Implications of the Silk Road initiative on Europe

by Alexandra Reinhild Berndt

Xi Jinping’s new Silk Road initiative was launched in 2013 and pursues several objectives. China’s intentions are, amongst others, to resolve the problem of industrial overcapacity, to gain access to the European market and to enhance its political influence in the EU through targeted investments in Southeast Europe and the Mediterranean (Casarini, 2016, p. 95). China’s new Silk road initiative also involves significant financial and monetary dimensions (Casarini, 2016, p. 99). But what does this imply for the European Union and for the Sino-European relations?

From the European perspective, there are positive and negative implications. The initiative increases the Sino-European trade, improves logistic connections and enhances the connectivity between Europe and China’s huge domestic market. Extended railway links between China and Europe are expected to lower transportation time and costs and to increase the general trade volume (Baark, 2019, pp. 81-82). Moreover, the Chinese initiative provides opportunities to increase „exports of food and agricultural products, health products and business services such as financial services“ (Baark, 2019, p. 93).

Despite the economic advantages the initiative promises, there are severe concerns about the political implications going along with the Chinese project. With its huge investments in European infrastructure, China increases its soft-power in Europe and thus also increases its chance to introduce alternative norms and regulations (Dave & Kobayashi, 2018, p. 277). Besides the question of compliance with international and European norms, critics also highlight the issue of cybersecurity and recommend to „develop awareness-building measures in order to sensitise potential targets of Chinese intelligence activities“ (Baark, 2019, p. 87).  Furthermore, there are growing concerns that the European competitiveness could be threatened by Chinese dumping goods as China aims at tackling its problem with industrial overcapacities. China intensively invested in European ports, amongst others in the port of Piraeus in Greece. These harbours are consequently almost completely in Chinese ownership. European countries with big container ports as the Netherlands, Belgium or Germany will thus face a tough competition in future (Casarini, 2016, p. 105).

However, the main concern is that China’s investments undermine Europe’s unity as Xi Jinping’s investments in Southeast Europe already caused disagreements among member states. Greece and Hungary, for instance, are unwilling to support Brussel’s criticism of the Human Rights records in China (Baark, 2019, p. 90).

In conclusion, the initiative promises several economic and financial opportunities. However, the political implications are a cause for concern. With its investments, China increases its soft power in Europe, so that alternative norms can be introduced more easily. The European Union is at odds with itself and unable to agree on a common strategy with regard to China. This massively weakens the position of the EU. A common response to China’s initiative is therefore absolutely necessary.

Photo by Ajmal Ali on Unsplash

References

Baark, E. (2019). European perspectives on the Chinese Belt and Road Initiative. China: An International Journal, 17(4), 76-95.

Casarini, N. (2016). When all roads lead to Beijing. Assessing China’s new Silk Road and its implications for Europe. The International Spectator, 51(4), 95-108.

Dave, B., & Kobayashi, Y. (2018). China’s silk road economic belt initiative in Central Asia: economic and security implications. Asia Europe Journal, 16(3), 267-281.