China – European Strategist | Evropský stratég

China’s peaceful rise and the good neighbor policy

Published on 11th December 2011

International Affairs / Mezinárodní dění

‘China’s road of peaceful development is a brand-new one for mankind in pursuit of civilization and progress, the inevitable way for China to achieve modernization, and a serious choice and solemn promise made by the Chinese government and the Chinese people.’

Peaceful development is the inevitable way for China’s modernization. With these incisive and forceful words, China’s State Council Information Office opened China’s Peaceful Development Road (the white paper has been published on December 2005) and Beijing government inaugurated the new foreign policy strategy.

With Chinese economic miracle, quick and fast-paced industrial development and high annual growth rates of above 9%, Beijing has not only consolidated the strategic cooperation with its Asian neighbors, but also has increased its economic influence on the regional geopolitical chessboard.

The string of Chinese investments and trade agreements with its neighbors have fostered a relationship of economic interdependence with Beijing, which increases in the international community, especially for competitors like U.S. and Russia, suspicions and fear of an imminent ‘Chinese threat’ to dominate and control Asian region and its resources.

First, the Bush administration and now the Obama administration informally adopted a policy of containment of Beijing economic and political influence in Asia to counterbalance this “Chinese threat” and to regain the most important role in Far East. The official statements of U.S. State Secretary, Hillary Clinton, at the 17th ministerial meeting of the ASEAN Regional Forum in July 2010, (‘the United States, like every other nation, has a national interest in freedom of navigation, open access to Asia’s maritime commons, and respect for international law in the South China Sea‘) and Obama’s recent announcement of the achievement of the broad outlines of the Trans-Pacific Partnership (TPP) agreement with eight Asian Countries are strong signals of this containment policy.

Beijing’s response to ‘Chinese threat’ perception

In response to ‘Chinese threat’ external ‘misperception’, Beijing government and a Chinese scholar devised a new perspective of thinking, which aims to build a new image of a reliable and credible China, as a responsible stakeholder in the international system.

The cornerstone of this new China’s foreign policy strategy is the adoption of the ‘peaceful development’ ideological doctrine, heping fazhan, for a ‘peaceful rise’, heping jueqi, in a harmonious and multipolar world governed by order and prosperity, where there is no room for a single hegemony. The rhetoric of government seeks to subvert the external perception, maybe a misperception, of the country as a ‘threat’ to the interests of major global powers. This concept, core of China’s new strategic doctrine, has been proposed first by the scholar Yan Xuetong in 1998 and used officially re-introduced by the Chairman of China Reform Forum, Zheng Bijian, during the Bo’ao Forum in 2003.

Since 2003, Beijing began on one side to concentrate the efforts on the dimension of public diplomacy, bound by the multilateral coordination, and also to pursue a peaceful rise, without seeking hegemony. Wen Jiabao stressed once again that China’s goal is not to obtain absolute control nor create a deadlock conflict with the United States or Russia, but rather to build good neighborly relations and strengthen the partnership with neighboring countries.

In fact, Beijing needs to strengthen collaborative and non-confrontational relationships, to neutralize the risk of an unexpected growth-braking. In the speeches of Hu Jintao and Wen Jiabao the ‘heping jueqi’ is described as the focal point for the development of the Country:

Peace, opening-up, cooperation, harmony and win-win are our policy, our idea, our principle and our pursuit. To take the road of peaceful development is to unify domestic development with opening to the outside world, linking the development of China with that of the rest of the world, and combining the fundamental interests of the Chinese people with the common interests of all peoples throughout the world. China persists in its pursuit of harmony and development internally while pursuing peace and development externally; the two aspects, closely linked and organically united, are an integrated whole, and will help to build a harmonious world of sustained peace and common prosperity.

China’s new diplomatic approach: periphery policy and good neighbor policy

With the end of the Cold War, the collapse of the Soviet Union and the opening of China to international markets, a new type of political culture is born in Beijing. In the wake of Deng Xiaoping’s mission of modernization, China inaugurates its pragmatic strategic behavior: tao guang yang hui, you suo zuo wei, ‘keep a low profile and never take the lead’.

For its own interests, Beijing works to promote a multipolar community, duojihua, where both cooperative and friendly relations with neighbors and principles of national sovereignty and non-interference in internal state affairs, can preserve regional stability. The “good-neighbor” integrated regional policy is the China’s new diplomatic approach. Before the 1980s China was not able to create a good network of relations with its neighbor countries nor to make an integrated regional policy or to promote economic cooperation.

