Milos Zeman Ye Jianming Xi


Zeman’s Promises Of Chinese Investment Fail To Materialize

Andrej Babiš, CEFC, China, CITIC, Czech Corruption, Miloš Zeman, Ye Jianming

Prague, April 20 (CTK) – The promised inflow of Chinese investments has not come and China is playing a game which is mostly political and in which the Czech Republic has the role of their Trojan horse in the European Union thanks to President Milos Zeman, Jan Klesla says in daily Lidove noviny (LN) today.


Chinese President Xi Jinping assured Zeman in writing that the flow of finances from China to Czechia will continue, but this formulation from Xi’s letter shows well what is wrong in the relations between the two countries: there has been no influx of investments and there is no signal that anything such would come, Klesla writes.


However, Zeman and his collaborator Jaroslav Tvrdik, who heads the European office of the Chinese CEFC firm half of which has recently been taken over by the Chinese state-run CITIC Group, want to create the impression that the Chinese are making huge investments in the country, Klesla says.


When CITIC representatives met Czech Prime Minister Andrej Babis earlier this week, they said the CEFC investments in the country reached about 1.5 billion euros or some 38 billion crowns. But Zeman promised during Xi’s pompous visit in Prague in March 2016 that these investments would reach 95 billion crowns by the end of 2016 and 232 billion crowns by 2020.


By the end of 2016, foreign investments made in the Czech Republic reached 3,124 billion crowns in total. South Korea, Japan and the United States have each invested far higher sums in the country than China, same as many EU countries.


The centre-left government of Bohuslav Sobotka (in office 2014-17) warmly welcomed and promoted the New Silk Road project, against which 27 ambassadors of EU countries in Beijing recently warned. These diplomats say the project is designed to undermine free trade and give advantages to Chinese firms. The only one who did not join this call was the ambassador of Hungary, to which China promised really major investments, Klesla writes.


Even if Chinese money started flowing to the Czech Republic, it would depend where it would be invested. The CEFC and CITIC are mere financial investors who buy assets such as real estate or try to gain control over banks that would be crucial for a further expansion into the EU.


It is no wonder that Babis was not interested in such a Chinese offer very much, Klesla writes.


As the unemployment rate is very low, the country does not need more contracts for assembly plants but rather smart money that would bring know-how and better salaries for employees, Klesla says.