Chinese Investment: Opportunities for the Belt and Road Countries
Chinese investment is really a great opportunity in the current landscape, because after the financial crisis, we have a squeeze of total investment flows in the world, and the post-crisis process was not enough sufficient in order to build more flows of direct foreign investment.
Editor’s Note: With the strong growth of Chinese economy, more and more Chinese investment has begun to go abroad in recent years. In particular with the Belt and Road countries, what opportunities will Chinese investment bring for local development? David Gosset, the founder of Europe-China Forum, discussed with Daniela Bobeva, former Bulgarian Vice Prime Minister. She has served in several cabinet-level positions including Minister of Trade and Economic Cooperation, as well as at the Foreign Investment Agency.
China Opportunities, hosted by David Gosset, is a global dialogue with senior officials, business elites and distinguished people. The serial interviews are coproduced by China Focus and DG2CI Limited in association with Academy of Contemporary China and World Studies.
David Gosset: You are an expert on the trade. And of course, we know that the Chinese investments across the world, this is a big issue for experts like you. How do you see it? do you see them as an opportunity?
Daniela Bobeva: In order to say whether this is an opportunity or this is a risk, it is important to make certain surveys. So, on the background of surveying Chinese investments abroad, from academic point of view, we came to the conclusion that Chinese investment is really a great opportunity in the current landscape, because after the financial crisis, we have a squeeze of total investment flows in the world, and the post-crisis process was not enough sufficient in order to build more flows of direct foreign investment. So that’s why Chinese investment and China came in this market providing good opportunities for all countries in the world. So, yes, it is an opportunity.
David Gosset: I’m going to zoom in now, because, of course, you come from Bulgaria, and how is China seen from a Bulgarian perspective?
Daniela Bobeva: Frankly speaking, we have a very good trade with China, mostly importing goods, and we have negative trade balance with China. But as in terms of investment, there were no surveys, no studies, so we completed just a couple of months ago a large survey on all Chinese investments in Bulgaria, and we are sending the message that they contribute to the GDP, they contribute to the employment. And also, we have some innovations coming through Chinese investment. So, we are going to feed the politicians with the background information about Chinese investment. If you look at the literature, you could see that there are many surveys that focus on one or another side. It is important that Chinese investment, they are very diverse.
You have huge state-owned companies. You have small and medium companies that bring a lot of benefits for the recipient country. So, you should look in general, in total, this is diverse not only in terms of content, but in terms of motivation also, because profit maximizing is one, but positioning in the market is another reason. So, you have this mixture of motivations, which makes the Chinese investment very different from the conventional thinking we have.
David Gosset: You said something very important, Madam. You said that Chinese investments in our countries, it means jobs, and jobs are always very much welcome. Now, thinking about your country, Bulgaria, we think about its geographic location, which is very unique, and it’s an asset, it is an asset for your country, but it happens also to be on the Belt and Road. And this has been a very important project proposed by China in 2013. Would you see this vision of a cooperative Eurasia as an opportunity?
Daniela Bobeva: Cooperation is a key word here. There were a lot of political events in Bulgaria and in China, in order to strengthen the initiative, Chinese initiative, but unfortunately, there were not many things happening. There were a lot of nice discussions about you need enforcement mechanism in order to make all these beautiful ideas come true. So, what has been done? Bulgaria considers this as another opportunity, because we have too much concentrated trade within the European Union, which could make the country vulnerable to everything what is happening in the Union and particularly in the euro area, because you know that we are fixed to the euro.
So, this is another closing. But we need to diversify our portfolio of trade partners, and China is a good opportunity for us. In Bulgarian, “belt” means, historically, something where you keep money in. So, we may consider for Bulgaria that this is a way to get more money in the belt. So, that’s a good initiative, and we like not only the name, but the nature of this initiative.
David Gosset: Thank you very much. We will remember this important metaphor. And clearly seen from this perspective, the Belt and Road is, for you, but also for this part of Europe, the Eastern part of Europe, an opportunity. Thank you very much for being an engine and an actor of this era of Chinese Opportunities. Thank you.
Daniela Bobeva: Thank you, sir. Have a nice day. Thank you.