Serbia as China’s dirty-energy dumping ground

, News

One motive of the Chinese Belt and Road project is outsourcing pollution and environmental degradation to poorer, distant countries whose governments will ignore the risks – Belgrade is vital to Beijing’s Belt and Road Initiative. But as China takes over old industrial sites, Serbian citizens are suffering the environmental consequences.

Back in late 2015, Serbian President Aleksandar Vucic, then prime minister, was a guest at the national TV broadcaster, RTS. When asked by the host Olivera Jovicevic why the Chinese are interested in investing in Serbia, Vucic replied in his typically forceful fashion: “It is because they have their interests. It is because they have to shut down part of their forge factories and part of their steel mills. I guess it is because of clean air, of which I do not have enough knowledge, to be honest with you. And why should I be concerned about that?”

Six years later, these words have special weight. Serbia, a major link in China’s Belt and Road Initiative , is importing environmentally damaging economic projects from China while also embracing the Chinese model of politics in which the elite sacrifices environmental safety and public health for the sake of economic growth and to stay in power.

The story began in China back in 1978, when Chinese leader Deng Xiaoping decided to open China up to the global capitalist market. Deng’s economic reforms enabled China 40 years later to become the world’s second-largest economy and pull large swaths of its population out of poverty. However, this economic transformation that prioritized rapid industrialization over environmental security came at a heavy price in terms of environmental degradation and public health.

Today, China is suffering from widespread air, water, and soil pollution. For starters, China is addicted to coal in energy production, still accounting for half of the global consumption of coal. In 2020, China built three times as many coal power plants as the rest of the world combined. By 2018, carbon dioxide emissions per capita had increased sixfold from 1978. In 2019, China emitted more greenhouse gases than the entire developed world combined. The pollution exacerbates the problem of freshwater scarcity. As a result of soil pollution, over 20 percent of farmland soil from grain-producing regions do not meet soil quality standards.

The Chinese Communist Party is stretched between the desire to maintain economic growth as a source of domestic legitimacy and the risk of environmental degradation, with all the economic, health, and political risks it entails. The latter is becoming a hindrance for the regime’s political stability as environmental protests are becoming common. Yanzhong Huang, a senior fellow for global health at the Council on Foreign Relations, called this phenomenon “toxic politics” in his latest book.

To alleviate these challenges, the Chinese leadership is taking steps, including internationally. Indeed, one of the motives behind the Chinese Belt and Road project is outsourcing pollution and environmental degradation to poorer, distant countries with a dire need for infrastructure financing and socioeconomic development, whose governments will ignore the environmental risks. This is already happening in East Africa, where Chinese projects are upgrading the regional coal-related infrastructure but increasing the region’s dependency on coal and environmental hazards that accompany coal consumption.

Serbia has been a suitable partner in that effort. Thanks to its critical geography of being a linchpin between Central Europe and the Balkans, a region at the crossroad between Europe and wider Eurasia, the country received a large amount of Chinese resources and attention, as Beijing needs Serbia and the Balkans to connect itself to European markets.

Between 2010 and 2019, China invested 1.6 billion euros ($1.9 billion) in Serbia, while Chinese infrastructure loans to Serbia are estimated to exceed 7 billion euros. The catch is that Serbia perceived the Chinese as a quick and easy source of cash, as Beijing was willing to take over old, debt-ridden industrial facilities that were losing money but still provided employment and livelihood to Serbian working-class families. While the Chinese profit from getting access to resources—for example, in 2020 the bulk of Serbian exports to China has been copper from  the Chinese-owned mining complex in Bor, Serbia—the main goal of the Chinese government is to sell the surplus of its coal-related technology and relocate coal-related labor forces abroad.

In 2016, after a landmark visit by Chinese President Xi Jinping to Serbia, China’s Hesteel took over a troubled steel mill in the Serbian city of Smederevo, at one point owned by U.S. Steel. In 2018, China’s Zijin Mining took a 63 percent share in the Bor mine, the country’s only copper mining complex, which was burdened by debt. The fact that the Chinese companies did not adhere to the stringent European environmental standards—which are difficult to follow in the underdeveloped Serbian economy—played a role.