Month: October 2021

Chinese Foreign Minister Wang Yi made stops in Belgrade, Serbia, and Tirana, Albania, this week, seeking to further the Chinese government’s “17+1” effort to promote trade and investment between Beijing and the countries of Eastern and Central Europe.

While Wang was received cordially in both countries, Serbia and Albania have taken somewhat different approaches to economic cooperation with Beijing through China’s Belt and Road initiative, which has funded infrastructure projects throughout the developing world.

A stop in Greece on Wednesday and a scheduled stop in Italy on Saturday served as bookends to Wang’s visit to the Balkans. The trip is widely seen as China’s attempt to shore up economic ties in the region, which has traditionally looked more toward the European Union for development assistance.

Friendship ‘made of steel’

In Serbia, officials presented Wang with a building permit for a stretch of railway from Novi Sad to Subotica, part of a larger project to modernize the railroad between Belgrade and Budapest, Hungary. The move reflects Serbia’s relative openness to Chinese investment in the country.

Serbian President Aleksandar Vučić reiterated that Belgrade supports the “one China” policy, which considers Taiwan part of China. Wang, in turn, said Beijing respects the territorial integrity of Serbia, a signal that Beijing will continue to refuse to recognize the independence of Kosovo, which declared independence from Serbia in 2008.

Wang said the friendship between the two countries was “made of steel” and added, “Serbia is a country that has its own principles and that Beijing is proud to have such a friend.”

Vučić said that Serbia and China are implementing joint projects worth 8 billion euros ($9.3 billion) and trade between the two countries has tripled.

Large Chinese presence

According to Bojan Stanić, the assistant director for analytics at the Serbian Chamber of Commerce and Industry, in addition to 1.5 billion euros ($1.73 billion) in direct foreign investment from China in the past five years, more than 20,000 people in Serbia work in Chinese-owned companies. Additionally, more than half of the suppliers of the Smederevo Ironworks, which is owned by the Chinese HBIS Group, a Chinese state-owned enterprise, are Serbian companies.

Serbia and China have had a strategic partnership agreement since 2009 and a comprehensive strategic partnership agreement since 2016. The latter involves more high-level meetings between both country’s officials, and more extensive personnel exchanges. China is the dominant lender for road construction in Serbia. Beijing is also the owner of the Bor mining complex and the Linglong tire factory, which is under construction.

Extensive Chinese ownership of businesses in Serbia has raised concerns about compliance with environmental protection and working condition regulations in factories.

Relationship unclear

Other concerns arise from the difficulty in understanding the relationship between Chinese firms and the Chinese Communist Party’s security services.

Igor Novaković, research director at the Center for International and Security Affairs Centre – ISAC Fund, said it is not always clear where a company’s commercial interest ends and the CCP’s political interests begin.

“I do not claim that companies operating in Serbia are dangerous in themselves, but when there is a connection between politics and business, then there is a danger of using business decisions in favor of the political interests of the country from which investments come,” Novaković said.

Belgrade visit

Wang traveled from Belgrade to Tirana Thursday, ahead of Friday’s meetings with Albanian President Ilir Meta, Prime Minister Edi Rama, and Minister of Europe and Foreign Affairs Olta Xhaçka.

In Belgrade, officials have historically been much more cautious with regard to Chinese investment and lending.

“The truth is that serious doubts have actually been raised about Chinese funding following the experiences in some African countries and in the Balkans as the time comes for debt refinancing, that is, debt repayment and liabilities that have placed the governments of these countries in great financial difficulties,” said Selami Xhepa, an economist and a member of the Assembly of the Republic of Albania.

“This has required some kind of renegotiation, or similar diplomacy, with the Chinese authorities,” he added. “I think market discipline is better than diplomatic negotiations.”

UN Security Council

Last year, Albania joined a group of nations, headed by the United States, that has shut out Chinese firms Huawei and ZTE from providing equipment essential to the rollout of 5G wireless service in the country.

Nevertheless, with Albania about to take a seat on the United Nations Security Council, of which China is a permanent member, experts saw Wang’s visit to the country as an important opportunity to cement ties between the two countries and open dialogue about issues important to Albania. Among those issues is China’s continued effort to block the recognition of Kosovo as an independent country, which Albania supports.

“China is a permanent member of the U.N. Security Council and it is necessary to talk about Kosovo, about Kosovo’s accession to the United Nations, where China is a very big obstacle,” said Besnik Mustafaj, a former foreign minister of Albania who now serves as president of the Council of Albanian Ambassadors. “It is time to say that there is no parallelism between Kosovo and Taiwan, that Albania recognizes only one China.”

