This chapter analyses to what extent China’s activities in the Western Balkans conflict with the objectives of the EU’s enlargement policies.

3.1 EU and Chinese foreign policy objectives

The 2003 Thessaloniki Summit put the EU membership perspective of Western Balkans countries in clear terms, when it was concluded that ‘The future of the Balkans is within the European Union’.[116] Reminded by the bitter wars accompanying the dissolution of Yugoslavia, the EU is engaged in an intensive process of stabilisation and association with the six Western Balkans countries to foster peace and stability in the region.[117] By providing a membership perspective, the EU aims to spur reforms in line with EU norms and values. EU membership criteria have been formulated in the so-called Copenhagen Criteria, constituting key political, economic, and administrative and institutional requirements for aspiring EU members (see textbox below). A Copenhagen+ criterion regarding regional cooperation and good neighbourly relations has, moreover, been specifically added for the Western Balkans. This criterion stems from the above-mentioned objectives of fostering peace and stability in the Western Balkans, but also serves to ensure that the EU does not import outstanding bilateral conflicts when accepting new members.

The core objectives of the EU towards the WB region are thus to foster peace, stability, democracy and the rule of law, and to ensure alignment with all norms, values and legislation of the EU through legal approximation. The final objective of the EU’s engagement with the region remains full EU membership, as confirmed most recently by European Commission President Ursula von der Leyen when publicly communicating that ‘the Western Balkans belong in the EU’.[118] EU engagement with the region is hence not a standard example of foreign policy. The EU pursues an all-encompassing approach, employing its full policy toolbox, including many elements of EU internal policies, in its attempt to draw the region closer.

When assessing EU objectives towards the Western Balkans, the EU tries to diffuse its values both for normative and self-interested reasons. Arguably, there can be some degree of tension between the EU objectives of stability and democratisation in the WB6 (as a longer-term process). A heavy emphasis on regional stability in the short term could lead to a weak, inconsistent application of EU conditionality that strengthens autocratic governments at the cost of democratic forces in the WB6.[119] It is nevertheless hard to imagine the European Union allowing into the EU a WB state that has not completely undergone processes of democratisation and improvements to the rule of law, given the increased focus on these ‘fundamentals’, as codified in the 2020 revised enlargement methodology.

The rather limited Chinese objectives of increasing economic engagement with and connectivity within the region do not seem to be at odds with the EU’s objectives in its approach towards the region at first sight. The Chinese business-first approach, revolving mainly around objectives of economic investment and development, can by no means be compared to the scope, depth and level of ambition of what the EU seeks to accomplish in the region. Boosting physical connectivity through infrastructure development is moreover not only a Chinese affair. The EU itself has a connectivity strategy for third countries, including the WB6, and it finances infrastructure development through its pre-accession funds and the European Investment Bank in order to spur economic convergence of the region with the EU. The EU may hence benefit from increased Chinese investments in the Western Balkans, especially as the region is in need of large amounts of external financing to catch up economically with the EU-27, something the WB6 need to do to a considerable degree before acceding to the EU.

It should be acknowledged that Chinese economic engagement, as chapter 1 highlighted, cannot be seen separately from China’s geopolitical interests. For the EU, this is relevant mainly in regard to the value base of Chinese engagement with the region. The Chinese government’s attitude towards political and economic values is different from the EU’s to such a degree that simultaneous engagements of China and the EU with the Western Balkans, as the next sections show, inevitably lead to conflicting choices for the region’s governments.

3.2 The formation of EU–Western Balkans linkages – hampered by China?

In pursuit of their strategic objectives, the EU and China have divergent instruments at their disposal and also employ these instruments to different degrees. The extent to which the EU has established political and economic linkages with the Western Balkans, as well as the highly institutionalised nature of those linkages, matches the ambitious and all-encompassing objectives that the EU pursues in the region.

