Serbian Ambassador to China Milan Bacevic talks to the Global Times reporter at the Serbian Embassy in Beijing. Photo: Liu Caiyu/GT

From the recent privatization of steel plant Smederevo to the Budapest-Belgrade Railway project, China has an increasing economic presence in Serbia. While paving their way to join the European Union family, the Balkan country has opened its arms to China.

In an exclusive interview with the Global Times, Serbian Ambassador to China Milan Bacevic says his country is clearing the way for further Chinese investment, adding that European integration compliments the development of  deep bilateral ties with China.

Bacevic said economic relations between the two countries will enter into a "new phase" following a recent visit by Chinese President Xi Jinping to Serbia, which "will be based not only on big infrastructure projects, but also on Chinese direct investments, according to the principles of the market economy."

Regarding China as major player in Serbia, Bacevic noted that many Chinese companies have been playing a very active role in major infrastructure projects in his country, financed by favorable loans offered by Chinese financial institutions. 

The Mihajlo Pupin Bridge, which was China's first major infrastructure construction project on the European continent with an investment of 170 million euros ($190 million), became the second bridge over the Danube River in Belgrade when it was completed in July 2014.

The construction of the E-763 highway and renovation of the Kostolac power plant also saw Chinese involvement.

Potential projects

In early July, the Belgrade's Smederevo steel pant, which was founded in 1913, was officially taken over by the Chinese firm Hesteel for a total of 46 million euros ($51.2 million). The mill was facing closure after US Steel withdrew from Serbia in 2012.

Hesteel plans to invest about 300 million euros in the plant in total and raise its steel production to 1.76 million tons over the next one to two years. Serbian Prime Minister Aleksandar Vucic said the privatization of the plant could double the national GDP growth figure from the 1.75 percent forecast for this year to 3.5-4 percent next year.

"We expect that the successful development of this project will attract more Chinese investors and companies to our region," the Serbian envoy noted, bringing up potential projects that are open for investment, including a new industrial park in Smederevo, a port on the Danube in Pancevo, the privatization of  RTB Bor (one of the largest copper mines and smelting complexes in Europe), the construction of waste water treatment facilities in Belgrade and the construction of a waste to energy power plant.

"The process of privatization of the big state-owned enterprises in Serbia is continuing and we encourage Chinese companies to take part in it," he said.

B&R initiative

Located in southeast Europe's Balkan Peninsula, Serbia has been seen as a gateway to Eastern Europe in the One Belt, One Road initiative especially given Chinese ownership of the Port of Piraeus in Athens and the Belgrade-Budapest railway line.

Speaking of the benefits of the initiative, Bacevic told the Global Times that Serbia acknowledges the potential for the construction of  road, railway and inland waterway infrastructure that links the 21 Century Maritime Silk Road with Central Europe by land and sea.

Bacevic pointed out that regional projects jointly put forward by Serbia, Macedonia and Greece - including the Danube-Morava-Vardar-Thessaloniki water corridor - will connect the network of European waterways with Greek ports on the Aegean Sea and be of strategic importance for the development of the whole region.

"The One Belt, One Road initiative is highly beneficial for the development of the future Chinese-European relations," he added.