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China's 21st century 'Maritime Silk Road' ambitions

China's 21st century 'Maritime Silk Road' ambitions
Leaders of state and government of 16 Central and Eastern European countries gathered in Belgrade for a summit meeting December 17 - 18 attended by Chinese Premier Li Keqiang.

Aim of the summit was to move forward the expansion of the region’s economic, commercial and investment cooperation with China it was the third such summit.

Catalyst for the Chinese presence in the region is Greece's port of Piraeus, following the end-November decision by the Piraeus Port Authority to allow China's Cosco to expand its presence there through a $300m investment. This clears the way for the implementation of the Chinese plan for the so-called “21st Century Maritime Silk Road,” easing the import of Asian products into Europe.

Furthermore, Athens recently added its signature to the customs agreement of the region’s states, promoted upon Beijing’s initiative in order to open the commercial transport axis of Piraeus-Belgrade-Central Europe.

Cosco Pacific, which holds a 35-year concession to operate Piraeus container terminal II and III has already poured some $400m into the port, making it one of the fastest growing container ports in the world and expects to handle some 4m teu in 2014. Chinese diplomatic sources have been forward in highlighting the role of Greece in facilitating the implementation of Beijing’s plans, and also helping the local economy make Piraeus the main point of entry for Chinese commodities into Europe.

On the final day of the Belgrade summit, China signed a $2bn deal to finance a high-speed bullet train between Budapest and Belgrade. “This will put in place a corridor between China and Europe,” said Premier Li after signing the deal with his Hungarian and Serbian counterparts, Viktor Orban and Aleksandar Vucic.

Li said he was confident the project – cost of which has not been officially confirmed – would be completed within two years.

The signing was the centre piece of the summit, though on the sidelines a number of agreements were initialled by Li and regional leaders. Slovenian Prime Minister, Miroslav Cerar called for China to help develop the north Adriatic port of Koper as a gateway to Europe. China's Li agreed to support the efforts of Latvia's PM, Laimdota Strajuma to raise investments in her country, while Montenegro's PM, Milo Dukanovic and Li discussed trade, shipbuilding, highway construction and energy projects. The Czech Republic's PM, Hohuslav Sobotka and the Chinese addressed nuclear energy and aviation projects.

Trade between China and the region has expanded five-fold since 2003, and could exceed $60bn this year, up $4.9bn year-on-year. But, Chinese investment remains below targets set during the two previous summits - in Warsaw in 2012, when China pledged loans of $13bn, and last year in Bucharest.

The Chinese are not the only ones using Piraeus as a gateway to eastern and central Europe. Weekly, three or four Greek trains, each consisting of 38 wagons, depart Piraeus carrying containers of Sony merchandise destined for Slovakia, where the Japanese electronics giant assembles TV sets to cover the needs of its European market.

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