The EU’s relationship with the WB6 is institutionalised through legal treaties, regular summits between Western Balkans and EU leaders, and continuous active engagement from the European Commission (particularly the Directorate-General for Neighbourhood and Enlargement Negotiations, DG NEAR), the High Representative of the Union for Foreign Affairs and Security Policy (HR/VP),[120] the EU Delegations and the EU’s Special Representative for the Belgrade-Pristina Dialogue, currently Miroslav Lajčák. The relationship is highly intensive, bureaucratic and characterised by fixed process and documentation, establishing detailed benchmarks and recommendations for aspiring members. Economically, the WB6 are required to submit annual Economic Reform Programmes (ERPs) to the European Commission, outlining their economic projections and reform agendas to ensure alignment with the economic membership criteria. As such, core sectoral economic strategies are fully geared towards the EU. Supranational engagement from the EU is moreover reinforced by bilateral political engagement from (groups of) EU member states, which comes in both classic foreign-policy form but in the Western Balkans also takes an institutionalised form, such as is the case in the Berlin Process.

These institutionalised ties between the EU and the Western Balkans countries are tight, and Chinese engagement does not form a direct threat to the WB6 countries’ EU aspirations. However, in some countries, notably Serbia, institutionalised ties with the EU are also increasingly paired with political ties with China, in an attempt by incumbent leaders to maximise the benefits of external engagements. This has implications for the environment in which EU accession and enlargement processes play out, in which for some countries the EU is no longer the ‘only game in town’. As chapter two already indicated, while for most WB6 countries the determination to join the EU remains the main driving force behind WB–EU ties, the push to deliver economic progress and jobs, as well as to raise their negotiating power vis-à-vis the EU, has made the WB6 rather open to Chinese linkage formation efforts.

Economically, the EU remains the largest economic partner of the Western Balkans: the EU provides subsidies, not just loans, and EU foreign direct investment outperforms Chinese FDI manifold. The EIB and the EBRD are engaged in various investment projects throughout the region, including large-scale infrastructure projects such as the Corridor X motorway across Serbia.[121] The EU provides ‘carrots’ in the form of financial assistance through so-called Instruments for Pre-Accession Assistance (IPA) funding, visa liberalisation and preferential market access to its internal market. The European Commission also announced macro-economic support for the WB6 as a response to the COVID-19 crisis. It is also preparing an economic development and investment plan for the region, which is to be published in 2020. Imports of goods from the EU-27 in 2019 accounted for 61.8 per cent of regional imports, while exports in the same year stood at 82.9 per cent. China, with which WB trade has increased during the past decade, still stands nowhere near these numbers: WB6 imports from China accounted for 9.2 per cent of total imports, and exports for just 1.8 per cent. Whereas the EU-27 are the top trading partners for the WB6, China often finds itself behind the UK, Serbia, Turkey or Russia.[122] With the WB6’s geographical proximity to, and increased interconnection with, the EU’s single market, it is highly unlikely that Chinese trade or FDI will overtake the EU’s economic engagement as a whole any time soon.

3.3 EU standards and values – affected by China?

The EU’s objective of attempting to bring the WB countries to full adherence with EU standards, rules and values is made more difficult by the involvement of actors with alternative standards, rules and values that have potentially lower adoption costs than those of the EU.

Political

EU standards on good governance/corruption

EU engagement with the WB6 is predicated upon large-scale governance reform. A concrete example of this is that in the EU’s approach, chapters 23 and 24 of the EU’s acquis communautaire regarding the judiciary and fundamental rights, and justice, freedom and security, respectively, have been placed in a central position. Such emphasis on the rule of law is absent from China’s economic state-to-state loans.[123]

From an EU viewpoint, China’s approach is problematic, because the conditions attached to external financing are vital in fostering governance reform, especially in transitioning economies. The inflow of external financing from authoritarian countries to emerging democracies lacking ‘transparency, accountability and market orientation’ can, without the proper checks and balances in place, reinforce corruption and undemocratic practice.[124] In a region such as the Western Balkans, where issues of state capture and corruption are ubiquitous, elites being captured by such ‘corrosive capital’ is markedly a threat.[125] The absence of a good governance agenda similar to that of the EU makes Chinese economic engagement an attractive alternative for Western Balkans’ strongmen. Not having to comply with transparent tendering procedures, accountability and other elements of governance reform, but still receiving much-needed capital, makes WB leaders less dependent on the EU, and enables them to preserve their vested economic interests. While some have argued that it is in the interest of China to promote good governance reforms in the WB region as well, the current absence of a Chinese good-governance agenda for the WB6 remains problematic from an EU perspective.[126]