Ilirian Agolli of VOA’s Albanian Service and VOA’s Serbian Service contributed to this report.
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The United States and European Union are expected this weekend to announce a deal to resolve a dispute over U.S. steel and aluminum tariffs imposed in 2018 by former President Donald Trump, easing a major transatlantic trade irritant, six people familiar with the agreement said.

Three of the sources said the agreement, details of which were still being finalized, would allow EU countries to export duty free some 3.3 million tons of steel annually to the United States under a tariff-rate quota system.

“An agreement on steel has been reached and will be announced soon,” said one source familiar with the matter, speaking on condition of anonymity.

U.S. President Joe Biden has sought to mend fences with European allies following Trump’s presidency to more broadly confront China’s state-driven economic practices that led to Beijing building massive excess steelmaking capacity that has flooded global markets.

Italian Prime Minister Mario Draghi raised the need to resolve trade issues during a meeting Friday with Biden as a G-20 leaders summit got underway in Rome, a source familiar with the meeting said.

The deal may ease record-high U.S. steel prices that have topped $1,900 a ton as the industry has struggled to keep up with a demand surge after COVID-19 pandemic-related shutdowns. This has contributed to rising price inflation for manufactured products in the United States including cars.

Steel volumes above the 3.3-million-ton quota would be subject to tariffs, but additional duty free-status would be extended for about 1 million tons of EU steel products that had previously won Commerce Department tariff exclusions, three sources said.

The agreement leaves intact Trump’s global tariffs of 25% on steel and 10% on aluminum but on a practical basis exempts a substantial portion of Europe’s steel exports to the United States.

Europe exported about 5 million tons of steel annually to the United States prior to Trump’s imposition of the “Section 232” tariffs in March 2018 on national security grounds.

The Commerce Department, U.S. Trade Representative’s office and White House did not immediately respond to requests for comment.

U.S. Trade Representative Katherine Tai is scheduled to address American steel industry executives Tuesday in Washington. The industry and the United Steelworkers union have been pressing Biden’s administration to maintain the steel tariffs to protect a resurgence in new investment since 2018.

Industry officials also have said they were pushing for a requirement that any EU steel imported duty free be melted and poured in the trade bloc, a provision aimed at keeping Chinese steel from being minimally processed in Europe and exported to the United States.

The metals deal would allow officials about a month to implement it before a late-November deadline for a doubling of EU retaliatory tariffs on certain U.S. products, including motorcycles and whiskey.

Details were not immediately available on terms of the aluminum portion of the deal. An industry source said a resolution is expected to be included as part of an overall metals dispute agreement.

The United States allows imports of steel duty-from North American trade deal partners Mexico and Canada, with a mechanism that allows tariffs to be reimposed in the event of an unexpected “surge” in import volumes.
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Angela Merkel has completed her final trip as German chancellor to Greece, a country where she was not overly welcome in the past because of the strict austerity measures she backed to keep Greece’s economy afloat.

Sticks, stones, gas bombs and heated demonstrations gripped Greece on Merkel’s first visit to Athens in 2012.

But now, a decade later, the outgoing chancellor got an almost indifferent public reception, walking freely along streets bare of any public protest or threat for the European politician many people here had dubbed an enemy.

Resentment, though, was obvious, and President Katerina Sakellaropoulou tapped into the nation’s mood, bidding Merkel farewell with criticism of the austerity policies she advocated for Greece, recalling the tough times the two countries faced during Greek financial crisis. 

There were times of difficulty and tension, she told Merkel with a stern face. Greeks had to pay a heavy price. And, Sakellaropoulou said, there were many times when Greece, as a European nation, felt alone.

The decade-long financial crisis saw a quarter of the country’s economy wiped out and 1.2 million Greeks losing their jobs. 

Many Greeks expected Merkel to return to the country with an apology for the bitter policies she supported because Germany was the single largest contributor to a bailout scheme that helped keep the Greek economy from crashing.

She instead came with a strong dose of self-criticism.

“I knew that I was asking a lot of the people in Greece, Merkel said. But she cited the role that previous leftist governments played in making the implementation of those policies more difficult, adding to social upheaval at the time,” Merkel said.

The remarks scored few points with Greeks. 

Political analyst Panayiotis Lampsias explains the nation’s reaction to Merkel.

Of course, she played a pivotal role in keeping Greece in the EU, and that should not be underestimated, he said. But this self-criticism comes too late, and now years later and on her way out, Lampsias added, Merkel has the luxury of being able to make such remarks.

In Greece’s post-crisis era, Prime Minister Kyriakos Mitsotakis reassured Merkel that the country would stick to fiscal discipline but not what he called, “blind austerity.”

Greece, he said, is no longer a source of crisis but a modern European state striving for a better future within the European Union.

