Halfway Through: Competing Powers in the Balkans


On 8 January 2020, Istanbul hosted the launch of the TurkStream pipeline. It was a landmark occasion. The metropolis straddling the Bosphorus welcomed the Russian President Vladimir Putin, whom many in the West had come to view as a doppelganger of Turkey’s own strongman, Recep Tayyip Erdoğan. Back in December 2014, the power duo had originally proposed the plan for a natural gas pipeline running under the Black Sea up to the Turkish coast and from there to the Balkans and Central Europe. TurkStream has come, in part, as a rebuke to the European Union (EU). Brussels’ regulatory disputes with Gazprom compounded by the Ukraine crisis and the sanctions against Russia had dealt a mortal blow to South Stream, an earlier pipeline project. Now Putin and Erdoğan capitalised on their partnership, reviving it after the failed coup in Turkey in July 2016.

What also drew attention was the attendance of two Balkan leaders at the Istanbul launch: President of Serbia Aleksandar Vučić and Prime Minister of Bulgaria Boyko Borisov. The two countries in Southeast Europe, one a member of the EU and the other engaged in EU accession talks, have been keen on deepening ties with both Russia and Turkey. They tout TurkStream as a vehicle for attracting foreign investment, generating revenue from gas transit and gaining bargaining power in future commercial negotiations. Serbia has few qualms about assigning a 51% stake in the section of TurkStream passing through its territory to Gazprom, potentially leading to a clash with EU competition rules in the future. For his part, Prime Minister Borisov portrays the extension of TurkStream (or BalkanStream, as Sofia prefers to style it) as a free-standing project, rather than a supplement to the pipeline connecting Russia and Turkey.[1] BalkanStream, he reportedly told US President Donald Trump during his visit to the White House in November 2019, could ship gas from a variety of sources.

The case of TurkStream shows that both the Western Balkans and Southeast Europe as a whole are no longer only a periphery of the EU, but also an area where external players project their influence. Since its seizure of Crimea, Russia has stepped up its efforts to undercut the West. Through a variety of means, it seeks to stymie NATO expansion, undermine trust in the EU and co-opt governments and other political actors. In Serbia, Republika Srpska (RS) – one of the two entities composing Bosnia-Herzegovina – but also elsewhere, Vladimir Putin enjoys widespread support thanks to the grudges against the West dating back to the 1990s.[2] Turkey, too, though officially still involved in accession talks with the EU and a member of NATO, pursues a unilateralist foreign policy rooted in its self-image as a regional power as opposed to a second-rate member of the Western club. Erdoğan views himself more as leader of all (Sunni) Muslims across former Ottoman lands and in Europe than as a president of a nation state. Last but not least, soft loans and high-visibility infrastructure projects have raised the profile of resurgent China, even though Beijing avoids involvement in political and security issues. Underscoring this point, Johannes Hahn, EU enlargement commissioner in 2014-9, stated in an interview for the Financial Times that the EU had “overestimated Russia and underestimated China.”[3] In May 2019, Dubrovnik hosted the 17+1 Summit bringing together the Chinese government and prime ministers and presidents from across Central and Eastern Europe, the Western Balkans and, lately, Greece. In previous years, Romania, Serbia and Bulgaria had all hosted the annual meeting.[4]

This chapter explores the root dynamics accounting for the influence wielded by non-Western actors over regional affairs. At the macro level, the Western Balkans as well as the broader region of Southeast Europe is deeply embedded in the EU. Individual countries in the region are either members of the EU or aspire to join it. The EU is by far the main trading partner and source of financial transfers, in the shape of direct subsidies, foreign direct investment and remittances by migrants. NATO and the US, for their part, remain the guarantors of security. The Alliance keeps boots on the ground in Kosovo, welcomed Montenegro as a member in 2017 and is on the cusp of taking in North Macedonia too. Yet Western dominance has not dissuaded the likes of Russia, China and Turkey (which, again, differs from the first two because of its membership of NATO and Customs Union arrangement with the EU) from asserting their interests. The chapter argues that non-Western actors have benefited from several factors: (1) the weakening pull of the EU; (2) the stalling and in some cases reversal of the process of democratisation; and (3) local players’ preference for diversifying their international links. The chapter starts off by examining the conditions enabling external actors’ actions in the Balkans. Then, it turns to the objectives, strategies and tools deployed by Russia, Turkey and China, and goes on to offer some final thoughts about the international politics of Southeast Europe.