EU standards on fundamental human rights and freedom of expression

Human rights, freedom of expression and pluralism are principles that are central to the functioning of democracy and are part of the EU’s core values, as enshrined in the treaties, rights and principles enshrined in the European Charter of Fundamental Rights and chapter 23 of the acquis communautaire. Media freedom is a crucial part of freedom of expression and it is generally acknowledged that independent media plays an important role in highlighting political corruption, as such acting as the crucial fourth pillar of a functioning democracy. The WB6, however, continue to perform low in the World Press Freedom Index, with especially Serbia showing a strong downward trend.[127] While it is unclear whether media outlets in the Western Balkans are directly or indirectly owned by Chinese entities, there are examples of formal and informal cooperation with Chinese news agencies, for example Serbia’s Tanjug news agency, which publishes pro-Chinese reports as part of a cooperation agreement with China’s Xinhua.[128] China does pursue a campaign of expanding Chinese media influence abroad, so future investments in the WB6 media landscape cannot be ruled out.[129] These could lead to altered reporting on China in terms of both coverage and content. Recent billboards in Serbia portraying Chinese Chairman Xi Jinping with the text ‘Thank you, brother Xi’ were erected by the Serbian magazine Informer, which is testament to the fact that a more pro-Chinese stance is entering the national media discourse in Serbia.[130]

Chinese standards on media freedom and human rights deviate substantially from those of the EU, with China ranking 177 out of 180 in the World Press Freedom Index. The lack of Chinese support for international norms that protect human rights, such as the freedom of expression, plays into the hands of those Western Balkans governing elites with autocratic governing styles. China’s economic engagement without an agenda for strengthening fundamental human rights, similar to its lack of good governance efforts, is problematic for the EU.

Economic

EU standards on public procurement and infrastructure development

Reforming public procurement – chapter 5 of the acquis communautaire – in the Western Balkans is a key priority of the EU, as reflected by its inclusion in the ‘fundamentals’ cluster in the revised enlargement methodology. For future integration of the WB6 into the EU’s single market, public procurement needs to facilitate open market competition and take place in a transparent process that is open to all companies on the basis of non-discrimination and equal treatment. China, instead, requires countries to select Chinese contractors for much of the implementation when offering loans for infrastructure projects. Large Chinese infrastructure projects are therefore often implemented through inter-governmental agreements, which open the door for lex specialis (special law) procedures that bypass public procurement law. This practice reduces transparency of funding and opens up possibilities for corruption.[131] A prime example is the special law that was passed in the Montenegrin parliament ratifying the government loan with China for the Bar–Boljare highway, which bypassed Montenegro’s national public procurement law.[132] The same could be observed in Serbia, where the non-governmental organisation Transparency Serbia criticised the Serbian parliament in May 2019 for passing inter-state agreements with China that bypassed procurement law and took place in an untransparent manner, with no details publicly available on the project evaluation and/or cost analysis.[133] According to the European Commission, while Serbia’s public procurement law ‘is largely in line with the acquis’,[134] the real issue is that projects on the basis of state-to-state agreements are exempted from its application. Apart from issues of the law’s compatibility with EU standards, compliance is hence an important problem, especially ‘in big infrastructure projects financed or implemented by non-EU companies’.[135]

The EU itself also provides loans for development projects in the Western Balkans through the EBRD and the EIB. The Western Balkans Investment Framework (WBIF), a joint facility of the European Commission and European investment banks and donors, helps WB countries to access funding for much-needed strategic investments in line with their EU accession goals. EU loans come attached with a wide host of conditions and procedures that intend to guarantee financial feasibility, environmental sustainability and the quality of infrastructure development, as well as adequate labour conditions and transparency of procedures. The availability of China as an alternative lender means that if EU institutions deny funding of a project for feasibility reasons, the WB6 governments can often turn to the Chinese, as happened in the case of the Bar–Boljare highway in Montenegro.[136] Even if projects are deemed feasible by EU institutions, EU standards necessitate high local bureaucratic capacities and increase the time duration from when projects are formulated, agreed to and started.[137] Chinese loans from state-owned entities such as the China Exim Bank signify that the Chinese government probably regards relevant projects as a political priority, which are then swiftly approved. However sizable EU loans might be, Chinese loans make an attractive alternative.

