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Surveying China’s digital silk road in the Western Balkans

  • Sun Online Desk
  • 5th August, 2021 09:38:12 PM
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Surveying China’s digital silk road in the Western Balkans

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If you walk down the streets of Serbia’s capital, Belgrade, your face will almost certainly be recorded by one of the city’s 1,000 Huawei security surveillance cameras. Your Instagram post, tw-eet, phone conversation, or video call will be ena-bled by Huawei’s equipment in the country’s landline and broadband internet network. In 2016, a general director of T-elekom Srbija announced that the company had signed a $150 million contract with Huawei for the development of optical networks and fast internet. With projects like “Safe City” and “Smart City,” as well as the construction of a data center and Huawei’s regional in-novation center, the total value of Serbia’s cooperation with China could be significantly larger.

And it’s not only Serbia. Similar technology provided by Chinese companies is present at the heart of the telecommunications infrastructure of the entire Wes-tern Balkans, which inclu-des Serbia, Bosnia and Her-zegovina, Montenegro, North Macedonia, Albania, and Kosovo.

 

The Western Balkans have become an increasingly important pit-stop in the Chinese Digital Silk Road, a crucial element of the Belt and Road Initiative. The project is Beijing’s attempt to improve digital connectivity in participating countries — with China as the main driver of the process — and a key component of the country’s drive to increase its geopolitical influence. For the European Union, the region represents both its immediate neighborhood and also the group of countries that is first in line for future E.U. membership. Therefore, China’s digital influence in the Western Balkans could potentially be transferred to the European Union as well, if and when those countries become part of the European community. In addition to their E.U. membership aspirations, Montenegro, Albania, and North Macedonia are also members of NATO, and together with Kosovo have established close relations with Washington, especially on questions of defense and security. If China gains ground in the current and future development of digital infrastructure in the region, it could represent a security challenge not only for the region, but for the United States as well.

 

China has had success in the Western Balkans in promoting the Digital Silk Road. Serbia is China’s main partner, but apart from Kosovo, all of the Western Balkan countries have also cooperated with Beijing on digital technology up to a certain point. Importantly, China’s efforts in the region are being contested by other geopolitical players. The United States and the European Union are putting pressure on the Western Balkan countries to limit China’s presence in their digital infrastructure.

North Macedonia, Kosovo, and Albania have decided to limit or ban Chinese technology. The main question going forward is whether China’s impact on the region’s technological development will continue to grow, or whether the West will be able to offer a credible digital alternative. The West should focus on providing realistic alternatives to Chinese technologies in the region to protect its interests in the Western Balkans. It is not enough just to criticize Western Balkan countries for the advancement of cooperation with Beijing — a sustainable solution should be offered as well.

 

The Digital Silk Road Runs It

The Digital Silk Road is an important element of China’s Belt and Road initiative. At first, it was presented as an initiative to “advance the construction of cross-border optical cables and other communications trunk line networks, improve international communications connectivity, and create an Information Silk Road.” China has focused on the quicker building of bilateral cross-border optical cable networks, the planning of transcontinental submarine optical cable projects, and the improvement of satellite information passageways to expand information exchanges and cooperation.

The Digital Silk Road is established in the framework of the wider Belt and Road initiative and includes the global expansion of Chinese technologies to addressable markets previously dominated by local or Western firms, or to developing countries that are only now undergoing technological development. It ranges from telecommunications networks and smart cities to e-commerce and the Chinese satellite system. The initiative is often seen as a joint effort by the Chinese government and Chinese digital giants, but not all of the projects within the Digital Silk Road receive heavy support from the state.

 

China’s efforts to position itself as a global digital leader face significant he-adwinds. The Trump adm-inistration tried to limit Beijing’s outreach via the “Clean Network Initiative,” which the State Department defined as “a comprehensive approach to safeguarding [America]’s assets incl-uding citizens’ privacy and companies’ most sensitive information from aggressive intrusions by malign actors, such as the Chinese Communist Party.” Pres-ident Joe Biden — who has embraced competition with China — has not dismissed executive orders in the spheres of data flows and t-echnology supplies that we-re signed by his predecessor. Several countries in the Western Balkans have signed onto America’s Clean Network, including Albania, North Macedonia, and Kosovo.

Those who have not joined the initiative have been under pressure to limit China’s digital presence in the region. Under the new Biden administration, the United States is trying to (re)build a coalition with the European Union to counter China’s rising global influence. The countries of the Western Balkans will face direct pressure coming from Washington on one side, and from the need to align with E.U. policies on the other. The European Commission itself has taken precautionary measures and instructed member countries to adopt policies that will limit the presence of “high-risk suppliers.” Simply put, if the countries of the Western Balkans are serious about continued integration with the European Union, they will need to follow E.U. rules on digital technology.

China’s Closest Friend in the Western Balkans

Serbia is China’s closest partner in the Western Balkans, and this is reflected in the country’s approach to Chinese technology. While Serbia and NATO have agreed on an individual partnership action plan, Serbia does not aspire to become a member any time soon. On the other hand, Serbia does actively seek membership of the European Union. It has been a candidate country since 2012, although the accession process has slowed considerably in recent years. The European Union’s enthusiasm for adding new members has declined, and Serbia’s democratic backsliding makes the case for its membership less appealing. Although Serbia still maintains that joining the European Union is its primary foreign policy goal, the uncertainty of the future accession process h-as opened the door to influence from extra-regional powers, especially China.