Merkel’s vice chancellor, finance minister and likely successor Olaf Scholz accompanied her on the visit to Athens. He refrained from making any comment or offering any thoughts on whether Germany would ease up on its fiscal requirements, a concern nagging Greeks as Merkel departs the chancellorship.
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U.S. President Joe Biden will hold talks with European leaders over the Iran nuclear program Saturday afternoon, Rome time, on the sidelines of the G-20 summit in Italy, following Tehran’s announcement earlier this week that it is ready to resume negotiations before the end of November. 

Biden, British Prime Minister Boris Johnson, French President Emmanuel Macron, and German Chancellor Angela Merkel will seek an agreement on the path to resume negotiations for a return to the 2015 Joint Comprehensive Plan of Action, also known as the Iran nuclear agreement. The so-called E3+1 format will focus on “shared concerns about the state of Iran’s nuclear program,” the White House said.

Former U.S. President Donald Trump withdrew the U.S. from the JCPOA deal in 2018. Biden has said the United States will rejoin once Tehran returns to full compliance with the agreement’s restrictions on nuclear weapons development.

The Saturday talks will be a “study in contrast with the previous administration, since Iran was one of the areas of most profound divergence between the previous administration and the Europeans,” national security adviser Jake Sullivan told reporters aboard Air Force One en route to Rome Thursday.

“Here you’ll see Chancellor Merkel, President Macron, Prime Minister Johnson, and President Biden all singing from the same song sheet on this issue,” he said.

However, in his first in-person meeting with these NATO allies, Biden will also have to placate lingering resentment over the chaotic August U.S. withdrawal from Afghanistan, which left them scrambling to get their troops and citizens out as the Taliban took over Kabul. Analysts say the allies are likely to press Biden for firm commitments of better coordination on Iran, which they did not believe was given on Afghanistan.

On Wednesday U.S. Secretary of State Antony Blinken said he had ordered a full-scale review of the Afghan withdrawal. VOA asked Principal Deputy Press Secretary Karine Jean-Pierre aboard Air Force One en route to Rome, Thursday, whether the announcement Afghanistan review was timed ahead of Biden’s G-20 trip. 

“I wouldn’t connect the two,” she said. “I don’t have much more to share about that.”  

Fresh sanctions

On Friday, ahead of the G-20, the U.S. Treasury Department announced new sanctions against two senior members of Iran’s Revolutionary Guard Corps and two affiliated companies for supplying lethal drones and related material to insurgent groups in Iraq, Lebanon, Yemen and Ethiopia.

With these sanctions Biden is signaling that his administration still has leverage and tools to pressure Tehran, said Sanam Vakil, deputy head of the Middle East and North Africa Program at Chatham House.

“Iran’s sponsorship of regional instability continues to be on Biden’s radar,” she said. 

Iran swiftly called the penalties “completely contradictory behavior.”

“A government that talks about an intention of returning to the nuclear deal but continues Trump’s policy of sanctions is sending the message that it really is not reliable,” Iran’s Foreign Ministry spokesman Saeed Khatibzadeh said in remarks published on the ministry’s website.

“Iran is upset but its options to hit back are limited,” said Alex Vatanka, director of the Iran program at the Middle East Institute, who predicts that the sanctions will not stop Iran from returning to the negotiation table.

“It can refuse to return to the talks in Vienna but then it will increase the chances that Washington can better mobilize the international opinion against Iran as the main spoiler that is preventing a breakthrough in the nuclear talks.”

Analysts say Tehran is trying to avoid a scenario where the U.S. and Europe convince Russia and China that Iran’s nuclear program is too close to possible weaponization.  

“It’s likely Iran will return in part because Europeans – whom Iran sees as weaker than U.S. – and Russia with whom Iran does various deals, want Iran back,” said James Jeffrey, chair of the Wilson Center’s Middle East Program.

Plan B

The United States and Israel have warned that they are exploring a Plan B if Tehran does not return in good faith to salvage JCPOA.

“Time is running short,” Blinken said at a joint press conference with Israeli Foreign Minister Yair Lapid in Washington earlier this month. “We are prepared to turn to other options if Iran doesn’t change course, and these consultations with our allies and partners are part of it.”

However, analysts say the Biden administration is unlikely to use military options nor would it greenlight the Israelis to strike. Jeffrey said the U.S. is more likely to rely on a combination of new sanctions and tougher position on Iran’s aggression in the region, alongside strategic ambiguity on military response should the talks fail.

While the Iranians do not think the Biden team has a serious military Plan B, Tehran cannot allow the nuclear stalemate to go on forever, Vatanka said. 

“One way or another, both sides – the US and Iran – need to put the brakes on this cycle of escalation,” he said.

