The power of China’s economic narrative as exploited in the Western Balkans

Corrosive capital is not the whole story: Balkan political elites make use of foreign investments to further a narrative of themselves as ‘saviours’ of the nation.

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The problems of ‘corrosive capital’ are, by now, well known. By exploiting governance weaknesses in host countries, foreign investments that are non-transparent in nature risk broadening rule of law gaps, damaging the environment, reinforcing existing patronage networks, and exacerbating inequality. Such dynamics are usually associated with money flows from authoritarian regimes, where the lines between public and private resources are blurred, and whose companies are often not held to scrutiny for corruption cases perpetuated abroad (unlike those hailing, for instance, from the US or the UK).

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China – whose economic presence in the Western Balkans has increased considerably over the past decade – is a country that is often discussed in this very context. There have been accusations of loans from China being designed to  lock Balkan countries in a ‘debt trap’. Non-competitive and opaque deals are often enshrined in state-level agreements, bypassing standard public procurement processes. And crucially, the possibility of private incentives for public officials makes local elites turn a blind eye vis-a-vis the feasibility and the environmental standards of the project. Well-researched examples that bring forward evidence of such corrosive practices include highway construction in North Macedonia and in Montenegro, as well as the power plants in Kostolac (Serbia) and Tuzla (Bosnia and Herzegovina).

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But there is another way in which the economic investment coming from China is used for domestic political ends in the Balkans: by making use of the power provided by its narrative. Economic renaissance is a topic sure to score political points. Some Balkan leaders have understood that, if presented in the right way to the public, and if the problems outlined above are swept under the carpet, investments from China and other ‘friendly’ countries can provide a powerful lever to pull – for establishing their own salvific activity in their country.

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In the policy study for the Prague Security Studies Institute, I analyse how this narrative has been used by the Serbian Progressive Party (SNS) from 2012 to 2020. I argue that the Serbian political elite has underscored the economic crisis facing Serbia at the beginning of the decade, making it a recurrent campaigning point (it is noteworthy to recall that elections were held almost every year, keeping the public in an almost constant electoral campaign: in 2012, 2014, 2016, 2017, 2018, and in 2020). In the language used with the media, a big part of the ‘solution’ found for this economic crisis was initially attributed to the investments coming from a new partner, the United Arab Emirates (UAE). As summed up by Deutsche Welle in 2013, “the Emirates have appeared out of nowhere and have been presented to the Serbian public as the saviour of the Serbian economy”.

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Fast forward seven years, and the grandiose welcome to China’s coronavirus aid in March 2020 leaves little doubt that this salvific role has been, by now, assumed by Beijing. The recurrent addressing of Xi Jinping and other Chinese officials as ‘brothers’ and ‘saviours’ in 2016-2020 is similar to the manner in which then Deputy Prime-Minister (now President) Aleksandar Vučić often addressed his Emirati counterpart, powerful Abu Dhabi Sheikh Mohammad bin Zayed, in 2012-2016. In less systematic fashion, the friendly image of Russia has served this game, too: the hero’s welcome given to Vladimir Putin during his 2014 and 2019 visits to Belgrade  is a testament to that.

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But thinking that such a strategy is used only with non-Western actors would be a mistake. In September 2020, Serbia signed a non-binding agreement with Donald Trump at the White House that foresees, among other points, clauses that seem to be damaging to her economic relations with both Russia and China. How was this reflected in the Serbian press? The pro-regime media explained that ‘Trump had given [Vučić] the keys to the White House’ and that ‘Serbia was going to get billions in investments from the US’, including through the opening of a US development fund in Belgrade. Once again, the ‘salvific’ economic argument of a friend from abroad coming to the rescue was crucial in the way Vučić presented this foreign policy move as a victory at home.

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Ultimately, in the use of this narrative, external actors are all dispensable: the only essential player is the conduit through which this salvific action occurs – i.e. the Serbian government, and the persona of Aleksandar Vučić in particular. The findings of the study provide insights into why Serbian foreign policy has been so erratic in recent years. This ‘sitting on several stools’ policy should not surprise us too much. Narrative-wise, the Serbian leadership has always picked the actor that was most useful in underlining their own salvific action at any given moment – and will, in all likelihood, keep trying to do so going forward