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“Chinese Digital Silk Road” Dominates the Western Balkans

Chinese Digital Silk Road
China has established a “Chinese Digital Silk Road” in the Balkans. Credit: Kremlin, CC BY 4.0

China has made inroads in the Balkans by establishing a “Chinese Digital Silk Road” by providing digital infrastructure in some countries and telecommunications technology in others.

China’s digital foothold in the Balkans is expanding, generating concern in the West, notes an editorial in the “War on the Rocks” while Radio Free Europe warns “they are invisible, but everywhere.”

What is called the “Chinese Digital Silk Road” is now dominating telecommunications in the Western Balkans, i.e. Serbia, Bosnia and Herzegovina, Montenegro, North Macedonia, Albania and Kosovo.

The Chinese Digital Silk Road is a crucial part of the Belt and Road Initiative. It aims to provide digital infrastructure and telecommunications in several countries.

The Belt and Road initiative is a global infrastructure development strategy adopted by the Chinese government in 2013 to invest in nearly 70 countries and international organizations.

By providing telecommunication networks in the Balkans, and especially 5G digital technology, China establishes its geopolitical influence in Europe, raising concerns in the Western World.

The Digital Silk Road is an alliance of Chinese ICT companies and the Chinese state with the aim to increase the strategic power of China.

At the same time, the Digital Silk Road is an effort for global expansion of Chinese technologies to markets previously dominated by local or Western firms.

China has been building bilateral cross-border optical cable networks, is planning transcontinental submarine optical cable projects, is improving satellite information passageways to expand information exchanges and cooperation.

Now China’s 5G technology aims at dominating in the international telecommunications arena with super-fast mobile networks.

Greece – China cooperation

While China’s shipping firm COSCO is the major shareholder of the Port of Piraeus – the largest in Greece and one of the largest in Europe – the Asian giant does not have a large share of the country’s digital infrastructure.

China has also made a number of different major investments in Greece, including in energy and real estate.

However, this is not the case in the realm of ICT. The lion’s share of Greece’s digital infrastructure belongs to Deutsche Telekom Group, the German giant that bought former state telecommunications company OTE and changed its name to COSMOTE.

COSMOTE launched the first 5G network in Greece in December 2020 without the use of Huawei technology.

At the same time, Greece still has a duty towards Brussels, whereas Beijing is accused of trying to sabotage a unified EU with initiatives such as the “17+1” summit.

The European Commission has announced that it will clamp down more on Chinese investment in Europe, shaking the finger at Greece and other European nations for opening up to China’s plans.

Serbia – China digital cooperation

China has been successful in promoting the Digital Silk Road in the Western Balkans.

Serbia is China’s main partner in the region, as Huawei dominates the country’s landline and broadband internet network.

In 2016, Telekom Srbija announced that the company had signed a $150 million contract with Huawei for the development of optical networks and fast internet.

In the same year, Serbia and China signed a comprehensive strategic partnership agreement.

The strategic and economic ties between Belgrade and Beijing have enabled increased cooperation in the digital and telecommunications spheres.

Huawei has built its regional headquarters in Belgrade and is a longstanding partner of the state-owned telecommunications company, Telekom Srbija.

Along with Huawei, Chinese Hikvision and Dahua technologies have also been established in Serbia, providing video surveillance solutions for both commercial and public safety uses.

According to 2020 data, the amount of contracts signed with Chinese banks for the purpose of the upgrade of Serbian infrastructure has surpassed $7 billion.

Today, there are 1,000 Huawei security surveillance cameras in Serbia’s capital Belgrade, while all digital communications are equipped by the Chinese  company.

Balkan countries not aligned with China

Kosovo and China have not as of yet established any formal diplomatic relations. The Balkan country is clearly aligned with America’s Clean Network initiative.

Similarly, North Macedonia and Albania have limited the Chinese influence in their digital infrastructure, including 5G networks. In 2020, both countries joined the Clean Network Initiative.

Albania, North Macedonia, and Kosovo have openly expressed their will to push China out of existing digital infrastructure and prohibit the participation of Chinese companies in further development.

Montenegro has allowed Chinese firms to participate in the country’s 5G rollout. However, the country has announced that it will seek to diversify its suppliers to mitigate security risks.

Bosnia and Herzegovina, on the other hand, have not limited China’s digital influence. The capital city, Sarajevo, signed a memorandum of understanding with Huawei.

Huawei has a strong presence in the country’s telecommunications system, and has been involved in the education system through cooperation with Mostar University.

European Union and US concerned

The Chinese “digital invasion” in the Balkans is a cause of concern for both the EU and the Unites States.

The Balkan countries are in the immediate neighborhood of the EU, while some of them are potential members waiting in line.

If these Balkan countries indeed become EU partners, China’s digital influence could potentially be transferred to the European Union.

In addition to their EU membership aspirations, Montenegro, Albania, and North Macedonia are also members of NATO, and along with Kosovo have established close relations with Washington in matters of defense and security.

If China creates a digital infrastructure in the region, it could be a potential security challenge not only for Europe but for the United States as well.

Ian Bremmer and Cliff Kupchan, respectively the president and chairman of the Eurasia Group, wrote in a 2020 report:
“China will expand efforts to reshape international technology, trade, and financial architecture to better promote its interests in an increasingly bifurcated world.”

So far Washington has tried to curb China’s attempt to dominate in the digital realm with the Clean Network Initiative.

The Clean Network Initiative is an approach to safeguard U.S. assets including citizens’ privacy and companies’ most sensitive information from “intrusions by malign actors, such as the Chinese Communist Party.”

This was former President Trump’s initiative to protect data flows, which President Joe Biden has embraced.

Several countries in the Western Balkans have signed onto America’s Clean Network Initiative, including Albania, North Macedonia, and Kosovo.

The remaining Western Balkan countries that have not joined the initiative are under pressure to limit China’s 5G digital presence in the region.

The Biden administration is trying to strengthen ties with the EU in order to counter China’s rising influence in Balkan countries and globally.

On its part, the European Commission itself has taken precautionary measures and instructed member countries to adopt policies that will limit the presence of “high-risk suppliers.”

This also serves as a warning to prospective EU members in the Western Balkans. They will have to follow EU rules on digital technology if they want to integrate.

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