Enabling conditions

The freer hand of external powers in the Balkans reflects the weakening of Western influence. Much has been said and written about the existential threats facing the EU and, looking at the global level, the gradual decline of US-led world order. Evidence suggests that the European Union has muddled through challenges such as the Eurozone crisis, the influx of migrants from the south, Russia’s bid to reassert its hegemony over the post-Soviet space and Brexit. At the same time, the cornerstones of European integration such as the vitality of democratic institutions and the rule of law, open borders and multilateral cooperation are at risk. The periphery of the Union, the Western Balkans but also Southeast Europe more broadly, is exposed to repercussions.

The region’s integration into the EU is facing headwinds. Opposition to the start of membership negotiations by North Macedonia and Albania proves the point. In the Macedonian case, France defied all other EU countries with the argument that the Union needs internal consolidation first before expansion. Kosovo in the meantime has not been granted visa liberalisation despite fulfilling all the technical conditions set by Brussels. Even Montenegro, the frontrunner in the enlargement process, is unlikely to join the Union before the late 2020s. The EU’s unwelcoming attitude substantiates the view that Europe is moving towards a differentiated model of integration where the Western Balkans, along with Romania and Bulgaria and other post-communist member states, find themselves in the outer circles of Europe.

Democracy is also coming under strain. In 2018, the international watchdog Freedom House downgraded Serbia, an EU candidate country, to “partly free”.[5] It did the same with its neighbour Hungary, a member state. To be sure, democratic regimes in the Balkans have never fully moved towards consolidation, even in the 2000s when the pull of EU conditionality was arguably at its strongest. But the 2010s have seen a resurgence of phenomena such as high-level corruption, pervasive clientelism and the erosion of the rule of law.[6] Nationalism is back, sadly not just in former Yugoslavia but also in core EU too. However, unlike the time when Slobodan Milošević and Franjo Tudjman held power, wars are not fought on the battlefield. Rather, they take place on the front pages of the tabloids, beholden to the government of the day, on TV talk shows and growingly in social media.[7]

The weakening pull of Brussels has a negative fallout on domestic politics. The embracing of authoritarian-minded elites by European dignitaries does even greater damage. Pro-EU constituencies in countries like Serbia and Montenegro are disheartened by Brussels and the reticence of member states’ officials when it comes to dealing with ills such as state capture. At the same time, the apparent pro-EU consensus at the level of political parties does not translate into unqualified support for reforms to foster accountability and strengthen the rule of law. Put in simpler terms, Balkan politicians talk the EU talk but do not walk the walk. Sure enough, the status quo may not be as dire as that of the 1990s, but it is hardly a confirmation of Europe’s “transformative power”. The real litmus test is not the number of negotiation chapters open or closed, or benchmarks fulfilled, but the strong desire of large groups in the region to emigrate as evidenced by surveys.

In such circumstances, political and business elites are presented with strong incentives to partner with non-Western players. Connections with Russia, Turkey and China offer a range of benefits. These include:

(1)  Access to financial resources with fewer strings attached compared to the inflows from the EU. Large-scale infrastructure projects like highways and gas pipelines generate rental income which is distributed to political clienteles.

(2)  Popularity with constituents. For Aleksandar Vučić and the Serb member of the Bosnian presidency Milorad Dodik, as well as others, links with Putin, a foreign leader with high approval ratings, bring dividends with voters. The same is true of other high-profile international figures such as China’s Xi Jinping and Turkish President Erdoğan. These links and the symbolic capital they carry are showcased by the media – e.g. TV and tabloids – which is often under the direct or indirect control of political elites.

(3)  Leverage against political competitors. External powers provide support and patronage which strengthens one’s hand in domestic contests and international disputes. Thus, for some Bosniak politicians, e.g. Bakir Izetbegović’s SDA, the partnership with Erdoğan provides political advantage. Similarly, successive Serbian leaders from 2008 onwards reached out to the Kremlin as an ally on the Kosovo dispute.

These (potential) payoffs far outweigh the potential costs of engagement with non-Western actors. The EU and the US have been reluctant to censor or impose penalties for links with their competitors. For instance, there were no negative consequences for Serbia and (North) Macedonia in 2014 when they declined to join the Western sanctions against Russia. Despite the alarm in both Brussels and Washington, there has not been any pushback against Chinese inroads into the Balkans. One should bear in mind that the West does not have a unified position. There is a divergence of views with regard to China across the Atlantic, with the US being more hawkish than the Europeans. Similarly, although Western states have adhered to the sanctions, some leaders – notably Donald Trump and Emmanuel Macron in France – have advocated a reset with Russia. Germany’s commitment to the Nord Stream 2 pipeline, despite American objections, is also a case in point. In a nutshell, Balkan decision-makers have considerable room for manoeuvre and rarely find themselves in an either-or situation.