Logically, inter-governmental agreements between China and the WB6 on infrastructure investment, once established, have implications for EU norm diffusion beyond the field of public procurement itself, because due diligence and sustainability considerations as enshrined in EU standards are waived. This risks low-quality and financially inviable projects, hampers the development of the WB6 economies towards well-functioning market economies, as well as hampers the objectives of government transparency and banning economic corruption practices. The North Macedonia Kichevo–Ohrid highway, built by Sinohydro with a contract financed by China Exim Bank, for example, showed that lack of transparency brings a risk of lowering the quality of the project. Estimates regarding soil structure proved to be wrong during implementation, and no junctions were reportedly planned for the entire 57-kilometre road.[138]

EU standards on macro-economic stability

Countries that seek to accede to the EU are required to abide by the Stability and Growth Pact (SGP) on fiscal surveillance – chapter 17 of the acquis communautaire – which regulates EU standards on budget deficits and maximum debt. In short, the annual budget deficits of EU member states must not exceed 3 per cent of GDP and public debt must not exceed 60 per cent of GDP.[139] Relatively small Western Balkans countries that assume relatively large amounts of debt risk being unable to abide by these rules, or ultimately to repay their debts. Montenegro, especially, is at a high risk because of the large scope of the Bar–Boljare highway project relative to the size of its economy, as it owes 20 per cent of its total foreign debt or 11 per cent of its GDP to China.[140] North Macedonia is indebted to China to a lesser extent, owing at least 14 per cent of its foreign debt to China in 2019.[141] High foreign debts may lead to debt distress, with negative consequences, including being forced to cut domestic spending and increased interest rates on new government bonds. These effects can be observed in Montenegro and may in the medium to long term also have destabilising effects on the political level.[142] Second, owing a large share of foreign debt to a single country poses dependency risks. In the case of Montenegro, its high debt to China could open the door for undue geopolitical influence. The main problem is not Chinese funding in and of itself, but the means through which funding is done (state-to-state engagement) and the (lack of) conditions attached if they are not in line with EU standards and good governance standards. Coming back to the SGP, it should be noted that also within the EU the rules on maximum debt and budget deficits are regularly infringed upon by individual EU member states and only selectively enforced by the European Commission, which has problematic implications for the EU’s credibility in its normative engagements with the Western Balkans.

EU standards on the environment and energy

The Western Balkans remains one of the most polluted regions in Europe, with one reason being that WB countries still depend to a large extent on low-level lignite coal for electricity production.[143] Environmental sustainability is one of the standards by which European investment banks decide on their funding, so the EU has not provided funding for polluting coal plants. China, a large exporter of coal and itself heavily reliant on coal plants for energy, is providing the WB region with an alternative to the EU by funding coal-plant investments. China’s investments in the Zelezara Smederevo steel company and the RTB Bor copper mine and melting company in Serbia saved local employment, but these outdated facilities create excessive air pollution, with considerable environmental damage. While WB countries are so far not technically bound by EU environmental standards, plants will need to be retrofitted in order to continue operations if EU membership is secured. Specifically, the EU requires coal plants to comply with its ‘Best Available Techniques’ standards under its Industrial Emissions Directive (Directive 2010/75/EU), which would require tremendous investments. Additionally, with EU plans for a new green deal underway, a more costly EU Emissions Trading System (EU ETS) would be a death knell for the business models of these polluting coal plants.[144] While abiding by the EU’s environmental standards is the responsibility of domestic actors in the Western Balkans, they receive the opportunity not to do so as a result of the availability of Chinese-backed funding.[145] Chinese economic engagement in the region hence allows the WB6 to avoid costly EU environmental standards in the short run, while undermining their EU integration path in the mid- to long term.

EU state aid standards

The Stabilisation and Association Agreement (SAA) and the Energy Community Treaty oblige WB6 countries not to introduce state aid measures that would distort competition between the EU and WB6 countries. Large state aid measures favouring certain energy sources, such as coal, over others are not compatible with the SAA and ultimately with the EU treaties. This led to a procedure against Bosnia and Herzegovina in which a Chinese loan for coal powerplants in Tuzla was deemed to be non-compatible with EU state aid rules.[146] While China is not directly responsible for state aid violations in the Western Balkans, the larger state intervention that China’s state-to-state loans bring with them has negative, distorting impacts on WB6 markets. Strict EU rules on state aid mean that WB governments need to reduce state intervention in the economy, whereas in the Chinese economic model the state has a much larger role.