But with the open door policy and the end of international isolation, Chinese leaders offer a new perspective of development related to a new ideology: zhoubian zhengce, an integrated ‘periphery-policy’, known as the ‘good neighbor policy’, mulin zhengce. Establishing good relations with neighbors, China can convert its image as a responsible power willing to promote stability, security and regional cooperation, increasing its influence in world affairs, soft power and moral authority.

The key-points of this strategy seem to be: the multilateral diplomacy with the normalization of the relations with several Southeast and Pacific-Asian countries; the emphasis on the emergence of a ‘new Asianism’; the participation in Asian regional organizations (first of all the ASEAN + 3 and the SCO) and the activism within the most important international institutions.

During last ASEAN Summit, held recently in Indonesia, Premier Wen Jiabao has highlighted how China intends to strengthen good-neighbor policy in maintaining the status quo equilibrium in the region:

We are committed to a policy of building good-neighborly relations and partnership with our neighboring countries, and we abide by the Treaty of Amity and Cooperation in Southeast Asia. The disputes over the South China Sea between the relevant countries in the region have existed for many years. They should be settled through friendly consultation and negotiation between the sovereign states directly concerned.

The desire to consolidate the diplomatic and economic relations with Old Europe and U.S. reflects Beijing’s goal to put itself forward as the great debt crisis solver and as guardian of equilibrium in a new peaceful international order. In the words of the ideologist Zheng Bijian:

China’s cultural tradition, featuring ‘unity in diversity’ and ‘priority to peace,’ also goes a long way toward facilitating China’s harmonious coexistence and sharing of prosperity with the Asia-Pacific region and the world at large.

Conclusion

China chooses the road to peaceful development to strengthen its soft power and its international influence, but this strategy serves not only to Beijing for its economic development or for its regional affairs, but also to increase its political and diplomatic weight.

Indeed, the construction of a peaceful world, orientated to maintaining the status quo relationship with Taiwan, the economic interdependence and the participation in Asian Regional Fora keep off the risks of possible military confrontations in the South China Sea and neutralize U.S. influence in the area.

Few days ago, President Hu Jintao alerted military personnel to ‘make extended preparations for warfare‘ in South China Sea. Hu Jintao’s statement has provoked strong reactions and more than one question: is China’s rise really peaceful? How can China’s rearmament and the increasing in military spending be consistent with Beijing’s good neighborly strategy? A war in South China Sea would be a war for the assertion of hegemony, but it is improbable that China intends to address a military dispute in this time of global crisis. Hu Jintao’s call seems only a demonstrative test of the military strength of an ambitious rising power.

We can thus say that if China’s rise was first a big problem for the interests of the West, now the real “China’s threat” is its peaceful rise, that allows Beijing to build new relations of good neighborliness, to exercise more political influence and to regain international credibility.

Bibliography:

Suisheng Zhao, China-U.S. relations transformed: perspectives and strategic interactions, Routledge 2008.

C. Fred Bergsten,Charles Freeman,Nicholas R. Lardy,Derek J. Mitchell, China’s Rise: Challenges and Opportunities, Center for strategic and international studies 2008.

Sujian Guo, Challenges and Opportunities for China’s “Peaceful Rise”, in: http://bss.sfsu.edu/sguo/My%20articles/006%20Introduction.pdf.

Zheng Bijian, China’s Peaceful Rise: Speeches of Zheng Bijian 1997-2004, in: http://www.brookings.edu/fp/events/20050616bijianlunch.pdf.

Putin’s Eurasian Union: A danger or strategic opportunity?

Published on 25th November 2011

International Affairs / Mezinárodní dění

When Vladimir Putin recently published an article in the Russian daily Izvestia that officially announced his plans for the establishment of an Eurasian Union in the geographical space of former USSR countries, he caused quite an uproar in the Western media.¹ The headlines such as those in the Telegraph run that Putin’s wish is nothing short of re-forming ‘a pseudo-Soviet Union’ reassuring readers that the plan is about ‘reclaiming the Russian Empire’,² even though in the same article Putin explicitly rejected any comparison with the USSR. Newspaper commentaries are naturally inclined to exaggeration and the use of catchy words to raise readership figures, but they still reflect general fears of the West towards the resurgent Russian foreign policy of the last decade. The essential policy question for the EU and US is whether these concerns about a Eurasian union are justified and reflect a real threat of some ‘incoming Russian empire’. Or perhaps, if considered from a different angle, the Putin’s and Russian administration’s plans might just as well present the NATO allies with a real strategic opportunity.