Russia: playing the spoiler  

Russia is the external power that has carved the largest niche in Southeast Europe. Despite assertions that Moscow is making a comeback, the truth is that it was never really gone. Political, economic (especially in the energy sector) and human links survived the collapse of the Soviet Union. Since the 1990s, the Balkans have been part and parcel of Russia’s strategy to establish itself as a first-rate player in European security affairs. As a consequence of the wars in Bosnia and Herzegovina and Kosovo during this early period, the region came to the forefront of debates on critical issues such as transatlantic relations, the EU’s security and defence policy and NATO/EU enlargement. Having a foothold in the Balkans means having a say on these strategic matters, which are of direct consequence to Russia. Moscow is driven by geopolitics, with other concerns such as economic interests and historical ties with the South Slavs or other Orthodox nations playing a secondary role. It sees the Balkans as a vulnerable periphery of Europe where Russia can establish a foothold, recruit supporters, and ultimately maximise its leverage vis-à-vis the West.[8]

There is no doubt that Southeast Europe lies well beyond what Russia considers its privileged sphere of geopolitical interest. Russia withdrew its troops from Bosnia and Herzegovina and Kosovo in 2003, on Putin’s watch. In economic, social and also purely geographical terms, the former Yugoslav republics and Albania gravitate towards the West. Russia is not a large investor in Southeast Europe, although it enjoys a near monopoly on the natural gas market and a large share with regard to crude oil.[9] The region imports hydrocarbons but its exports to the Russian market are limited, even though Serbia has a free trade agreement which it is keen to extend to the entire Eurasian Economic Union (EEU).

Russia’s only option is to act in an obstructionist manner to undermine the EU and NATO, making use of the Balkans’ own vulnerabilities, whether through nationalism-fuelled disputes inherited from the 1990s, pervasive corruption and state capture or citizens’ distrust in public institutions. Rather than drawing the Western Balkans into its own orbit, a costly exercise for a nation whose gross domestic product (GDP) is comparable to that of Spain, Russia is looking for leverage in the region which it could then apply to the EU and the United States. Influence in Serbia, Bosnia and Herzegovina, Montenegro or elsewhere is a bargaining chip in Russia’s strategic competition with Western powers. From Moscow’s perspective, projecting power in the Balkans is tantamount to giving the West a taste of its own medicine. If the Europeans and the Americans are meddling in its backyard – Moldova, Ukraine, Georgia, or any other part of its ‘near abroad’ –, Russia is entitled to do the same in theirs.

The perception that the United States humiliated Moscow during the Kosovo crisis of 1999 is also at play, justifying engagement with the region as a means to right past wrongs. Russia’s so-called return to the Balkans, in no small measure occurring through invitation from local officials, is payback to the West for its own arrogance. Lastly, active involvement in the region underscores Russia’s role in European security, particularly on salient and politicised issues such as NATO’s expansion, the talks between Serbia and Kosovo and the situation in Bosnia and Herzegovina. This grants Moscow the coveted status of top-tier power, whose interests and networks spread far and wide across the Old Continent and beyond. Russia can leverage scarce resources to attain maximum payoff, be they diplomatic or commercial gains, or simply confirmation of Moscow’s status as an indispensable international actor. Not being bound by any particular ideology or normative aspirations, as was the case with its Soviet predecessor, gives present-day Russia an added advantage.

To implement its objectives, Russia uses a variety of instruments,[10] the most visible being diplomatic alliances. Since 2008, Belgrade has enlisted support from Moscow to equalise the balance of power with Pristina, which has traditionally been backed by the US and leading EU/NATO countries. Russian support accounts for Serbia’s refusal to join Western sanctions following the annexation of Crimea as well. Russia has also been nurturing relations with Republika Srpska. For instance, it supported President Milorad Dodik against the West in 2016 when he staged a referendum to designate 9 January as ‘Statehood Day’ for the predominantly Serbian entity. Stopping short of encouraging secession, Moscow has done its utmost to prevent the Peace Implementation Council from censuring the Bosnian Serb leadership.

Another influence mechanism is defence and security cooperation. Since concluding a defence cooperation agreement with Serbia in 2013, Russian and Serbian soldiers have been training together on a regular basis in both Serbia and Russia. Serbia has procured weapons systems, including MiG-29 fighter jets, T-72 tanks and armoured reconnaissance vehicles from Russia and Belarus. Serbia furthermore holds observer status in the Russian-backed Collective Security Treaty Organization. Russia has been helping the Republika Srpska’s semi-covert efforts to upgrade the entity’s police force into a military force in all but name. While the 2,500 automatic rifles purchased by RS came from neighbouring Serbia, there were reports of Russian advisors providing anti-terrorism and crowd-control training to the new units.

