China has increased its economic footprint in Central and Eastern Europe (CEE) on the back of large-scale infrastructure and energy projects. Its presence in the region has been undermining the quality of governance and the decarbonization targets of CEE countries, particularly in the Western Balkans. 

These were some of the key insights presented at the online policy conference Chinese Economic Influence in Europe: The Governance and Climate Conundrum organized by the Center for the Study of Democracy (CSD) on 9 September 2021. 

The Director of CSD’s Energy and Climate Program, Martin Valdimirov, presented CSD’s pilot Chinese Economic Power Index that analyzes China’s structural economic ties, the impact on climate policies and on the overall quality of governance in CEE. 

CSD’s Program Director, Ruslan Stefanov, led the discussion by pointing out that China has become increasingly assertive in CEE countries and that its investments in coal and carbon-intensive industries is hampering the region’s long-term economic restructuring. The panel also included Reinhard Bütikofer, MEP from the Group of the Greens / European Free Alliance, Ruben Diaz-Plaja, Senior Policy Advisor at NATO’s Policy Planning Department, and Eric Hontz, Deputy Regional Director of Europe and Eurasia at CIPE.

MEP Bütikofer argued that China has been exploiting the domestic vulnerabilities of European countries to increase its influence, while the EU has failed to provide a viable alternative to the region. All speakers agreed on the need for greater EU and U.S. involvement in the region that will remain the key driver of economic development, particularly in the capital-poor Western Balkans. They also stressed on the importance of strengthening common EU governance rules as to effectively counter third-country investments that undermine the EU’s strategic policy objectives.