A short notice to readers about my argument’s presuppositions is first due, however. In the grand realm of foreign policy, one can speak about natural allies and interests only with a grain of salt. If the cultural and value-based factors remain excluded, economics, energy, nor even geography can offer clear-cut answers on choosing a country’s allies and by extension, also its enemies. To say that Russian foreign policy now poses a threat or strategic opportunity then implies taking a particular normative stand, which is in turn arguable based on the principles adopted. In this short piece, my purpose is singular: to contrast the arguments of those on the side of the EU and US who claim that the Russian initiatives in the Eurasian basin should be opposed with those less numerous voices to which I also humbly join, who argue that Putin’s ‘Eurasian Union’ is a sound initiative of regional integration that can serve the EU’s and US’s interests in stabilising the whole region thus creating a strong ally to balance out other rising superpowers such as China.

Flags of the three present members of the Customs Union — Belarus, Kazakhstan and Russia already form a Customs' Union, Eurasian Union will be its successor

The critics of the Russian foreign policy generally argue that Russia under Putin and Medvedev is simply rebuilding its former empire, sometimes using its leverage in energy resources, sometimes outright military aggression as in case of Georgia. In their interpretation, such efforts must be vigorously opposed, as the result will be nothing but Russia’s domination of its ‘Near Abroad’ that will prevent countries such as Ukraine and Georgia in making a free choice to join the international community of liberal democratic states. These arguments are often joined by those in the EU who believe that the Union’s foreign policy should be based on stabilising its neighbourhood through spreading of its norms, functioning as a sort of ‘a neo-medieval empire’ (Jan Zielonka) or ‘neoliberal empire’ (Warwick Armstrong and James Anderson). Naturally, approaching Russia, a country that has consciously adopted a development strategy of ‘modernisation without Westernisation’, with this approach is inherently ineffectual, as the EU as Russia’s equal ally does not have any leverage that it could impose on its eastern partner. The result is that Europe’s prominent politicians such as German FM Guido Westerwelle and his Polish counterpart Radek Sikorski, who recently addressed a joint letter to the EU’s chief of foreign affairs Catherine Ashton, where they urged her to reorient her policy towards realpolitik of securing energy supplies and modernising Russian economy.³

If the Russian leadership’s military solutions to the Georgian and 2^nd Chechnyan conflicts can regarded as controversial, Putin’s latest initiative shows that the Russian political elite clearly realises that their country’s influence on its neighbourhood can be achieved only if it brings benefits to both sides and is not based on force. Far from being a Russian empire, the Customs Union, which is to be a first step towards a full Eurasian Union, was joined by Kazakhstan and Belarus of their own sovereign decision and they will retain a proportionate control over the decision-making of the whole union. Indeed, Kyrgyzstan and Tajikistan already have submitted their own bid for the membership. Similarly, where Russia once had relied on its hard currency reserves to gain from its neighbours political concessions through cheap provision of loans and direct subsidies of fuel, the new policy aims at elevating the economic prospects of the entire region with Russia serving as a natural gravity well.⁴ While Russia will over time benefit by reinforcing its status as the region’s financial and business centre, the other countries of the Union will be more competitive in agriculture and heavy industry such as steelmaking, gain investments for their backward, Soviet-style economies (this especially applies to Belarus), just as benefit from the competitive advantage of their cheaper labour force.

For the EU and US, the Russian effort to lead a regional integration brings a possibility of an alternative form of the international ordering. Without making any positive or negative judgements, the present international order can be broadly labelled as the global military hegemony of the US with the support of its NATO allies. This hegemony has been supported by the combined economic might of the US, EU and Japan, but as the economies of indebted Western countries will be experiencing their relative decline, their military control will inevitably wane too. The obvious alternative is that this hegemony will be replaced by another – that of the Asian or Chinese century. As this is naturally an infeasible outcome for the European and American interests, maximum effort should be made to seek out other options, the most significant of which is a return to the principle of balance of power remodelled for the purposes of the ‘grand scale’ of the globalised world. While the original international order of nation-states presupposed the relative equality of countries in the still rather localised world of the 19^th century, sovereignty in the postmodern world becomes intangible but for the largest of polities that possess a broad control over the world’s natural and economic resources. Thus, political equality in the 21^st century can be achieved only on the level of ‘grand spaces’, by political groupings that are sufficiently large and powerful to maintain an effective control over their territory that would balance out that of other similar entities.