Humanitarian assistance is yet another tool. In December 2011, for instance, the Russian government despatched a twenty-five-vehicle convoy carrying power generators, food, blankets and other supplies to Kosovo Serbs who had taken over the border crossings to Serbia and placed roadblocks across the northern region in defiance of the government in Pristina and the EU mission EULEX. The standoff put the spotlight on the Serbian-Russian Humanitarian Center (Srpsko-ruski humanitarni centar, SRHC) located at the airport of Niš – a Serbian city not too far from Kosovo, which was channelling some of the aid. From the outset, officials from the US State Department and analysts have suspected it of being an intelligence outpost under the guise of a disaster preparedness and response operation.

Trade and investment account for a substantial part of Russia’s leverage. On the surface it is easy to discount Russia’s economic presence. While the Russian Federation supplies gas and crude oil to the region, it is not a significant export market or source of foreign direct investments (FDI) or other forms of financial transfers. For instance, Russia accounted for 4.9% of FDI in Serbia in 2014, 4.6% in 2015, and 3.9% in 2016. The EU’s share is between 70 and 80%. Russian capital corresponds to around 10% of the economy, largely thanks to the Serbian oil and gas company NIS. In Montenegro, where Russian individuals and businesses play an outsized role in the real estate and tourism sectors, Russia’s share in terms of corporate revenues fell from a high of 29.4% in 2006 to 5.5% in 2015.[11]

The oil and gas sector matters the most. Russia accounts for the bulk of gas deliveries to Bulgaria, Serbia, Bosnia and Herzegovina and North Macedonia, and is a significant supplier of crude oil to Serbia and Bulgaria. In addition, Russian companies have a solid foothold in oil refining and in wholesale and retail sales. As elsewhere in Eastern Europe, gas sales to Serbia are carried out through opaque intermediate business entities, something that raises suspicions of side payments. Gazprom is Srbijagas’s near exclusive supplier and, together with TurkStream, will acquire a 51% majority stake in a critical piece of Serbia’s infrastructure. In Bosnia’s Republika Srpska, the sale in 2007 of the only local refinery to a Russian bidder, Zarubezhneft, without a tender has also been a matter of controversy. It was overseen personally by Milorad Dodik, who was prime minister at that time. As a result, Russia is now the largest investor in Republika Srpska (€547 million over the period 2005-16). TurkStream opens a new chapter in energy relations between the Western Balkans and Russia. Serbia has declared its readiness to start construction. Gastrans, the company in charge, is 51% owned by Gazprom. Once completed, TurkStream, with an annual capacity of some 13.88 billion cubic meters, will likely perpetuate Russia’s monopoly of the Serbian gas market and strengthen its grip in Bulgaria.[12]

Russia has considerable influence over domestic politics in several Balkan countries. In addition to official government-to-government contacts, Moscow has established ties with a range of parties and civic association with an anti-NATO, Eurosceptic and nationalist bent. In the case of North Macedonia, Moscow instrumentalised political rivalries and fissures between the majority Slav, Macedonian and Albanian communities. In Montenegro, it threw its weight behind anti-government protests in 2015-16 which were harnessed by anti-NATO, Serbian nationalist forces. They culminated in the discovery of a coup d’état plot by the authorities in October 2016 involving rogue security operatives from Serbia and agents of the Russian military intelligence (GRU).[13]

The Russian Orthodox Church (ROC) is one of the channels for projecting soft power. Just like the Russian state has built strong ties with governments, the Church profits from links with independent Churches in Balkan countries with an Orthodox majority such as Serbia, Greece and Bulgaria. The main interlocutor in the Western Balkans is the Serbian Orthodox Church (SOC), which finds itself in a somewhat similar situation as the ROC in the post-Soviet space. Beyond Serbia, the Church controls parishes in Republika Srpska (Bosnia and Herzegovina), Kosovo, Montenegro and Croatia, and has jurisdiction claims over North Macedonia.

Russia’s presence in the information space is central to its influence. Tabloids, online portals and TV channels across Southeast Europe fuel the cult of Putin, praise Russia’s role in world affairs and condemn the West. On the one hand, there are outlets funded and controlled by the Russian state, which deliver its point of view on international affairs and prominent regional issues such as the Kosovo dispute to Balkan audiences. In 2015, the Sputnik agency opened a Serbian language news service that operates through both a website and a radio station. On the other hand, there are local media – often under direct or indirect control of the elites – that spread (pro-)Kremlin narratives. As a report by the German Marshall Fund contends, ‘[r]egime-controlled public and private media seem to be the most active promoters of pro-Russia sentiments in Serbia’.[14] These include pro-government tabloids such as Kurir, Informer, Alo and Sprski Telegraf. 

