The Third Forum of Mediterranean Dialogues, which took place in Rome a few days ago, gave politicians, bankers and scholars a chance to discuss the future of the basin. China is gradually emerging as a new player in the Mediterranean. The presence of Chairman of the Bank of China Chen Siqing at the Rome Forum is characteristic. Chen talked, among other things, about the strategic importance of the basin, which is located at the crossroads of the land and maritime Silk Roads. In 2016, the Mediterranean-China import-export trade volume exceeded $150 billion.
In particular, since 2013 when Chinese President Xi Jinping first talked about the Belt and Road initiative, China has strengthened relations with several Mediterranean countries. By investing in logistics and infrastructure, it has successfully established its presence. The type of cooperation varies according to the different business opportunities offered, but its nature is certainly a win-win one.
Numerous examples can be given. Turkey, for instance, is significant. According to data provided by the Turkish Ministry of Foreign Affairs, the bilateral trade volume rose from $24.16 billion in 2011 to $27.76 billion in 2016. Since the end of 2016, the two countries have also started directly trading in their own currencies. As far as investments are concerned, China’s accumulated direct investment in Turkey increased from $509 million in 2015 to $809 million in January 2017 alone. Energy, infrastructure, transportation, logistics and finance have the lion’s share.
Continuing with Israel, China is economically engaged with its interest in the country’s innovation record. And it is showing great appetite for Israeli ports. China Harbor’s Pan Mediterranean Engineering Company, for example, was chosen to construct the new port of Ashdod in 2014. Another Chinese company will be responsible for the operation of the Haifa Port. In 2015, Shanghai International Port Group won a tender to run Bayport for 25 years beginning in 2021 when the construction of Bayport is expected to be completed by an Israeli consortium.
Turning to Egypt, Xi made a stop in the country in 2016 where he signed 21 deals worth about $15 billion, mainly in sectors like electricity, transportation and infrastructure. Within this context, China is the largest investor in the development of the Suez Canal Corridor. China’s TEDA Corp is constructing a Chinese industrial zone in the area. The first phase is operational and is attracting many factories with impressive investments.
Greece is equally important. The involvement of COSCO Shipping, China’s centrally administered State-run conglomerates in the shipping and port industry, in Piraeus Port, has transformed it into a Mediterranean transshipment hub while the port might function as a starting point for a high-speed train line connecting Greece with Hungary via the Balkans in the future. This investment in Piraeus is practically demonstrating how a Chinese State-owned enterprise is able to practically help problematic European economies by creating job positions and paving the way for additional business deals with the participation of companies from all over the world.
Additionally, China is active in Italy. Only a few months ago, COSCO Shipping acquired a 40 percent stake in the Italian port of Vado near Genoa. Also, China Communications Construction Company Group was awarded a contract to design Venice’s offshore port. Chinese companies also invest in the Italian technological sector, and historic football clubs such as AC Milan have been bought by Chinese businessmen.
For many decades, the Mediterranean was a West-friendly region. The US and the EU have largely defined the past course of the basin and the relationships with the majority of its countries. The future course of the Mediterranean will be also shaped by China. Xi’s vision goes beyond trade and pure economics. By implementing the Belt and Road initiative, he hopes to generate prosperity, contribute to peace, fight terror and offer a model of integration and cooperation between peoples with different religions, namely Christianity, Judaism and Islam.
As is happening in other regions of the world, the Mediterranean can prove the peaceful development of China, outline its new role as a global player and test its will for a long-term win-win economic diplomacy. Other powers – the US and the EU – cannot but look for practical ways of engagement with the Chinese administration in the basin.
Source: Global Times