China commits $10.5 bn for business in ex-communist Europe

Chinese Premier Wen Jiabao on Thursday unveiled a total of $10.5 billion dollars in credit lines and funds aimed at boosting business with the blossoming economies of central and eastern Europe.

On his first visit to Poland in a quarter century, Premier Wen announced a $10 billion (7.57 billion euros) special credit line to support joint projects in the ex-communist region.

The Chinese leader, who is winding up a four-nation European tour after earlier stops in Iceland, Germany and Sweden, also announced plans for a $500 million start-up fund backing Chinese business ventures in central and eastern Europe.

The new strategy suggests a major departure from the modest $821 million China sank into the region between 2004-10, according to recent data by the Central & Eastern Europe Development Institute (CEED).

Analysts insist the cash-rich Chinese are keen to capitalise on the region's stability, growth and competitive prices to gain "perfect access to the West European market" -- still Beijing's top export destination.

"Its very good news for the region given that Chinese political statements are more than likely to be backed with action and resources from Chinese firms," Warsaw-based analyst Witold Orlowski told AFP.

Orlowski, who works for consultancy PricewaterhouseCoopers, said that a "significant economic boost" could be in store.

Premier Wen himself said China and Central and East European countries have entered "a promising spring season with important opportunities to rapidly grow our friendly relations".

"As we work hard to cultivate the seeds we have sowed, we will certainly reap a bumper harvest," he said.

Wen announced the major cash injection alongside host Polish Prime Minister Donald Tusk at a major trade forum for three hundred Chinese firms and 450 companies from across the region.

The Chinese leader also said Beijing wanted to see significant expansion in bilateral trade with central and eastern Europe over the next three years.

Pointing out China's two-way trade with central and eastern Europe "rose from only $4.3 billion in 2001 to $52.9 billion in 2011, growing at an average annual rate of 27.6 percent," Wen said Beijing now wanted to see bilateral trade reach $100 billion by 2015.

Wen later met with 15 senior leaders from the across the region for multi-lateral talks focused on developing China's political ties.

Leaders from Albania, Bulgaria, Bosnia and Herzegovina, Croatia, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Macedonia, Montenegro, Romania, Serbia, Slovakia, Slovenia and host Poland were present.

Two dozen free-Tibet protesters and supporters of China's outlawed Falun Gong group meanwhile rallied Thursday both in front of the trade forum held at a central Warsaw hotel and outside the city's royal palace.

Wen on Wednesday said human rights and the rule of law were on Beijing's radar.

China was "striving not only for economic development, but also for the construction of the rule of law and human rights," the premier said.


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