Turkey: an aspiring regional power

Turkey is in some respects Russia’s mirror image in that it leverages links with Balkan Muslims. It acts in unilateralist fashion rather than through multilateral institutions and alliances such as NATO. Ankara is asserting its interests by providing economic assistance, supporting domestic political players aligned with the governing Justice and Development Party (AKP), funding schools, stepping in as mediator in regional disputes, and so on. Ottoman imperial legacy is now a central part of Turkish policy in the Balkans, similarly to Russia’s strategy of using religious and cultural links with the nations in the region as an asset. The Directorate of Religious Affairs (Diyanet İşleri Başkanlığı, Diyanet) has a network across the Balkans, funding imams, mosques and other pious institutions.[15]

At the same time, there are key differences between Turkey and Russia. Turkey is, strictly speaking, not an outside player in Southeast Europe. Indeed, thanks to its history and geographic location, Turkey is part of the Balkans. It is also connected to its neighbours to the west through numerous diasporas as well as the continued presence of Turks and Muslims across Southeast Europe. Since its establishment in the 1920s, the Republic of Turkey has always participated in and contributed to regional initiatives bringing together the Balkan states.

Is Turkey a rival of the EU and the US in the Balkans? Since the EU membership talks reached an impasse in late 2000s, Turkey – under Erdoğan’s leadership – started seeing itself as a growingly independent regional power with a presence in the Middle East, the Balkans and the Caucasus rather than as an outpost of the West. Especially in the Middle East, the focal point of Turkish foreign policy, Ankara’s interests are often at odds with those of the US and major European countries like France, Germany and Great Britain. Tensions are also visible in the Balkans. At a pre-election gathering held in the Zetra Olympic Centre in Sarajevo, Erdoğan accused “certain European countries” of working against Turkey to divide citizens by exposing ethnic and sectarian divides.[16] The Turkish president went to Bosnia after the German and the Dutch governments banned him from campaigning for elections within their countries. In Sarajevo, he could rally his supporters from all over Western Europe and the Balkans, staking a claim for leadership over Muslims across the continent. 

At the level of practice however, Turkey acts in parallel but not necessarily against the EU and the United States. Its goal is to maintain its presence without replacing the West.

For one thing, Turkey is tightly connected to the European economy, a fact highlighted by the ongoing recession which puts EU investors at risk too. The Customs Union makes the country part of the EU economic space, similarly to the Balkans. Enlargement to new members also means expanded market access for Turkey. Notably, Turkey is amongst the top 5 export markets for Romania, Bulgaria and Greece, all of them members of the European Union.[17]

On the security side, Ankara acts independently of NATO and has deepened its ties with Russia. Yet it remains part of the Alliance and contributes to its policies, including deterrence initiatives aimed at Moscow. Despite its strained relationship with the West, Ankara continues to support NATO enlargement to the Balkans. Rather than pursue an obstructionist strategy, as Russia does, and try to wean countries away from NATO and draw them into its diplomatic orbit, it ratified Montenegro and North Macedonia’s NATO accession treaty without delay. There is also no opposition, rhetorical or substantive, from Ankara vis-à-vis EU expansion, which benefits Turkey. Turkish soldiers serve in the EU peacekeeping mission in Bosnia (EUFOR). When it comes to the Balkans, Turkey has no alternative to offer the countries in the region to woo them away from Euro-Atlantic institutions.

The go-it-alone course has not delivered any substantial results for Turkey. Foreign Minister Ahmet Davutoğlu’s shuttle diplomacy between Serbia and Bosnia and Herzegovina in 2010-11 looked impressive on paper. Yet, beyond some initial concessions such as the Serbian parliament’s condemnation of the war crime in Srebrenica (even though the term “genocide” was avoided), it has failed to settle conflicts. Bosnia and Herzegovina is arguably more fragmented and dysfunctional now than it was a decade ago, when Turkey embarked on its mission as a troubleshooter aspiring to replace the EU and the US. The main achievement of that era turned out to be the opening with Serbia which, though initiated by Abdullah Gül and Davutoğlu, blossomed when Erdoğan and Vučić took charge. Though present in Bosnia, Turkey is not involved in the most significant security issue in the Balkans: Kosovo.  “Normalisation talks” between Belgrade and Pristina are presided over by the EU, with the US and occasionally Russia coming into the picture. All in all, Turkish ambitions have been scaled down. The Serbia-Bosnia-Turkey trilateral summits are now focused on more immediate issues such as the highway connecting Belgrade and Sarajevo.[18]

