A panorama of China-CEE cooperation under Belt and Road Initiative

, Investors

Intensive cooperation between China and countries in Central and Eastern Europe (CEE) propelled by the Belt and Road Initiative has yielded rich fruits in extensive fields ranging from infrastructure to energy in the 16 CEE countries.

Central and Eastern Europe is an essential component of China’s Belt and Road Initiative as a quarter of the countries along the route are in the region. All the 16 CEE countries are seated on the route charted by the initiative, which was proposed by Chinese President Xi Jinping in 2013 with an aim to build a trade and infrastructure network connecting Asia and Europe and Africa.

The momentum built around the initiative has brought benefits to countries along its route, and CEE countries have emerged as among the most outstanding components of this cooperation mechanism.

Major cooperation projects between China and the CEE countries are moving ahead steadily. Now let’s take a close look at some of the projects.

Owing to its geographic importance, Central and Eastern Europe marks an essential link in China’s Silk Road development initiative, and the connectivity in turn helps improve those countries’ infrastructure and boost their economic growth.

Established in 2012, a “16+1” mechanism of cooperation involving China and 16 CEE countries has given new impetus to building direct links between China and Europe.

The first direct rail freight service linking China and Poland began in 2013. It takes 15 days to travel from Chengdu in Southwest China to Lodz, the third-largest city in Poland. The freight train service boosted trade between China and Poland.

A direct air link between Prague and Beijing officially went into operation on Sept. 23, 2015. The new air link will significantly boost ties between the two countries and lead to more intensive cooperation in the fields of trade, investment, tourism and health care.

Czech Prime Minister Bohuslav Sobotka said he considered this “very good news” for the Czech Republic.
Alongside the increasingly closer trade relations thanks to the 16+1 mechanism, Chinese enterprises have expanded their investment in the CEE countries, which were eager for capital to upgrade their infrastructure.

In Serbia, the Zemun-Borca Bridge, newly named Pupin Bridge, was completed and opened in 2014, as the first bridge built in Europe by a Chinese company.

Besides, the project for the modernization of the Belgrade-Budapest railway was initially agreed on at the 2013 China-CEE countries leaders’ meeting that took place in Bucharest, Romania, while last year’s summit held in Belgrade, Serbia, saw an MoU signed by China, Hungary and Serbia.

The cooperation plan for the railway construction was signed in 2015 in Belgrade at the meeting of the Trilateral Group of China, Hungary and Serbia for Traffic and Infrastructure Cooperation, setting dates for certain phases of the project.

At a China-CEE summit in November 2015 in Suzhou, China, the three countries signed deals to construct and revamp the railway aimed at creating a fast lane for trade between China and Europe.

The 370-km section of the railway between Belgrade and Budapest will significantly improve the transportation of passengers and goods between the two countries, as it will reduce the traveling time from eight hours to less than three.

In Macedonia, two of the main new highways are also being built with a total of nearly 580 million euros (713 million U.S. dollars) in financing provided by the Chinese Exim Bank.

The 50-km Miladinovci-Stip highway will connect Macedonia’s capital of Skopje to the town of Stip, an important economic hub in the east of the country.

Meanwhile, the 57-km Kicevo-Ohrid highway is built in the west of Macedonia, improving the connection to its tourism center Ohrid.

The projects will be built by the Sinohydro Corp. from China, but Macedonian construction companies, employing huge workforce in the capacity of subcontractors, will benefit from the cooperation as well.

China and Romania have carried out productive practical cooperation within the framework of the 16+1 mechanism, and important breakthroughs have been made particularly in the energy sector including nuclear power, coal-fired power and hydropower.

Among the energy projects, Romania’s Rovinari power plant — a new 600 MW coal-burning power plant — ranks the most advanced. On Oct. 31, 2014, China Huadian Engineering Co. and Oltenia Energy Holding of Romania signed an agreement on the construction of the power plant, with an investment of around 1 billion dollars.

The project was believed to bring advantages to the country’s overall economy for approximately 25 years.

On Nov. 10, 2015, China General Nuclear signed an MoU with the Romanian national nuclear company Nuclearelectrica for developing, constructing, and operating Units 3 and 4 of the Cernavoda nuclear power plant.

According to Nuclearelectrica, the construction of the two units will double Romania’s nuclear power production capacity, while the emission of about 12 million tons of carbon dioxide will be reduced each year as a result.

Another example for energy cooperation is Serbia’s Project Kostolac, in which China Machinery and Engineering Corporation has helped revitalize two blocks of Serbia’s Kostolac thermal power plant, which will extend the plants’ lifetime for two more decades as the first phase of the project. The second phase is the construction of a 350 MW new block, the first new energy facility in almost three decades.

source: news.xinhuanet.com

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