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China seeks Balkans foothold

Wednesday, December 17, 2014 - 01:58

Chinese Premier Li Keqiang tells a summit of eastern European leaders that China will pledge billions of dollars in funding as it seeks a stronger foothold in the region. Should the EU worry over, or welcome, the approach? David Pollard reports.

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Shoulder to shoulder - a show of solidarity between Chinese premier Li Keqiang and his counterparts from eastern Europe. Then the all important signing ceremony - this time for a new rail link through the Balkans. It'll fit with a Chinese plan to turn the Greek port of Piraeus into a regional hub for European trade. And, naturally, will be built by China. SOUNDBITE (Chinese) CHINESE, PRIME MINISTER, LI KEQIANG, SAYING: "This will put in place a new corridor between China and Europe and we hope to see an increased exchange of goods .... Fast railway will definitely be beneficial for our trade and the development of all countries in the region." The cancellation of the $40 billion South Stream pipeline left a financial black hole for the region. Hopes for jobs and infrastructure investment vanishing on Russia's recent decision. China seems keen to fill it. It sees a lucrative market, ripe for development, with relatively low wages and an educated workforce. And a bridgehead to the wider EU. It's already pledged a $10 billion credit line and new $3 billion investment fund. SOUNDBITE (Chinese) CHINESE PRIME MINISTER, LI KEQIANG, SAYING: "We expect new ways of cooperation through private-public partnership and various leasing arrangements and that will make our cooperation more efficient, and more productive." And while some in the West oppose China's ambitions on political grounds, not so many of them oppose them on financial ones. Darren Sinden of Admiral Markets UK. (SOUNDBITE) (English) DARREN SINDEN, MARKET COMMENTATOR AT ADMIRAL MARKETS UK, SAYING: ''Bring on the foreign direct investment! Yes, of course, there's a political ramification when money comes from China into an economy, but as far as the EU's concerned, I think they should welcome foreign direct investment pretty much from wherever it comes.'' The 370-kilometre rail link could be completed within two years - the journey between Belgrade and Budapest to be cut, it's claimed, from eight to under three hours.