The AKP has made Islam the centrepiece of Turkish policy. Yet it was never altogether absent from the picture. The involvement of the Directorate of Religious Affairs dates back to the 1990s. Back then, one of its main concerns was counteracting Salafism coming from the Gulf. Nowadays, its imperative is to stamp out the Gülenists, who managed to expand their influence in the 2000s, when they were allied with the AKP. On the one hand, Turkey plays a hegemonic role in Balkan Islam. On the other, religious communities are the arena of struggles emanating from Turkish politics – drawing on the country’s soft power. Fethullah Gülen’s cemaat was once the vanguard of Turkey’s influence in the Balkans. Now it stands as the state’s enemy number 1.

As is the case with Russia, Balkan elites do not necessarily see a trade-off between ties with Western organisations and with Turkey. This is clearly visible in the policy of non-aligned Serbia, which has also been courting Russia, China and the Gulf, while negotiating its membership of the EU. But it is also the case of Bulgaria, which has emerged as a leading advocate of engagement with Turkey within the European Union. The only country in Southeast Europe that has deep-seated concerns and fears about Turkish expansionism is Greece, which has long-standing territorial disputes with its neighbour, exacerbated by the looming conflict over gas deposits off the coast of Cyprus.

China: the new kid on the block

China is also planting its flag in Southeast Europe. The 16+1 (now 17+1) initiative has raised its stock amongst local politicians, businesspeople and pundits. In 2019, the summit attended by Chinese Prime Minister Li Keqian took place in Dubrovnik. In April, Serbian President Vučić travelled to China, where he met his counterpart Xi Jinping. The presidents of Bulgaria and Greece did as well, though they certainly hold much less power than their counterpart in Belgrade. Amidst escalating trade disputes between Beijing and the West, governments continue to court China for investment. The five Western Balkan countries have attracted more than half of the $9.4 billion channelled to the 16+1 grouping, with Serbia taking the lion’s share. China, in turn, is leveraging its growing foothold to advance the Belt and Road Initiative (BRI) and lock in access to the EU. Beijing aims to secure maritime and land corridors into core European markets passing through Southeast and Central Europe. Lastly, the BRI also helps Chinese state-owned corporations invest and recycle excess capital.

China does not have a region-specific policy. Rather, it treats the Balkans as part of a larger Central and East European cluster which now also includes Greece. China seeks to play divide-and-conquer vis-à-vis the EU. One of the chief complaints by Europeans as well as the Americans is that trade ties with Beijing are not on a level playing field, due to various forms of protectionism, theft of intellectual property, subsidies and exchange rate manipulation. Special links with the East Europeans help dilute efforts to forge a common European position in favour of greater reciprocity. The countries concerned do not export much to China, unlike their neighbours to the west (though they are part of the supply chains centred around Germany, which accounts for half of Europe’s exports to the Chinese market). What Eastern Europeans prioritise is FDI and infrastructure development backed by soft loans from China, BRI’s trademark. That is why they are amenable to Beijing’s overtures and have none of the ambivalent attitudes of the core EU countries.

In the Western Balkans specifically, China seems to be popular because it accords a higher status to the countries in the region. Rather than being outsiders kept at arm’s length by the EU, they get to sit at the same table with member states. What is also at play is the symbolic capital of former Yugoslavia. At least some decision-makers in Beijing appear to have fond memories of that communist country yet independent from the Soviet Union and committed to a policy of non-alignment.[19] No doubt, Serbia is currently playing the neutrality card, donning the mantle of Yugoslavia’s successor. By contrast, Albania, which aligned with China during the Sino-Soviet split and through to the late 1970s, has failed to capitalise on old ties.

In contrast to Russia and Turkey, China is exclusively focused on economic ties and avoids becoming ensnared in local disputes. It is true that like Moscow, Beijing opposes Kosovo’s independence. This has allowed it to build strong links with Serbia. However, China sees its role in the region primarily through the lens of trade and investment rather than meddling in Balkan quarrels. This posture has helped its outreach in the region.

What follows below is a brief overview of China’s main ventures in Southeast Europe.

Western Balkans

China has made remarkable inroads into the Western Balkans. Beijing is mostly financing infrastructure projects which are then implemented by Chinese contractors.

