Abstract
The subject of the research is Chinese investments in the modernization and reconstruction of railway infrastructure in Serbia, with a focus on the construction of the Belgrade-Budapest high-speed rail line up to 200 km/h, on the sections Belgrade-Stara Pazova and Novi Sad-Subotica-Kelebija. The research aims to analyze the impact of Chinese investment projects on the railway infrastructure in Serbia and examine the effects of projects' implementation at different levels, including the challenges they face. The analysis covers the traffic, technical-technological and financial aspects of the project. The importance of building a high-speed railway through Serbia, but also of the shortest railway connection from Western and Central Europe in the countries of Southern Europe and the Middle and the Far East, is considered, especially in the context of the cooperation within the BRI. The research results are the presentation of the effects railway infrastructure projects have on the development of Serbian economy, as well as the challenges that arise during the implementation process.
TopIntroduction
In the last few years, the share of Chinese loans in infrastructure projects financing in Serbia has increased, and Chinese companies are currently carrying out works on large transport projects. According to the latest data of the Public Debt Administration, Serbia signed eleven contracts with the Export-Import Bank of China (herein Exim Bank) for the financing of infrastructure and energy projects worth about 3.2 billion euros in the period from 2010 to 2021.
The growing economic presence of China in Serbia was primarily a result of the signing of the Agreement on Economic and Technical Cooperation in the Field of Infrastructure in August 2009 between the Governments of Serbia and China, which is considered the essential Agreement laid the foundation for the establishment and encouragement of cooperation between both countries. Furthermore, bilateral cooperation was deepened by the launching multilateral framework “16+1” and the Belt and Road initiative (BRI) in 2012, 2013, respectively.
Besides the growing investment activities, deepening cooperation has also fostered bilateral trade relations. China became the third-largest trade partner of Serbia in 2020, while the total trade volume has more than doubled in the past decade (Beraha & Jovičić, 2021). In terms of exports, there was a more substantial increase – Serbia’s exports increased almost 45 times compared to 2010 (Jovičić et al., 2020).
On the other hand, China has become the world's leading creditor in the last two decades, with loans worth over 700 billion U.S. dollars. China's trade with 17 Central and Eastern European countries (CEEC) reached a remarkable $ 103.15 billion in 2020 (Ministry of Commerce of the People’s Republic of China, 2020).
The Western Balkans, as the gateway to Southeast Europe, has a key role to play in connecting the Silk Road and opening the way for Chinese exports to Europe and beyond.
Key Terms in this Chapter
Investments: Assets or items acquired to generate an income or profit.
Belt and Road Initiative (BRI): Is an international initiative of the People’s Republic of China aimed at improving existing and creating new trade routes, transport, and economic corridors connecting more than 70 countries of Central Asia, Europe and Africa, which will promote the development of trade relations between them and China.
Transport Infrastructure: Are facilities, structures and systems provided for transporting people and goods. The development of transport infrastructure enhances economic growth, while the quality of transport infrastructure is essential when it comes to performance in the transport sector.
ETCS (The European Train Control System): A single European standard for the control of signaling and protection of railway traffic.
Infrastructure Investments: Expenditures on new transport construction projects as well as modernization of the existing transport network.
Western Balkan Countries: Countries of the Western Balkans region (Serbia, Bosnia and Herzegovina, Montenegro, Northern Macedonia and Albania).
European Standards of Interoperability: Technical and operational standards that satisfy the requirements and ensure the interoperability of the railway system of the EU.