VOA’ Anita Powell contributed to this report.
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U.S. President Joe Biden met with Pope Francis at the Vatican on Friday, ahead of his meeting with G-20 leaders. Biden said the pope supported his receiving Holy Communion, while some U.S. bishops want to deny him the sacrament over his stance on abortion. With Anita Powell contributing, White House Bureau Chief Patsy Widakuswara has this report from Rome.
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U.S. President Joe Biden launched his whirlwind European diplomatic tour on a conciliatory note, saying Friday that the rollout of a security deal between the United States, Britain and Australia that cut out longtime ally France was “clumsy.”

“What happened was, to use an English phrase – what we did was clumsy,” Biden said. “It was not done with a lot of grace,” he acknowledged, next to French President Emanuel Macron in Rome ahead of the G-20 summit. The two spoke to reporters following their meeting which was notably held at Villa Bonaparte, the French Embassy to the Vatican, instead of a neutral venue.

The Indo-Pacific AUKUS security deal provides Australia with U.S. nuclear-powered submarines.  But buying U.S. subs meant Canberra cancelled the $65 billion deal it previously made with Paris for traditional submarines.

The diplomatic fallout was swift: Paris temporarily recalled its ambassadors from Washington and Canberra, saying they were not consulted in advance of the AUKUS deal.

“I was under the impression that France had been informed long before that the deal was not coming through,” Biden said Friday. “Honest to God, I did not know that you had not been.”

This modest concession matters, said Leslie Vinjamuri, director of the U.S. and the Americas program at Chatham House. 

“It’s pretty clear that both Biden and Macron have a lot to lose and wish this relationship to work,” she said. “So, they are finding ways to signal that, including in this case an acknowledgment that stops short of an apology.”

Biden earlier committed to supporting France in their counterterrorism effort in the Sahel, where instability triggers waves of African migrants to aim for Europe.

“Clearly the U.S. made a tough call on how to deal with France in the run-up to this decision and, ultimately, the AUKUS partnership stands and France is outside of it,” Vinjamuri said.

Other key meetings 

Earlier Friday, Biden met with Italian Prime Minister Mario Draghi, a potential key ally in transatlantic relations at a time when German Chancellor Angela Merkel is set to leave office and Macron remains politically embattled at home.

They and other leaders will gather at the G-20 summit of the world’s wealthiest nations, hosted this year by Italy, which begins Saturday.

“Italy really is an anchor in southeastern Europe for the United States,” said Rachel Ellehuus, deputy director and senior fellow with the Europe, Russia, and Eurasia Program at the Center for Strategic and International Studies. 

The White House said Biden thanked Draghi for Italy’s support following the U.S. withdrawal from Afghanistan, including by temporarily housing more than 4,000 Afghans who were on route to the U.S. in August. The leaders discussed challenges to security in the Mediterranean region and reaffirmed the importance of NATO’s efforts to deter and defend against threats.

Biden is also expected to meet Turkish President Recep Tayyip Erdoğan on the summit’s sidelines. Erdogan recently threatened to expel the U.S. and nine other Western ambassadors over their support of a jailed Turkish philanthropist over charges of espionage, terrorism and attempts to overthrow the government – allegations that Western observers have called absurd.

“This meeting is important for President Biden to send some messages to Turkey about what is and is not acceptable behavior from a NATO ally, what his expectations are for Turkey being a partner in everything from follow-on security challenges from Afghanistan to Turkey’s role in the Black Sea region and Turkey’s performance in NATO,” Ellehuus said.

Observers, journalists and international partners have repeatedly asked when Biden will meet one-on-one with the leader of the country the U.S. considers its main adversary: China. But Chinese President Xi Jinping will not attend the G-20 summit in person, nor the climate conference that will follow immediately after, in Glasgow. 

The White House has confirmed Biden and Xi will meet virtually before the year’s end.
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Pope Francis issued an urgent appeal Friday to world leaders ahead of the U.N. climate conference to take “radical decisions” to protect the environment and prioritize the common good rather than nationalistic interests.

Francis delivered the “Thought for the Day” on the British Broadcasting Corp.’s morning radio program ahead of the Oct. 31-Nov. 13 climate conference in Glasgow, Scotland.

In the message, Francis urged political leaders not to waste the opportunity created by the upheaval of the COVID-19 pandemic to change course and chart a future based on a sense of shared responsibility for a common destiny.

“It means giving priority to the common good, and it calls for a change in perspective, a new outlook, in which the dignity of every human being, now and in the future, will guide our ways of thinking and acting,” Francis said. “The most important lesson we can take from these crises is our need to build together, so that there will no longer be any borders, barriers or political walls for us to hide behind.”

Francis has made caring for God’s Creation one of the hallmarks of his papacy. In 2015, ahead of the last U.N. climate conference in Paris, he penned the first-ever ecological encyclical, “Praised Be,” in which he denounced how the “perverse” profit-at-all-costs global economic model had exploited the poorest, ravaged Earth’s natural resources and turned the planet into an “immense pile of filth.”
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