Serbia has gone further than its neighbours in developing ties, with Xi Jinping visiting Belgrade in June 2016 s. Loans to the tune of $1.3 bn by China’s Exim Bank are funding the modernisation of the Serbian section of the Belgrade-Budapest railway. Other projects include a motorway in Western Serbia built by the state-owned China Communications Construction Company (CCCC) and the acquisition of the Železara Smederevo steelworks by Chinese steelmaker HBIS. Vucic has been touting the sale of a new tyre factory at Zrenjanin, and the sale of RTB-Bor mines to another Chinese company.[20]

Other countries are going down the same road. In Bosnia, the Federation’s electricity utility Elektroprivreda BiH has commissioned a new block at the Tuzla thermal power plant to a consortium of three Chinese companies. Backed by a $777 million Eximbank loan, the project is the largest industrial undertaking since the war in the 1990s. China Road and Bridges Corporation (CRRB) is building sections of the highway running from the Montenegrin port of Bar to the border with Serbia. The first 41-km section is scheduled for completion in 2020 and involves some 20 bridges and 16 tunnels. Yet there have been concerns about the lack of transparency of the Eximbank-funded project, which accounts for 80% of the country’s GDP. CRBC, which won the contract without an open tender, is exempt from VAT and customs duties. In North Macedonia, two highways contracted in 2013 with Sinohydro Corporation under a 20-year loan by Eximbank, have triggered corruption charges against former Prime Minister Nikola Gruevski and top officials in his cabinet for siphoning off €150 million from the state’s budget. As a result, the 56.7-km Ohrid-Kichevo road has been delayed well past its original May 2017 target date. The government estimates that an additional investment of €70 m is needed for completion. The case illustrates the less appetising aspects of Chinese ventures.[21]

China is also selling its technology to the Balkan countries. In March 2019, Serbian Interior Minister Neboljša Stefanović announced that Huawei would install 1,000 surveillance cameras in Belgrade equipped with facial and license-plate recognition software, as part of the Safe and Smart City project. At least 100 cameras appear to be already in operation. For Chinese ICT companies, Belgrade could become a launching pad for other cities in Central and Eastern Europe, in line with Beijing’s “Digital Silk Road” strategy. Belgrade is eager to host a Huawei Innovation Center for Digital Transformation. In the summer of 2019, Serbia and China launched joint police patrols in cities visited by Chinese tourists.[22]

EU members 

There is a growing Chinese presence in EU member countries in the Balkan region. In January 2018, CRBC won a tender for a bridge on Croatia’s coast. The project, which has unnerved neighbouring Bosnia and Herzegovina as it cuts through its minuscule access to the Adriatic, is funded largely by the EU. Bulgaria too is pursuing Chinese investment. The energy ministry in Sofia maintains that the China National Nuclear Corporation is interested in the Belene nuclear power plant, a project carried out by Russia’s energy corporation Rosatom. Bulgaria used to host a factory assembling Chinese-made cars, which went bankrupt in 2017.[23]

In 2018, Greece became the first developed country to sign up for BRI, and last year it also joined the 16+1 platform. China’s flagship project remains the port of Piraeus which is majority owned by COSCO Shipping. In August, the company submitted a €800 million plan for a new container terminal. Together with the upgrades of road and rail infrastructure across former Yugoslavia, the expanded port could boost Chinese exports to the EU.


In the 2010s, Balkan politics became growingly competitive. Multiple players willing to challenge Western dominance or simply to exploit gaps and opportunities have entered the region. Nowhere is this more conspicuous than in the successor states of former Yugoslavia, with Serbia and Bosnia and Herzegovina standing out. Yet the rest of the region is not immune either, as the inroads made by China suggest. While the EU and NATO are still the principal centre of gravity, their transformative impact on Balkan countries’ foreign policies, but even more importantly on domestic institutions, has proved limited. Local elites have been eager to diversify their international partnerships beyond core Europe and the US and to cash in on opportunities offered by non-Western players. This should come as no surprise, not least because such behaviour is hardly uncommon within the EU too. Yet foreign influence also carries costs in that it exacerbates indigenous problems such as state capture, deficiencies in the rule of law and toxic nationalism. Any strategy by the West to counter its rivals should therefore focus on the underlying conditions making Southeast Europe vulnerable.

[1] Further on TurkStream: Dimitar Bechev, Russia’s Pipedreams are Europe’s Nightmare, Foreign Policy, 12 March 2019. https://foreignpolicy.com/2019/03/12/russia-turkstream-oil-pipeline/

[2] Dimitar Bechev, Rival Power: Russia in Southeast Europe, Yale University Press, 2017.

[3] Brussels says EU has ‘underestimated’ China’s reach in the Balkans. Financial Times, 5 March 2019.

