promoting the ‘Belt and Road’ initiative.

Xi’s state visit to the Czech Republic will further enhance cooperation between the two nations, and cooperation between China and CEECs. On March 28, 2015, the Chinese government unveiled the full text of the action plan on the China-proposed ‘Belt and Road’ initiative, elaborating on its vision. So it’s significant that Xi’s visit to the Czech Republic has come exactly a year later, and constructive results are expected.

The author is a research fellow with the Charhar Institute in Beijing and an adjunct fellow at the Chongyang Institute for Financial Studies at Renmin University of China. 

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Category: A Frontpage, China, EU, Trade, Trade agreements

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