 

Over the past decade, China has made significant inroads among Serbia’s political and business elites. In 2016, Serbia and China signed a comprehensive strategic partnership agreement. Leading Serbian politicians and the country’s pro-government media have promoted a narrative of “steel friendship” between the two countries. Data from 2020 shows that the amount of contracts signed with Chinese banks for the purpose of the upgrade of Serbian infrastructure has surpassed $7 billion.

 

Strategic and economic ties between Belgrade and Beijing have enabled increased cooperation in the digital and telecommunications spheres. Huawei has built its regional headquarters in Belgrade and is a longstanding partner of the state-owned telecommunications company, Telekom Srbija. China’s digital giant was also seen as a leading contender for the 5G launch in Serbia, before the Serbian government delayed the beginning of the process after pressure from the United States. The pressure came after Serbian President Aleksandar Vucic signed a “Washington agreement” in September 2020, which included an article dedicated to the banning of future involvement and pushing out of the current presence of “untrusted vendors” from the 5G network. Serbia justified the delay with “economic reasons caused by the Covid-19 pandemic.” However, the main reason for the decision was the government’s concern about potential consequences that could come from the West if Serbia does not explicitly limit the potential participation of Chinese companies in the country’s 5G rollout.

Despite this setback, companies close to Beijing remain a significant factor in Serbia’s digital infrastructure. In 2019, Belgrade introduced the Safe City project, implemented in cooperation with Huawei. It includes the installation of 1,000 security surveillance cameras equipped with AI software for facial recognition.

Like Bosnia and Herzegovina, Serbia has also expressed interest in the Smart City project. While Smart City presents a tool for local authorities to provide better public services for their citizens on the global level, the goal of the Safe City program is to increase the security and safety of the citizens of local communities. Both projects raise many concerns about digital privacy, the potential for the misuse of the technology, and the impact on human rights. The main issue among the public has become how the technology will be exploited by the Serbian government — which is increasingly authoritarian — rather than the identity of the vendor.

In addition to those projects, Huawei opened its innovation center in Belgrade in 2020 and has become the commercial user of the National Data Center in Kragujevac. The company also signed an agreement and provided a grant to Serbia for the development of the AI platform and cloud infrastructure for the National Data Center. The Chinese presence in Serbian digital development also goes beyond the cooperation with Huawei. Hikvision and Dahua technologies have also been presented, providing video surveillance solutions for both commercial and public safety uses.

China and the Rest of the Western Balkans

Given its close ties with Serbia, China will have difficulty making inroads in Kosovo — Serbia’s rival. Beijing has not established any formal diplomatic relations with Kosovo and will be unlikely to recognize it as an independent country. The state of affairs between the governments in Pristina and Beijing also means that there will be no development of cooperation within the Digital Silk Road. Kosovo is enthusiastically aligned with America’s Clean Network initiative.

North Macedonia and Albania have limited the possibility of Chinese influence in their digital infrastructure, including 5G networks. In 2020, both countries joined the Clean Network Initiative, reflecting their close ties with the United States.

China has a higher profile in Montenegro. In 2014, the country signed a loan agreement with the Chinese Exim Bank for the construction of a highway section that would connect the Montenegrin seaside with the Serbian border. Since then, the loan has contributed to a major increase in the country’s public debt. Montenegro allowed Chinese firms to participate in the country’s 5G rollout, but did announce that it will seek to diversify its suppliers to mitigate the security risk.

Bosnia and Herzegovina has not limited China’s digital influence. The capital city, Sarajevo, signed a Smart City memorandum of understanding with Huawei. While the deal will improve the country’s digital capabilities, it also opens the possibility of the misuse of personal data, intrusion into citizens’ privacy, and, in extreme cases, the overall control of their lives like in the social credit system introduced in China. Huawei has a strong presence in the country’s telecommunications system, and has been involved in the education system through cooperation with Mostar University and the “Seeds for the Future” program dedicated to IT students in the country.

Looking Ahead

Serbia remains the focal point of the Chinese Digital Silk Road in the region. Despite pressure coming from the United States and European Union, Serbia has continued to foster its digital development in cooperation with Chinese companies. This partnership within the framework of the Digital Silk Road is facilitated by close ties between the two countries.

The West is having greater success in blunting China’s digital influence in the rest of the Western Balkans. The incentives coming from the West (like Clean Network) are making an impact and have contributed to some countries not engaging with China on 5G. Countries that rely more on the United States for security and are more dedicated to joining the European Union are keener to limit Chinese influence. Albania, North Macedonia, and Kosovo have openly expressed their readiness to push China out of existing digital infrastructure and prohibit the participation of Chinese companies in further development. On the other side, Serbia, Montenegro, and Bosnia and Herzegovina have been more receptive to the Digital Silk Road.

China has come to the Western Balkans to stay. Western efforts to limit Chinese influence and provide sustainable alternatives should continue, especially in countries like Serbia, Montenegro, and Bosnia and Herzegovina that could be vulnerable to external pressure. China may someday translate its growing involvement in the digital infrastructure of the region into geopolitical influence.

The West has an interest in preventing that from happening.

 

Source:The Frontier Post