Is it worth taking money from the Chinese: If you try to break the contract, a cold shower follows

In Bosnia and Herzegovina, the influence of great powers was often refracted, depending on the historical circumstances. It has not yet been fully determined how much these forces sought their own interest in our country, and how much they were there for BiH itself. It is the same today, so after the Russians, we are investigating what the Chinese are doing in our country.

 

NUMEROUS OBJECTIONS

Chinese investments in the countries of the European Union have been in a significant decline in recent years. According to a report by Rhodium and MERICS, in 2022, Chinese direct investment in Europe reached its lowest level in the last ten years, amounting to 7.9 billion euros, which is 83 percent less than the peak in 2016.

According to data from the China Global Investment Tracker research, conducted by the American Enterprise Institute and the Heritage Foundation, about three billion dollars have been invested in Bosnia and Herzegovina. As for investments in BiH, 610 million dollars flowed from China from 2019 to 2021, and research showed that BiH took more than 2.44 billion dollars as loans from China from 2010 to 2022.

Faruk Borić, president of the Bosnian-Chinese Friendship Association, reminds that ten years have passed since the Chinese initiative Belt and Road. What did she bring to BiH?

 

- She brought a visa-free regime, there are many Chinese tourists who come to Bosnia and Herzegovina. In both Bosnia and Herzegovina entity, Chinese companies worked on highways, on energy projects, both classic and green. I remind you that Chinese companies also invest in wind power plants, and before that they also built thermal power plants in Stanari, we also have Block 7 of the Tuzla thermal power plant, which is now in question, notes Borić.

 

Chinese investments and loans in BiH are often accompanied by controversies, suspicions of corruption, delays, indignation, and contracts with China are often shrouded in secrecy, there is a lot of talk about failed projects, as well as the fact that economic investments are closely intertwined with politics.

- There are numerous objections, but this is always part of large infrastructure projects, I mean investments in road construction and energy, which is always under scrutiny. You cannot say that the Belt and Road Initiative is not working. You can say that some projects were not in order, that they were not completed, but that does not mean that the initiative is not valid. There are accusations of corruption, so corruption is not related to the Chinese, it exists everywhere, in Bosnia and Herzegovina

it exists beyond the Chinese, Americans, Germans... let it be checked. The Chinese work with all of Europe and it is something that is simply part of world trade. You cannot cancel the tender that the Chinese company won, gave the best offer, because you don't like it, because you wanted, I don't know, a Norwegian or Italian company to win, says Borić.

Economist Admir Čavalić assumes that Chinese investments in BiH should always be viewed in a broader geopolitical context, understanding the complexity of political relations.

 

- When we talk about the specifics of those investments, they are mostly related to infrastructure projects, large works, roads... Lending, support in terms of investment, right up to the execution of the final works, especially when it comes to construction companies, all of this is mutually supportive and ties. And because of that, exiting such projects, such as the current Block 7 in Tuzla, can be very expensive, risky, complex to abandon, terminate, and so on for the host country. Or on the other hand, when there are problems with repayment of obligations, we saw what happened in the context of roads in Montenegro, says Čavalic.

ACCESS TO THE EU MARKET

Economic expert Igor Gavran says that certain countries encourage their businessmen to invest in some parts of the world, where they see some strategic interest, and adds that there is nothing strange or specific to China in comparison to some other countries.

- Some things that are specific to China are actually BiH's advantage. The Chinese logically want access to the EU market. The key problem BiH has with China is that there is not enough investment. So, we have a lot of involvement of Chinese companies in BiH, we have a lot of things that are being built with loans from Chinese sources, but these are not investments. No matter how these projects were implemented and no matter how these contracts were concluded, we have no real investment in them, and that is the key problem. The problem is not how Chinese companies are currently coming to Bosnia and Herzegovina. markets, but why don't we create the conditions for Chinese companies to invest their money, their capital and create new value in BiH, and not just be contractors or creditors, which realistically anyone can do, Gavran notes.