The economic effects of China - EU investment cooperation

[S. G. Mrdaković]

VI, 248 str.

Bibliografija: str. 223-248 Biografija autora: str. [249]

International Economics

China's impressive economic growth of about 9.2% per year оver the past 40 years has opened numerous corridors for investment and business activities of Chinese companies in international markets, of which the EU market was particularly attractive to Chinese investors. Over the last 20 years, and particularly since the introduction of the new Silk Road, Chinese investments in the EU have grown rapidly, and along with them their merchandise trade. When in 2013 China introduced the new Silk Road and the development of land and sea corridors, some of which designed to reach the European Union, it became evident that the presence of Chinese companies in the EU would become more prominent going forward. It is estimated that the value of projects under this initiative will reach 8 trillion USD by the time of its completion. China is now engaged in the largest European ports and companies, in almost all economic sectors. The presence in European ports has created a huge trade potential, making China now the EU’s largest trading partner (in terms of trade in goods). This dissertation examines the China-EU investment relations, with an emphasis on the Silk Road investments and their importance for the EU and for China's interests in Europe. The research aims to determine key advantages and disadvantages of their investment cooperation, and the potential for further development of their trade and investment relations. The research also aims to determine the impact of Chinese investments on the volume, commodity and geographic structure of the EU's foreign trade, as well as the impact of Chinese initiatives within the Silk Road, such as the 16+1 bloc, on the unity and cohesion of the European Union. The relevance of certain countries within the 16+1 bloc for Silk Road corridors in Europe is disparate, which is why some countries have so far received a larger volume of FDI and projects than others. This has caused inequalities in the EU countries’ engagement with China, and the support for China's interests by some, which further caused divisions within the Union. Correlation and autoregression analysis was carried out to measure the interdependence of foreign direct investments and trade between the EU and China, and to extrapolate data on the export and import of EU goods with the largest trading partners. China, USA and Russia trade data was used in the analysis. The research is rounded off with аn analysis of the US rivalry with Russia and China and its impact on EU-China relations. Empirical research indicates an acceleration of EU imports and exports with China compared to other trade partners, which confirms the current dynamics of the EU’s foreign trade, which is moving towards strengthening trade with China and slowing down trade with the USA. This confirms one of the dissertation hypotheses that China’s investment activities in the EU affect the volume and structure of the EU’s foreign trade. The USA's rivalry with China and Russia affects the EU's investment, trade and foreign policy and its relations with China, bringing it inside the triangle of rivalry of the largest military and economic powers. Due to close economic engagement with China and, to a certain extent, dependence on the Chinese market, and on the other hand, alignment with the US in terms of military cooperation and foreign policy, the interests of the EU now gravitate both towards the East and towards the West. The initiation of the conflict in Ukraine and the tightening of relations with Russia further complicated its position. Going forward, the EU must carefully balance its activities and engagements with key partners, to be able to emerge from the existing crises and competition and position itself as an influential geopolitical player, as it has always been.

Međunarodna trgovina, Strane direktne investicije, Put svile, Pojas i put, Ekonomska saradnja Kine i Evropske unije

International trade, Foreign direct investments, Silk Road, the Belt and Road, China - EU economic cooperation

327:339.95(315:4-672EU)(043.3) 339.727.22(315:4-672EU)(043.3)

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