[4] See the chapters on Turkey (by Ahmet Erdi Öztürk and Samim Akgönül) and China (by Anastas Vangeli) in Florian Bieber and Nikolaos Tzifakis (eds.) The Western Balkans and the World. Linkages and Relations with Non-Western Countries, Routledge, 2019.

[5] Freedom House (2018): Freedom in the world. Democracy in crisis. January 2018. Available at https://freedomhouse.org/report/freedom-world/freedom-world-2018 .

[6] Jasmin Mujanović, Hunger and Fury: the Crisis of Democracy in the Balkans. Hurst, 2018.

[7] Florian Bieber, The Rise of Authoritarianism in the Western Balkans. Routledge, 2019.

[8] Paul Stronski and Annie Himes. Russia’s Game in the Balkans. Carnegie Endowment for Interational Peace. 6 February 2019. https://carnegieendowment.org/2019/02/06/russia-s-game-in-balkans-pub-78235

[9] Ognian Shentov, Ruslan Stefanov and Martin Vladimirov. The Russian Economic Grip on Central and Eastern Europe. Routledge, 2018; Bechev, Rival Power, Chapter 7.

[10] For a comprehensive account of Russia’s toolbox in the Balkans: Dimitar Bechev, Russia’s Strategic Interests and Tools of Influence in the Balkans, NATO Strategic Communications Center for Excellence, September 2019. https://www.stratcomcoe.org/russias-strategic-interests-and-tools-influence-western-balkans

[11] Data in Ruslan Stefanov and Martin Vladimirov, The Kremlin Playbook in Southeast Europe: Economic Influence and Sharp Power. Center for the Study of Democracy (Sofia), January 2020. https://csd.bg/publications/publication/the-kremlin-playbook-in-southeast-europe-economic-influence-and-sharp-power/

[12] Ibid.

[13] Bechev, Rival Power, Chapter 2.

[14] Asya Metodieva, Russian Narrative Proxies in the Western Balkans, Policy Paper No. 16, Rethink. CEE Fellowship, The German Marshall Fund of the United States, June 2019, p. 13.

[15] Turkey’s influence in the Balkans is covered in a special section in Südosteuropa Mitteilungen 59 (5-6), 2019. See also Ahmet Erdi Öztürk and Samim Akgönül in Bieber and Tzifakis, The Western Balkans in the World, op. cit. Alida Vračić, Turkey’s Role in the Western Balkans, Stiftung Wissenschaft und Politik, Berlin, December 2016.

[16] BBC (2018): Erdoğan Bosna Hersek'te: Avrupa'nın bize karşı tavrının sebebi oradaki Türklerin dağınıklığıdır, BBC Türkçe. 20.05.2018 , available at: https://www.bbc.com/turkce/haberler-turkiye-44189205

[17] Turkey’s major export markets in Southeast Europe in 2018 were as follows - Romania: $2.5 bn, Bulgaria: $1.7 bn, Greece: $1.4 bn, Slovenia: $1.06 bn, Serbia: $586 million, Albania: $308 million, Bosnia and Herzegovina: BiH: $294 million, Croatia: $272 million, North Macedonia: $253 million, Kosovo: $215 million, Montenegro: $80 million. Turkey’s imports from the region – Romania: $1.557 bn, Bulgaria: Bulgaria: $1.527 bn, Greece: $918 million, Serbia: $233 million, Slovenia: $211 million, Croatia: $150 million, Bosnia and Herzegovina: $120 million, North Macedonia: $69 million, Albania: 13 m, Montenegro: $10 million, Kosovo: $3 million. Data from the Turkish Statistical Institute (www. turkstat.gov.tr).

[18] Dimitar Bechev, Turkey’s Policy in the Balkans – Continuity and Change in the Erdoğan Era, Südosteuropa Mitteilungen 59 (5-6), pp. 34-45.

[19] Anastas Vangeli. China: A New Geoeconomic Approach to the Balkans in Tzifakis and Bieber, The Western Balkans in the World, op. cit.

[20] Oxford Analytica. Chinese BRI in Balkans will raise West’s concerns, OA Daily Brief, 11 September 2019.

[21] Ibid.

[22] Vuk Vuksanović. Light Touch, Tight Grip: China’s Influence and the Corrosion of Serbia’s Democracy, War on the Rocks, 24 September 2019. https://warontherocks.com/2019/09/light-touch-tight-grip-chinas-influence-and-the-corrosion-of-serbian-democracy/

[23] Oxford Analytica, op. cit.

The article gives the views of the author, not the position of the "Europe’s Futures–Ideas for Action" project or the Institute for Human Sciences (IWM).