Security

Privacy and data protection standards

Serbia’s cooperation with Huawei in its ‘Safe City’ project, with mass video surveillance, raises questions regarding compatibility with EU standards on privacy and data protection, as enshrined in the EU’s General Data Protection Regulation (GDPR). Serbia has recently been named a ‘hybrid regime’ in the Nations in Transit report from Freedom House and such mass video surveillance is feared as a way to suppress civil liberties, including the right to privacy.[147] Kosovo and Serbia have transposed the GDPR into their own regulatory frameworks, but implementation is proving difficult.[148] The problem is not mass surveillance per se, but rather that lack of oversight and proper implementation of data protection rules leaves Serbian citizens vulnerable to political abuse.[149] There are growing concerns that mass video surveillance by the Serbian government represents an intrusion into the privacy and civil rights of citizens, as large amounts of facial recognition data are collected, without precise rules for their processing.[150] This opens the door for the use of this data for political reasons and to use technological measures to keep check on critical voices in society, which contrasts strongly with the EU’s objectives of forging democracy and the rule of law.

China is developing its own standards for data protection and privacy, but while protecting against private entities, its standards do allow governments to build backdoors into software for reasons of public security.[151] While Chinese standards do provide some protection to consumers against abuse by businesses, which is meant to increase consumer confidence in the digital economy, they also provide large opportunities for an increase in government access to personal data.[152] EU standards, embedded in the GDPR, come in the legal form of a regulation, meaning it is directly applicable to EU law. Divergence from the GDPR in the form of disproportional state surveillance relative to citizens’ rights and freedoms, and unclear implementation of the EU’s data privacy regulation, would mean that EU candidate countries remain ineligible for EU membership until this is rectified.

Regional cooperation and good neighbourly relations

Resolving bilateral conflicts between Western Balkans countries in order to strengthen regional stability is one of the prime goals of the EU enlargement process. The so-called ‘Copenhagen Plus’ criteria include politically sensitive conditions on reconciliation and regional cooperation that WB countries have to fulfil before they can join the EU. In the case of the Serbia–Kosovo question, Chinese support for Serbia's non-recognition of Kosovo, by continuing to vote against Kosovo's membership in international organisations, is being seen by the EU as not conducive to finding a sustainable solution. While China is not expected to oppose a potential normalisation agreement between Serbia and Kosovo, its position on the issue and its explicit support for Serbia provide the latter with additional leverage.[153] China is not actively supporting the EU and US-led processes for a resolution of the conflict, nor has it initiated solutions itself. While China is not the only external actor that can be said to influence the reconciliation process between Serbia and Kosovo, and also while the EU’s own mediation between Kosovo and Serbia is complicated by the non-recognition of Kosovo by certain EU member states, China’s stance is unconducive to resolving this bilateral dispute in the EU-propagated manner, which would allow both Serbia and Kosovo to advance on their path to EU membership.

3.4 Chinese effects on EU socialisation and accession conditionality mechanisms

Socialisation and accession conditionality are the two main mechanisms at play through which the EU seeks to obtain its objectives in the Western Balkans. This section investigates the influence of China on the effectiveness of these mechanisms.

Socialisation

Socialisation happens when actors change their identities and preferences in a process of argumentative persuasion in accordance with EU standards and values. Rather than focusing on the short-term prospect of incentives, socialisation reflects a long-term change of mindset by which actors become convinced of the legitimacy of EU rules.[154] For such internalisation to take place requires that EU rules are seen as legitimate, that the target society itself identifies with the EU, and that there is a level of domestic resonance towards EU standards, values and rules beyond the government level.[155] To a certain extent, socialisation takes place passively. At the same time, there is an active component in which the EU (or other actors) actively promotes socialisation processes through soft-power strategies, such as subsidising civil society throughout the Western Balkans and organising student exchanges with the region.

