Posts Tagged ‘China-Europe’

I am travelling and working on various projects which is impeding my productivity and ability to post. A few pieces to come this next week hopefully though. This one is an op-ed for the EU Observer, somewhere I used to write more frequently for but I like to hope gives me an hearing in Brussels. At its base, the idea of the piece is to try to raise awareness of China’s Silk Road Economic Belt in Brussels where so far it has not quite taken off. A Chinese friend pointed out it was translated into Mandarin, while I also see that the Russian press has picked it up. Not sure what I should read into that. More on this topic undoubtedly to come.

Europe: The other end of China’s Silk Road

I'm preparing for my trip to China and when I bought the currently I was a little surprised to see that Mao is still on the Yuan notes.  Hmm. I took some detail shots of the money as well - I always enjoy seeing the currency of different countries.  This shot was taken with my 100mm Macro f/2.8 IS.  Flash fired remotely with a poverty wizard to add sidelight to enhance the texture of the paper.

China is coming closer to European markets (Photo: dolmansaxlil)

LONDON, 18. MAY, 09:24

All of the attention around Xi Jinping’s recent European trip was focused around his visit to Moscow in time for the May Day military parade.

By focusing so singly on the Moscow stop, however, the importance of the route he took was missed.

Coming soon after the President’s visit to Pakistan in which he laid out the China-Pakistan Economic Corridor (CPEC), this trip affirms one of the key routes of the Silk Road Economic Belt – running through Kazakhstan, Russia and Belarus to ultimately end in Europe.

This final link is the key which Europe needs to wake up to, to understand that this Chinese outward push is one that is both a reality and one that can advance European interests.

The Silk Road Economic Belt route of the ‘One Belt, One Road’ initiative advanced by Xi is going to become the cornerstone foreign policy of the current Chinese administration. Enmeshed in the idea of returning China to its place at the center of global power, the initiative has led to the fanning out of a number of economic and trade corridors from Beijing.

The precursor to all of the ones currently talked about (a latticework of routes stretching out from China’s ports around the world through the Maritime Silk Road, through Pakistan in the CPEC, through Bangladesh-Myanmar and to India in the BCIM) was the route through Central Asia.

Initiated as part of a strategy to develop China’s western regions, the idea was to help reconnect Xinjiang to Central Asia, and ultimately through the region to European markets. For Beijing, Europe is the other end of the Silk Road Economic Belt.

In trying to implement its strategy, China has made a very conscious effort to reach out to Europe, in terms of official statements and an eagerness to try to find ways of working together on making this strategy work.

At this point it has gone beyond rhetoric. As well as pouring massive amounts of money in helping infrastructure across the former Soviet space, they have also looked at undertaking large investment projects in Belarus, Ukraine and other countries on Europe’s south-eastern periphery.

Closer to Europe

An economic force is sweeping along the Silk Road bringing China ever closer to European markets.

To some this will be seen as a threat. Chinese goods getting a quicker route to European markets will only place more pressure on already threatened European industries.

But this is a dynamic that is going to happen anyway and is already underway. Far better to try to focus on the other side of the equation and the potential opportunities.

Not only in terms of high end luxury and technical goods which Europe continues to manufacture which are so keenly desired by the ever-growing middle class Chinese consumer market which can travel back along this route, but also in terms of the development it will bring along the way to countries that Europe has long sought to help along the path of economic development.

This is something that is particularly true in Central Asia.

Europe has long seen Central Asia as a region it has been trying to support. The current Latvian Presidency has made the region a particular priority. As well as the potential economic opportunities (that Central Asians welcome), the region is one that has fraught internal dynamics.

European entities like the EU and OSCE are amongst the only ones that have been able to help bridge some of these divides – providing a set of lessons and experiences that China is simply unable to replicate, but is keen to learn from.

On the economic side of the equation, Chinese firms have been pushing into Central Asia and encountering all sorts of difficulties be it in terms of local governance or security issues.

This is a space that European companies and international institutions like the EBRD have long worked in and have developed a number of strategies for dealing with these very particular regional problems.

There is an opportunity here.

Building missing links

For Europe, China offers the opportunity to magnify effect – Europe’s economic and political force is substantial, but when bolstered by Chinese capacity and means, becomes an even more substantial force.

As well as the $40 billion Silk Road fund, there is the nascent Asian Infrastructure Investment Bank (AIIB) and the slowly developing BRICS Bank, and the sometimes talked of Shanghai Cooperation Organization (SCO) Development Bank.

And China has continued to sign massive bilateral deals in countries along the route, with a particular focus in Central Asia. Admittedly some of this money is hyperbole around official high level visits, but go on the ground across the region and it is impossible to deny the presence of the Chinese funding – tangible as it is in roads, pipelines, railway projects, energy infrastructure and construction across the region.

There is also a larger political point to be made here about China’s relationship with the European Union.

The EU has long sought to find ways to engage with China in a productive manner – Central Asia and the larger Silk Road Economic Belt offers an opportunity to work with China on something that is of direct interest to Europe, but also is clearly a strong strategic priority from the very top of Xi Jinping’s administration.

For Beijing, Europe is the other end of the Silk Road – Europe needs to seize this opportunity to help advance its own interests.

