Chinese Influence in Central and Eastern Europe

Chairman Kean, Ranking Member Keating, and members of the subcommittee, thank you for the opportunity to address you today on this important subject. My work focuses on the political economy of Central and Eastern Europe (CEE), as well as the transatlantic relationship. The challenge of China has been casting an ever-larger shadow over Europe and the transatlantic partnership, particularly in the wake of Russia’s full-scale invasion of Ukraine, which itself came on the back of the announcement of a “no-limits” partnership between Moscow and Beijing. Assessing China’s influence in Europe is a daunting task. For one, European governments are pursuing different approaches in their engagement with China and harbor different perceptions of risk toward Chinese economic practices, investment, and technology. The European Union itself has seen China simultaneously as “a cooperation partner with whom the EU has closely aligned objectives, a negotiating partner with whom the EU needs to find a balance of interests, an economic competitor in the pursuit of technological leadership, and a systemic rival promoting alternative models of governance.” [i] Even the EU institutions have been voicing subtly different messages about the bloc’s relationship with China, ranging from a need to nurture “stable and constructive relations” (as per European Council president Charles Michel), [ii] through Beijing’s disappointment with the Commission’s President Ursula von der Leyen, [iii] to the European Parliament’s frequent though symbolic support of the Uyghurs, [iv] Tibetans, [v] and Hong Kong. [vi] The EU’s internal divisions were on full display during the visit of Emmanuel Macron and von der Leyen to China in April 2023, during which the Chinese Communist Party (CCP) offered starkly different welcomes and levels of access to the two European leaders. [vii] This statement focuses on the CEE region, the Balkans, and countries of the so-called Eastern Partnership. The region presents almost as much variation in China policies and levels of economic integration and technological penetration by China as does Europe at large. It also illustrates the simultaneous presence and the tensions between the cooperation, competition, and rivalry that underpins Europe’s relationship with China. With Russia’s war of aggression against Ukraine, backed by China’s record-high purchases of Russian oil [viii] and gas [ix] and its direct support to Russia’s military-industrial base, [x] the CEE region offers a stark reminder that the European and Indo-Pacific theaters are not easily separable. For one, Eastern Europe offers examples of countries that have aspired to join the EU and NATO, yet whose exclusion from Western political and security structures has created an opening for Chinese influence, which the collective West may yet come to regret. In engaging those countries under the US security umbrella, however, Washington does have leverage and means to thwart Chinese efforts at building influence while also reassuring its allies. The United States should not be afraid to use such tools. Read the full testimony here. [i] European Commission, “Commission Reviews Relations with China, Proposes 10 Actions,” press release, March 12, 2019, https://ec.europa.eu/commission/presscorner/detail/en/IP_19_1605 . [ii] Katya Golubkova, “EU’s Michel Calls for ‘Stable and Constructive’ Cooperation with China,” Reuters, May 18, 2023, https://www.reuters.com/world/eus-michel-calls-stable-constructive-cooperation-with-china-2023-05-19. [iii] Nicolas Camut, “China Lashes Out at Von Der Leyen over Fiery Remarks,” Politico , March 31, 2023, https://www.politico.eu/article/china-eu-ursula-von-der-leyen-remark-fu-cong-wang-lutong. [iv] European Parliament, “The Human Rights Situation in Xinjiang, Including the Xinjiang Police Files,” June 9, 2022, https://www.europarl.europa.eu/doceo/document/TA-9-2022-0237_EN.html . [v] European Parliament, “The Abduction of Tibetan Children and Forced Assimilation Practices Through Chinese Boarding Schools in Tibet,” December 14, 2023, https://www.europarl.europa.eu/doceo/document/TA-9-2023-0479_EN.html . [vi] European Parliament, “The New Security Law in Hong Kong and the Cases of Andy Li and Joseph John,” April 25, 2024, https://www.europarl.europa.eu/doceo/document/TA-9-2024-0371_EN.html . [vii] Clea Caulcutt et al., “The Warm Embrace and the Cold Shoulder: China Mines Europe’s Fractures During Joint Visit,” Politico , April 6, 2023, https://www.politico.eu/article/china-divide-rule-eu-france-unity-ursula-von-der-leyen-emmanuel-macron-xi-jinping. [viii] Andrew Hayley. “China Defies Sanctions to Make Russia Its Biggest Oil Supplier in 2023,” Reuters, January 21, 2024, https://www.reuters.com/business/energy/china-defies-sanctions-make-russia-its-biggest-oil-supplier-2023-2024-01-20. [ix] Reuters, “Russia’s Gazprom Breaks Daily Record for Gas Supply to China,” January 3, 2024, https://www.reuters.com/business/energy/russias-gazprom-breaks-daily-record-gas-supply-china-2024-01-03. [x] To provide just a few examples: An April 2024 report by Financial Times indicates that “China supplied 90 percent of microchips imported by Russia in 2023, and that these microchips were in tanks, missiles, and aircraft.” See Demetri Sevastopulo, Guy Chazan, and Sam Jones, “US Says China Is Supplying Missile and Drone Engines to Russia,” Financial Times , April 13, 2024, https://www.ft.com/content/ecd934b6-8a91-4b78-a360-9111f771f9b1 . In December 2023, the US Department of Treasury sanctioned a network of individuals and organizations, most prominently Hu Xiaoxun and his company, Jarvis, which coordinated “[sales] of Chinese-manufactured weapons and technologies to Russia. Hu’s network has worked to structure deals circumventing United States sanctions and Chinese controls on the export of military-related materials, including for conventional weapons and electronic components with Russian customers ranging from thousands of dollars for ammunition, to hundreds of thousands of dollars for loitering munitions, to millions of dollars for semiconductor microchip manufacturing equipment . Hu and his associates . . . attempted to mask the identities of his customers by obfuscating the end-user of PRC-manufactured products.” See US Department of the Treasury, “Treasury Imposes Sanctions on More Than 150 Individuals and Entities Supplying Russia’s Military-Industrial Base,” press release, December 12, 2023, https://home.treasury.gov/news/press-releases/jy1978 . Likewise, the EU has sanctioned Chinese entities involved in sales of European electronic components to Russia. See Julia Payne, Andrew Gray, and Gabriela Baczynska, “EU Approves New Sanctions Package Against Russia,” Reuters, February 21, 2024, https://www.reuters.com/world/europe/eu-approves-13th-sanctions-package-against-russia-eu-sources-2024-02-21 . Russia has also purchased hundreds of Chinese-made military vehicles, including armored trucks. See James T. Areddy and Austin Ramzy, “Chinese-Built Armored Trucks Make Appearance in Chechnya,” Wall Street Journal , June 9, 2023, https://www.wsj.com/articles/chinese-built-armored-trucks-make-appearance-in-chechnya-33af6e4a .