With regard to socialisation, China is well aware of the influence of ‘soft power’ and while it does not pursue an overarching Western Balkans soft-power strategy, it does seek cultural engagement with individual countries. Ranging from Confucius Institutes offering Chinese-language courses to ‘friendship associations’, these initiatives are meant to promote people-to-people contact in key countries linked to the Belt and Road Initiative. It is hard, however, to separate China’s soft-power strategy in the Western Balkans from the appeal of China’s own economic achievements and the economic engagement that it offers.[156] China’s public diplomacy engagements, constituting the ‘active’ part of socialisation, have been welcomed in Western Balkans societies but have not been perceived as comparable to the region’s Euro–Atlanticist integration. Besides Western Balkans governments, societies must also be convinced of the legitimacy of standards introduced by third powers, and societal debates on China have so far not taken off in the WB6.

Given that China-WB6 relations are primarily focused on economic engagement, the level of socialisation between the WB6 and China will remain very much dependent on the appeal of the economic opportunities that China offers. If China manages to maintain its image of an economic superpower and overcome some of the teething problems of the BRI’s first decade, the WB6 may increasingly also regard some of the norms of China’s political model as an example. Increased economic and political linkages between China and the WB6 may hence lead to enhanced ‘passive’ socialisation between the two, and may also make China’s soft-power instruments (the ‘active’ component of socialisation) more resonant in WB6 societies. As chapter two outlined above, there are several factors on which such socialisation will depend. There is a degree of disappointment in the WB region about the limited level of Chinese investments that have taken off. Yet even if China’s economic involvement brings fewer benefits than had been hoped, the potentiality of China as a significant economic partner is likely to remain a major factor. Given that China represents a completely different governance model than the EU, enhanced socialisation will – even if at a considerably lower level than with the EU – have a disadvantageous influence on the WB region’s EU integration process. On the political level, especially Serbia’s current government is increasingly presenting China publicly as an example for Serbia. While this may be just a deliberate political discourse, it has a real effect on the EU’s efforts to draw Serbia closer. It is hence of utmost importance for the EU to continue adequately to display the benefits of the EU’s own governance model. As long as the EU is able to do so, socialisation will remain a powerful mechanism for the EU to exert its influence in the WB.

Conditionality

Accession conditionality is seen as the most powerful mechanism through which the EU is able to exert its influence in the Western Balkans.[157] By holding EU membership as conditional on reforms, the EU exerts pressure on WB governments to engage in the all-encompassing transformative processes that are needed to accede to the EU.

The mechanism of conditionality is, however, affected by China’s increasing presence in the Western Balkans in two main ways: cross-conditionality; and increasing opportunity costs for adopting the EU acquis. Cross-conditionality can be defined as ‘other sources offering comparable benefits at lower adjustment costs’.[158] Stringent and vast EU rules mean that adjustment and adoption costs for the WB6 are considerable. If external actors such as China offer economic development without the stringent rules attached to EU conditionality, then the effectiveness of the EU’s conditionality is reduced because of the availability of alternatives. It should be noted that one can argue whether China offers ‘comparable benefits’ compared to the overall offer of EU integration. EU integration transcends economic benefits such as access to the EU’s internal market and EU cohesion funds. Becoming a member means gaining a seat at the table of the EU’s political institutions, becoming part of a geopolitical power that is focused on cooperation and the rule of law, etc. Why do the countries of the Western Balkans then still engage in a balancing act, sometimes seemingly deliberately undermining their progress towards accession? When reducing alignment to a cost-benefit analysis, one should ask whose costs and benefits are discussed. While objectively the benefits for a country of acceding to the EU may be clear, in practice decisions about transformative power lie with political elites whose vested interests may not align with the objectives of EU enlargement.[159] This is because, economically and politically, such political actors continue to thrive only because EU standards on rule of law and democracy are not enforced. Established dynamics of corruption, clientelism and nepotism mean that, while reforms may be in the general interest, they are not in the private interest of those in power, for whom reforms come with immense adoption costs. While nominally in favour of EU accession, political leaderships therefore often ensure that adoption, implementation and enforcement of EU-intended reforms happen only to a point where it touches upon such interests.[160] Looking at costs and benefits, we should also not underestimate the importance of narratives: the impression that China is doing much to help WB countries grow economically, or support them with health regarding COVID-19, might be more important for public opinion than factual information on FDI and EU grants, or exact trade figures for the region.