A Eurasian Union, modelled on the EU is a clear step into the direction of such a multipolar world. As its plans develop from the current Customs Union to a full economic union, it is based on fully voluntary grounds and is expected to bring benefits of peace and economic growth to all its members – not just the Russian giant. In the rapidly changing world of the 21^st century, a Eurasian Union could well become a strong ally of the EU and US and help them to ensure that their relative strength will remain preserved, even against the odds of the rising Chinese dragon.

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China-U.S. Competition to lead Asian Development

Published on 20th November 2011

International Affairs / Mezinárodní dění

A new ‘Great Game’ in Asia-Pacific arena arouses the antagonism and the rivalries between old and new world powers. The future of the United States is closely connected to and dependent on the Asian geopolitical chessboard. Therefore, last week, President Obama said in his speech to the Australian Parliament that:

Let there be no doubt: in the Asia-Pacific in the 21st century, the United States of America is all in. With most of the world’s nuclear powers and some half of humanity, Asia will largely define whether the century ahead will be marked by conflict or cooperation, needless suffering or human progress. The United States is a Pacific power, and we are here to stay.

‘We are here to stay’ is a strong message directed to the great rising power, China, the most ambitious player in the competition to gain the regional hegemony in Asia-Pacific. The Sino-US relations, oscillating between competition and cooperation, seem to have inaugurated a new course. Officially, Barack Obama emphasizes the importance of the US-China cooperation and recognizes Beijing’s balancing role in the region:

We’ve seen that China can be a partner, from reducing tensions on the Korean peninsula to preventing proliferation. We’ll seek more opportunities for cooperation with Beijing, including greater communication between our militaries to promote understanding and avoid miscalculation.

On the unofficial side, Obama’s strategic goals are glaring and China knows them: Washington aims to regain the leadership in the Far East, implicitly carrying out a policy of containment of Beijing’s political and economic influence. The United States define their role in Asia just when in the West people live out through the peak of global crisis,with Euroland looking to China, already the largest single holder of U.S. government debt, and to its 3200 billion USD foreign exchange reserves as the only resource for the rehabilitation of the public debt.

The first significant sign of U.S. interests in Asian geopolitical space is the announcement of the imminent dispatch of a military aircraft and up to 2.500 marines to Darwin in northern Australia, only 500 miles from Indonesia. The U.S. goal is to strengthen alliances with Japan, South Korea and the Philippines and protect core U.S. interests across Asia. By 2016, the number of American troops stationed in Asia will be staggering: 2500 marines stationed in Australia, 50000 already stationed in Japan and 28000 stationed in South Korea.

New Asia-Pacific order

The new chapter of the Washington’s Asian policy started at the last Asia-Pacific Economic Cooperation (APEC) Summit in Honolulu. During the APEC Forum, which brought together 21 Pacific Rim Countries, the ‘member economies’ that seek to promote free trade and economic cooperation throughout the Asia-Pacific region, President Obama has defined new conditions to Beijing government. Obama insisted that China should appreciate its official currency, the renminbi. A faster rise of its value would balance global trade and make American goods more competitive, but also it would discourage the inflow of foreign capital to China. ‘We’re going to continue to be firm that China operate by the same rules as everyone else. We don’t want them taking advantage of the United States‘, stated President Obama.

While the United States are not afraid of China’s rise, China begins to worry about Obama’s recent announcement of the achievement of the broad outlines of the Trans-Pacific Partnership (TPP) agreement, an Asia-Pacific regional trade agreement negotiated among the United States and 8 other partners (Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam). The TPP will exclude China and Russia from this free trade regional area in Asia-Pacific, with a related market of 500 million consumers.

China’s response: ASEAN + 3 is the keystone of Asian development

Beijing’s swift response arrived at the Association of South East Asian Nations (ASEAN) Summit, held recently in Bali, Indonesia. Premier Wen Jiabao has summarized in four key-points his proposal for South-East Asia’s development, highlighting how China intends to strengthen multilateral relations and participation in regional organizations in maintaining equilibrium and balance in the region.

First, we should enhance strategic consultation and mutual trust. We are committed to a policy of building good-neighborly relations and partnership with our neighboring countries, and we abide by the Treaty of Amity and Cooperation in Southeast Asia. The disputes over the South China Sea between the relevant countries in the region have existed for many years. They should be settled through friendly consultation and negotiation between the sovereign states directly concerned.