Raffaello Pantucci is director of international security studies at Rusi, a think tank in the UK


Another op-ed in the Chinese press, this time in 中文 for the Oriental Morning Post (东方早报). Looks at the question of Chinese-European cooperation on Central Asia. More detail on this topic coming soon. As usual, Chinese on top, English submission below.












(李鸣燕 译)

Europe in Central Asia

Bishkek, Kyrgyzstan has had a busy few weeks. In the space of a few weeks it has hosted a EU-Central Asia Ministerial meeting and then the Shanghai Cooperation Organization (SCO) Prime Minister’s Summit. Whilst unconnected, the two high level meetings in Kyrgyzstan show Central Asia’s importance, but also the potential for the region to act as a link between China and Europe.

Currently, China is the rising power in Central Asia. Its growing investment, appetite for natural resources and development of regional institutions are reorienting the region towards China. The recent SCO Prime Ministerial Summit in Bishkek highlighted all of this as Premier Wen Jiabao encouraged Central Asian powers to take advantage of the $10 billion loan that China was extending through the SCO to encourage regional infrastructure investment. The hope for China is that the region would develop economically, and more importantly, that it would develop in a way that would help encourage development in Xinjiang.

Europe’s Ministerial meeting was far less ambitious, but highlighted once again the importance that the EU attaches to developing Central Asia. Visiting all of the regional capitals except Ashgabat, Turkmenistan, European foreign minister Catherine Ashton used the opportunity of the Ministerial meeting in Bishkek to emphasize the ‘potential to further develop our energy, trade and economic relations.’ European investment in Central Asia is currently quite limited, trapped between a lack of opportunities and a very challenging investment climate. But clearly the hope and intention is there to try to develop this connection.

Back in 2007, the EU launched a strategy for Central Asia. The paper was ambitious in its scope, and aimed to lay out a new plan for Europe to engage with Central Asia. Phrased as being an expansion of the EU’s ‘European Neighbourhood Policy’ the strategy aimed to increase and target’s the EU’s focus towards Central Asia. Nurtured and launched under a German Presidency of the EU – a member state that has always had a keen historical interest in the region – there was a great hope that it might finally help develop a more practical approach towards a set of states the EU had long overlooked.

Unfortunately, in the five years since the strategy was launched, very little has tangibly been achieved. The EU has spent considerable resources in Central Asia – something that is visible on the ground as you drive around with European Union flags on schools and development projects around the region. It has also helped try to develop border controls across the region through a special Border’s Management Program that has tried to bring modern training and methods to Central Asia’s underdeveloped border guards. But its regional footprint is still very light, with most Central Asian countries not considering the EU one of the region’s major players. Large-scale energy projects like the Nabucco pipeline have yet to get going and are trapped in endless discussion rounds.

In contrast, they increasingly see China as a major player. Over the past year, I have been to all of the Central Asian countries at least once. And in each one, officials, citizens and analysts all told me that China was the rising power in the region. What is interesting is that while they all see the growing consequence of China in the region, they all aspire to be like European states. The model offered by the EU of stable prosperity and a developed state is something that they would all like to achieve eventually and they were eager to emphasize that they would like to do business with Europe. The EU, it seems, is winning the soft power conversation on the ground in Central Asia.

But these parallel achievements by the EU and China in the region highlight the potential for a great alliance between the EU and China through Central Asia. China’s interest in the region is in essence an extension of its strategy to develop Xinjiang. The underlying plan laid out during the China Eurasia Expo is to develop Xinjiang into becoming a ‘gateway for Eurasia’ as Premier Wen Jiabao put it in Urumqi earlier this year. The idea is to develop links through Central Asia and ultimately through to Europe. This would bring prosperity and economic development to a part of the country that has thus far suffered from underinvestment and under-development. It would also finally have the effect of rebuilding the Silk Road that used to bring Europe and Asia together.

This is a plan that has great appeal to all involved. It would not only help China’s goals for regional development, but also help bring prosperity to Central Asia, and finally, help improve direct trade links between China and Europe. All of which would have the net effect of improving prosperity.

Of course, there are a number of obstacles to overcome. While people in Central Asia were often eager to highlight that China was the rising power regionally, they were equally eager to tell me stories of the dangers of Chinese domination. People in Kyrgyzstan and Kazakhstan told stories of Chinese companies paying badly and treating workers unfairly, while Tajiks would repeatedly talk of Chinese men marrying their women. China has a great deal of soft power work to do in the region. But here is something that Chinese firms regionally could learn from their European counterparts. Hiring local staff, offering them good working conditions and establishing ways to help improve the societies in which they are working are methods that the Chinese investors in Central Asia might be able to help improve their image. Making contact with European companies regionally might be a way to try to learn some strategies they have deployed.

All of this is a very long-term game. Europe’s renewed interest in Central Asia needs to be followed up with more concerted action. But an expression of interest from China that Europe is a partner with which China would like to work with in helping regional development in Central Asia is something that could help spur greater European attention on the region. While it is cliché to talk about the New Silk Road, repaving the link between China and Europe through Central Asia could help finally bring the EU-China strategic partnership to fruition.