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Dec 05, 2017 - Zoltán Kovács

A ‘dominant financial and technological power’, China comes to Budapest

Last week, Budapest played host to the 7th China-CEEC Summit, gathering Chinese Premier Li Keqiang and the prime ministers, heads of state and senior figures from 11 EU member states and five non-EU countries to advance cooperation between China and Central and Eastern Europe.

As China becomes “a dominant financial and technological power,” according to Prime Minister Orbán in his opening address, with economic growth set to reach between six and seven percent in the coming years, Europe will need to involve the East “technically and financially” to develop further, especially “at a time when it faces historic challenges which it cannot meet unless it has powerful allies," the prime minister said.

“[W]ithin the Central European region,” the prime minister elaborated, following bilateral talks with Premier Li Keqiang on Tuesday, “Hungary’s starting positions are good and our competitive positions in relation to China are particularly strong.” Hungary recognized the significance of China for the CEE region and the transition of the world economy several years ago, thus in 2010 announced its “Eastward Opening” policy and welcomed the Chinese president’s One Belt One Road Initiative.

In the competition for cooperation with China, Hungary has emerged as one of the leaders in Central Europe, the prime minister said. Hungary’s exports to China rank the highest among CEE countries, reaching 600 billion HUF last year (approximately 2.3 billion USD), and it also receives the region’s largest volume of Chinese investments (some 4.2 billion dollars), he added.

The project to renew the Budapest-Belgrade railway line with China’s involvement is a “flagship” enterprise, said Prime Minister Orbán, the first major scheme implemented in cooperation with China, an EU member state, and an EU aspirant. The line would be the fastest way for Chinese goods to enter Central Europe and on to the West.

Chinese Premier Li Keqiang said that the cooperation was mutually beneficial for all participants and the connections between China and the CEE region were getting tighter.

Countries in the CEE region offer good opportunities for Chinese companies, said Minister of Foreign Affairs and Trade Péter Szijjártó, through their “reasonable policies, economic growth above the European average and competitive investment environment.” The minister emphasized the importance of small and medium-sized enterprises in the China-CEE economic cooperation.

Among the many events that took place as part of the sizeable gathering, the Asia Financial Cooperation Association held a financial summit, emphasizing the special focus on financial issues and culminating in the announcement of a new China–Central and Eastern European Countries Inter-Bank Association.

China has indeed established itself as a driving force in the world economy. It remains in the interest of Europe to develop mutually beneficial ties with China, especially economic and trade, and, as it has over the course of history, Hungary is keenly placed to serve as a bridge between East and West.