The second China’s priority is the regional economic development and a common coordination of strategies:

Second, we should pursue economic development and social progress as a top priority. Both China and ASEAN Countries are in a crucial stage of development. We should better coordinate development strategies, draw on mutual strengths and promote cooperation in more fields and at a higher level.

The third key-proposal of Wen’s speech at the Bali Summit points out that the development of cooperation in Asia should be addressed through the mechanism of ASEAN 10 +3 (China, Japan and South Korea). This is a way to strengthen the partnership with Japan and South Korea, historical allies of the United States. On the other hand, in these days the United States and Russia for the first time take part at the East Asia Summit and aim to strengthen the mechanism of ASEAN +8, to counterbalance China and ASEAN +3.

Third, we should adhere to ASEAN centrality in promoting East Asian cooperation. China supports ASEAN integration and community building and welcomes a stronger and more influential ASEAN. We are confident that ASEAN is fully capable of leading East Asian cooperation. China will open a permanent mission to ASEAN next year. We will continue to support ASEAN and work with it, and we will continue to take 10+1 as the foundation, 10+3 as the main vehicle and the East Asia Summit as an important supplement in pursuing East Asian cooperation.

In the last fourth point of his speech, Wen Jiabao said that China will seek to strengthen cooperation through multilateral approach.

Fourth, we should uphold our common Interests in the multilateral field.

Undoubtedly, the main passage of Wen’s stronger new Asian policy is summarized in this sentence: ‘China will never seek hegemony and is opposed to all hegemonic acts.‘ The reference is to the strategic and geopolitical ambitions of the United States in Asia, especially compared to the frequent interference in inter-regional disputes between China, Vietnam, the Philippines over the Spratly Islands in the South China Sea between China and Japan in Diaoyu-Senkaku in East China Sea.

South China Sea: core interests and sovereignty

The South China Sea is Beijing’s core interest, with China claiming its ‘indisputable sovereignty’ on the myriad of islands, rocks and vast natural resources, especially hydrocarbures, sited in the subsurface sea. With the Dong Feng-21 D, also called the ‘aircraft carrier killer’, a ballistic missile with range of 3000 km, and the increasing military spending, Beijing government could shift Pacific power balance. China has turned its ‘Continental Policy’ into a new “Oceans Policy”, oriented to shake the balance of powers in the maritime space through a strengthening of military outposts in the South China Sea.

This refinement of Chinese military technology has increased the concern of Japanese and Philippines, who have called upon a U.S. intervention. At the 17th ministerial meeting of the ASEAN Regional Forum in July 2010 U.S. State Secretary, Hillary Clinton stated:

The United States, like every other nation, has a national interest in freedom of navigation, open access to Asia’s maritime commons, and respect for international law in the South China Sea. We share these interests with not only ASEAN members and ASEAN Regional Forum participants but with other maritime nations and the broader international community.

Conclusions
It is difficult to make predictions on the future development of Sino-U.S. relations with regard to the effort to achieve strategic supremacy in the Asia-Pacific region. One thing is certain: participation in regional organizations seems to have become the keystone in establishing a new balance of power in Asia.

Ten awkward questions to ask Crazy Crab, cartoonist who challenges China’s Great Firewall

Published on 10th November 2011

International Affairs / Mezinárodní dění

EVERYONE is looking, but nobody knows who he is. Bloggers around the world, censors and guardians of the World Wide Web, national and foreign press. In recent weeks, there is too much talk about him, Crazy Crab, pseudonym of the first cartoonist who challenges China’s Great Firewall doing political satire. Hexie Farm is a political satire comic book and has attracted lots of attention from internet users all around the world, because it reveals the contradictions and the dark side of China’s society with one ruling Party and corrupted protagonists. Following the publication of Hexie Farm, the name of his comic, in the new list of Sina Weibo’s banned search terms and “sensitive words” (as “Tiananmen square”, “democracy” and “leadership change”), The Post Internazionale found Crazy Crab and gave him a voice through a unique and exclusive interview.

Hexie Farm is the first and most famous example of political cartoon and political satire in the history of contemporary China. Its popularity has spread beyond the Great Wall in Europe and the United States. But what does it mean to do political satire in China, today?

