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 Chinese Prime Minister Li Keqiang, trailed by a cohort of 300
corporate executives, met the leaders of 16 countries in Bucharest,
Romania, on Tuesday.
Analysts say the Asian economic power is interested in energy and
raw materials to fuel its economy and in cheap labor at a time when
wages are rising at home. Coupled with a strengthening national
currency, China's growing labor costs risk crimping its exports, its
traditional economic strength.
"Our cooperation has political and economic significance. The onus
is upon us to translate the blue print into reality," Li said after
the meeting.
Closer ties would bring "massive investments and will lead to a
growth in trade," Li said, adding China was interested in investing
in infrastructure, renewable energy and agriculture.
The timing of Li's visit is significant, coming just two days before
the EU is due to sign economic and political partnership deals with
several countries in the region.
The 16 European countries at the summit all share a former Soviet
communist past. But today, they are a varied group. Some, like
Romania, Poland and Hungary, are part of the EU. Others, like
Serbia, would like to join the EU but are still influenced by
Russia, the region's long-time dominant power.
With Western Europe struggling with economic growth and Russia
accused of bullying governments in the region, some of the countries
have been looking farther away for commercial deals.
"Everyone is looking for investment and financing commitments from
China," said Timothy Ash, an analyst from Standard Bank in London.
"The Chinese want trade access and are particularly interested in
the agricultural sectors in the region."
For China, establishing stronger relations now could provide it with
a gateway to markets in the EU, the world's largest economic bloc.
"The world has changed and will no longer be as it was before the
crisis," Hungarian Prime Minister Viktor Orban said at the summit.
"China will have a decisive role in this new world."
Li reiterated China's offer of a $10 billion credit line for
countries in Eastern Europe, a pledge first made last year in Poland
and received with some skepticism by analysts, who say the real
impact will be in trade and investment over the longer-term.
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So far, trade volumes between China and the region are modest, but
growing.
Poland, the Czech Republic, Hungary and Romania together imported
goods from China totaling 31 billion euros ($42 billion) in 2012,
while their exports to China last year reached just 4.5 billion
euros ($6 billion). In the first eight months of 2013, Hungary's
exports grew almost 14 percent.
China's relations with the region were generally strong during the
communist era. And apart from the occasional rows over meetings with
the Dalai Lama and crackdowns on Chinese immigrants, Eastern
European countries are less critical of China's human rights record.
Both tend to prioritize economic pragmatism.
At the summit, China announced a string of preliminary business
deals.
It said it intended to invest in nuclear and wind energy in Romania
and resume imports of beef and pork. It will also help refurbish
railway lines between the capitals of Hungary and Serbia, hopefully
cutting travel time between Budapest and Belgrade from around eight
hours to less than three.
Last year, China's Great Wall Motors inaugurated a factory in
Bulgaria, becoming the first Chinese automaker to assemble cars in
the EU, while China's Changhong consumer electronics company
produces around 1 million LCD televisions a year in the Czech
Republic.
[Associated
Press; ALISON MUTLER and PABLO GORONDI]
Gorondi reported from
Budapest, Hungary. Christopher Bodeen in Beijing contributed to this
report.
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