Belt and Road Initiative

The Chinese government established the Belt and Road Initiative (BRI) in 2013. Through it, China has invested in nearly 70 countries and international organisations, “to enhance regional connectivity and embrace a brighter future”. The lion’s share of the initiative comprises fossil fuel investments, infrastructure, and large scale industries, most of which are considered high-risk. 

The BRI’s investments and lending have raised several concerns. Most investments are shrouded in secrecy, and risk violating procurement and transparency legislation in the countries in which they take place. Extensive lending through the BRI has had a tendency to reduce the manoeuvring room of affected governments.

The BRI also has environmental and climate consequences. A considerable amount of its investments are highly polluting large scale industries, coal-fired power plants and infrastructure projects. Many have been met with global protests, from affected citizens and international decision makers.

In recent years, China has adopted various policy measures in response to such international criticism, including the “Guidance on Promoting a Green Belt and Road” document. This recognises the decision-making challenges faced by Chinese companies and state actors in China’s overseas infrastructure projects, and calls on them to adopt higher environmental and social standards.

Although there has been limited action in the interim, the persistent lack of information disclosure on measures and corresponding implementation, and the economic shock of Covid-19, have stymied these efforts to some extent. 

At the same time, the increasing imperative of the “smart mix” of voluntary and legally-binding measures that govern China’s overseas business activities is generating momentum for concrete domestic policy change. 

Recent reports about Belt and road initiative

Chinese companies in Serbia

Disgraced in international operations

Chinese companies have invested in production, infrastructure and enterprises in Serbia since 2014. So far, very little is known about the backgrounds and track records of these companies, which have similar operations in other countries.

Just Finance did a global scan, and found reports of severe environmental violations, debarments from international banks, and repeated breaches of national regulations, including accusations of land grabbing.

Coal power in Europe

The debacle of Chinese financed Kostolac B3 coal-fired power station in Serbia

China continues to be the top financier of coal-fired power internationally. Its state-owned enterprises and development banks are constructing and financing many of the world’s new coal projects. This is increasing the risk that countries participating in the Belt and Road Initiative will be locked into high-emissions development pathways.

This overview explains the status of China-backed coal projects in Southeast Europe, and the compliance irregularities that surround them.

Particle pollution

How Chinese investments compromise Serbian independence

The Smederevo steel factory, founded in 1913, was bankrupt in 1990s due to the sanctions during the Yugoslav wars. Since 2016 it is operated by HBIS GROUP Serbia and owned the state-owned Chinese iron and steel company Hesteel Group Company Limited – one of the world’s biggest steel producers.

The Smederevo steel mill and a trade port on Danube River cause significant air pollutions and loud disturbing noise. Readings of the air quality near the steel factory showed particle pollution, above the limits in national legislation.

Overview of Chinas coal projects in Europe

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News about Belt and road initiative