The Bottom Line Upfront
Chinese President Xi Jinping is embarking on a five-day tour of Europe, with a focus on Hungary and Serbia, two countries known for their close ties with China and Russia. The official English-language version of the Chinese government's foreign relations site called this trip Xi's "golden voyage" to the European nations.
These nations have welcomed Chinese investments in various sectors, including infrastructure, manufacturing, energy, and technology, positioning themselves as important partners for China's economic ambitions in Europe.
The Breakdown
- Xi's visit to Hungary and Serbia highlights China's interest in expanding its influence in Eastern Europe and its strategy of using these countries as gateways for its economic initiatives, such as the Belt and Road Initiative. As other European countries adopt more protectionist policies, Hungary and Serbia's willingness to engage with China offers an opportunity for Beijing to establish a foothold in the region.
- Hungary, as the first EU country to participate in China's Belt and Road Initiative, has become an important partner for China within the EU.
- China has made significant investments in Hungary, including the establishment of an electric vehicle (EV) production factory by BYD, one of the world's largest EV manufacturers.
- Hungary is reportedly in talks with China's Great Wall Motor to announce another EV manufacturing investment in the southern city of Pecs.
- Hungary's openness to doing business with countries that have questionable democratic and human rights records has made it an attractive destination for Chinese investments.
- China's investments in Serbia include mining operations, factories, and infrastructure projects, such as the modernization of the railway between Budapest and Belgrade.
- Chinese loans to Central and Eastern European countries, including Hungary and Serbia, have reached billions of dollars, enabling these countries to fund infrastructure projects and boost economic development.
