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Opinion
May 10, 2019 www.intellinews.com I Page 23
Within the BRI, CESEE currently accounts for 2-3% of all Chinese investments globally. This increases to 7% for CEE if Russia is included
but this is a unique case. Although Russia enters the top 10 of countries in terms of BRI commitments, this reflects a longer-term bilateral relationship between Moscow and Beijing, which are jointly trying to counter the US geopolitical reach. Elsewhere, countries like Laos or Egypt have received the same amount of BRI-related Chinese construction and investment funding as the whole CESEE region. Such facts and figures speak more for a portfolio admixture than for a large strategic focus.
Bread and butter
As far as misconceptions go, the idea that China is a trading monolith is more accurate in CESEE than the perception it is some sort of calculating loan-shark: China is often among the top 5 import destinations for countries within the region. CE
in particular is geared more towards China than Western Europe, with China accounting for almost 8% of total imports, compared to the Western European average of some 6%. On a country-by- country basis, Czech Republic, Poland, Slovakia, Albania, Montenegro and Serbia import more from China than Germany.
The CESEE dependence on China ends at imports: Germany dominates the export market share of the region, with China lagging at a distant 2.5-
3% of the average total. As with FDI, China only has a significant presence in Russia, where it accounts for 12% and 16% of exports and imports, respectively, surpassing even Germany’s share of Russia’s foreign trade market.
Increasing foreign trade with China is not a strategic end for its own sake for most CESEE states. Rather, it reflects a recognition in regional capitals that exports must be diversified away from Germany, which is dominant. This holds true from a pure country risk or export concentration perspective. In addition, given current trends, Germany will not be an important technology partner in the future. Indeed, the idea that
CESEE states are ‘selling’ themselves to China is questionable. The share of CESEE exports to China are currently well below Western Europe, the US and the OECD, with the latter states conducting an average of 20-25% of their foreign trade with China.
Moldova’s banking sector turning the corner
Moldova has long been a money-laundering black hole. Then in 2014 they had a shock when more than $1bn was stolen from the bank sector – equivalent to 15% of GDP.
Belatedly the government is now responding. Stakes in three of the country's biggest banks, which together account for about 80% of the sector’s assets, have been sold to the European Bank for Reconstruction and Development (EBRD) and private investors and the central bank has been given real teeth to enforce regulations.
bne IntelliNews editor-in-chief Ben Aris talks
to special advisor to the president and head
of strategic planning at Moldova-Agroindbank (MAIB) Corneliu Munteanu and asks if Moldova’s banking sector has turned the corner.
Corneliu Munteanu
special advisor to the president of Moldova, head of strategic planning at MAIB
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