Second, adopting EU rules means rejecting alternative benefits from external actors, which in turn generates opportunity costs. These costs increase as the alternative offers to Western Balkans countries, other than the EU offer, become more attractive. In some WB6 countries, this has led to what chapter two referred to as ‘political multi-polarity’, or the strategic balancing between multiple offers to extract maximum gains out of the available linkages. That strategy is in line with the time-tested Titoist foreign policy that sought to balance engagement with external actors in order to maximise offers from each of them. Serbia, in particular, is a country of sufficient size to be able to engage external powers to maximise offers from multiple actors, and under its current government it seeks to do so.[161] The EU enlargement process is an ongoing negotiation premised on asymmetric interdependence: candidate states gain more from the EU than the other way around, which gives the EU leverage and negotiation power.[162] When seen from a negotiations perspective, increasing (apparent) engagement with third powers and raising geopolitical stakes represents one of the few opportunities that accession candidates have to strengthen their negotiating power vis-à-vis the EU. China’s increased presence in the WB region hence puts pressure on the effectiveness of EU conditionality, as its effectiveness is partly dependent on the absence of potential alternatives.

3.5 Conclusions

On the level of overall objectives, China’s and the EU’s explicit intentions do not seem at odds. Economic and infrastructure development in the Western Balkans are objectives shared by both powers, as well as by the region itself. Also when it comes to actual linkage formation, China does not provide a significant challenge to the EU. The institutionalised multi-level relationship of the EU and the WB6 is laid down in an all-encompassing process, affecting nearly all facets and levels of governance in the region. Political linkages between the WB6 and China are by no means comparable, as they do not dispose of a targeted institutional structure and remain limited mostly to the political level. Economically, China’s development as a geo-economic superpower, embodied in its expanding Belt and Road Initiative, may lead it to increase its relative economic footprint in the Western Balkans, but it is highly unlikely that linkages will grow to levels similar to the EU.

That is not to say, however, that all is rosy in the EU’s ‘inner courtyard’. The assessment of selected political, economic and security standards that the EU seeks to diffuse in the WB6 shows that engagement between the WB6 and China involves political choices that are incompatible with harmonisation with EU acquis and EU standards. EU objectives of fostering good governance are directly and indirectly affected by economic engagements between the Western Balkans and China that bypass public procurement law, take place in an untransparent manner, or may be neither economically nor environmentally sustainable from the EU’s point of view. EU state aid rules, as well as macro-economic sustainability objectives, are put aside in these engagements, meaning that the already vulnerable economies of the WB6 become even more susceptible to debt distress and Chinese influence. While respect for fundamental freedoms and human rights remains a key pillar of EU engagement, the issue is fully absent from China–Western Balkans relations. Looking at security, risks emerge with regard to data protection and privacy, as well as with the EU’s objectives of fostering stability through conflict resolution, as in the case of Serbia and Kosovo. Simply put, the WB region’s engagement with China or the EU comes with different strings attached.

Finally, this chapter assessed the influence of China on the two main mechanisms through which the EU actively and passively seeks to draw the Western Balkans closer: socialisation; and conditionality. With regard to conditionality, the presence of an alternative actor offering economic benefits at lower adoption costs means that the EU’s conditionality becomes less effective. Socialisation, meanwhile, the process of WB actors internalising EU standards and values and increasingly considering them as legitimate, is a slow-moving process. Increased linkages between China and the WB6 may lead to enhanced socialisation between the two. As long as China remains economically successful, it will be able to use its soft-power toolbox to send the message that economic success is not dependent on human rights, transparency or democracy. Whether or not that message comes at the detriment of socialisation with the EU depends on how the WB6 governments perceive that message. Chapter two indicated that, despite regional variations, the perception of China as an attractive economic partner to close the development gap is not yet contested. While Chinese engagement might now be relatively small compared to EU engagement, there can be path dependencies that lead the WB6 away from EU convergence in the future, such as when external financing allows them to invest in polluting power plants that might not be financially sustainable within the EU or in line with the EU’s stringent environmental standards.