It’s hard to say what political satire means in China today. Public political satire is rare in China. Public critic on Chinese politics is dangerous. People might lost jobs, be detained or arrested for doing this. Due to strict censorship, it seems that most Chinese political cartoonists lose their courage to criticize. But what a harmonious time we live! Every day, hilarious news of tragicomedies pops up from the corner of GFW. What a waste it would be if we remain silent at this. Although no media in main land China dares to publish my cartoons, and the authority is trying hard to locate my cartoons and delete them, they are still got reposted to more audience.

Interview made by Maria Dolores Cabras. You can read it in full at the website of the international politics’ magazine Post Internazionale.

Ágnes Szunomár: The roots of Chinese-Central European relations – The case of Hungary

Published on 1st October 2011

International Affairs / Mezinárodní dění

The Chinese presence in Central and Eastern Europe (CEE) has intensified recently as China’s great power ambitions have grown and the CEE-region has been in dour need of this new partnership due to the economic crisis. However, this relationship is not as new-fangled as it seems. In some cases – for example the case of Hungary – it dates back several decades. Overall, Hungarian-Chinese relations are very successful. They have a six decade history, as old as the PRC itself.

Hungary formally recognized the People’s Republic of China on 4^th October 1949. During the following decade the relationship began to develop with a huge number of high-level visits followed by the improvement of economic, political and cultural ties. Although the Hungarian-Chinese relationship was basically within the Soviet sphere of interest, Hungarian foreign policy did not follow, but rather differed a bit from the policy of Moscow. In international affairs Budapest cooperated closely with Beijing and has always supported the Chinese position on Tibet, the reunification of China (one china policy) and United Nations (Security Council) membership. By the end of the 50s, deep ideological differences began to appear between the two countries and, in the wake of the 60s, – during the Chinese “cultural revolution” – the relationship became increasingly colder. Much later, with the reorientation of the Chinese Communist Party in 1978 – its economic reforms and its opening-up policy – the two countries were brought closer together again. The Chinese leadership was genuinely interested in the experiences of the Hungarian economic reform process of 1968 and, in this spirit, a series of expert delegations visited Hungary. In the 80s, state and inter-party relations were normalized and high-level delegations were also reinitiated. After the democratic transition of 1989, the level of contacts between the two countries declined again, primarily as a result of the reorientation of Hungarian foreign policy, as more attention was given to Euro-Atlantic interests. For more than a decade, the degree of contact declined to a minimum.

Another fruitful period began at the beginning of the new millennium, after the visit of the Hungarian Prime Minister, Peter Medgyessy in 2003 to Beijing. The new wave of development was initiated independently by Hungary, because the government recognized that China is an unavoidable player in the global economy and international politics and because EU membership made Hungary more attractive to China as well. But for this purpose, steps had to be taken before others would take them. In this spirit, several confidence-building measures and gestures were undertaken and the results have become almost immediately apparent in the form of economic growth indicators. Over the past decade, the Hungarian government – regardless of political orientation – has committed itself to developing its relationship with China. Hungary has good results in the field of bilateral trade and investment with China. And this has led to greater expectations: infrastructure development and the financing of Hungarian public debt are just some of the areas where Chinese involvement is expected or has already been achieved.

When asking about the reasons for choosing Hungary instead of Poland or the Czech Republic, an interesting hypothesis can be found about the relation of the Chinese population in Hungary to the success of the Chinese-Hungarian relationship. The fact is that within Central-Eastern Europe the highest Chinese population can be found in Hungary. There are now around 10 000 – 15 000 (12 653 officially) native Chinese living in Hungary. And the majority of this population arrived in the early 90s. This is one of Hungary’s biggest advantages when building economic, political and cultural relations with China. Confidence and good impressions are of particular importance in dealing with China. But why Hungary? What made Hungary so popular to Chinese people 20 years ago? In 1988 a Hungarian-Chinese consular agreement – among other things – included the abolishment of visa requirements between the two countries. In 1990, 11 000 Chinese people arrived to Hungary, while in 1992 the number was 27 000. Overall, in the 90s Hungary had a Chinese minority of approximately 40 000, even though in the 80s, the number of Chinese people living in Hungary was only a few hundred. Of course, in addition to the lack of a visa requirement, there were other – economic, political and emotional – factors which pushed the Chinese towards Hungary.

Economic factors:

1989 was a recession year in China and Chinese residents living abroad did not have to pay taxes.
There was social stability in Hungary compared to China.
Accessing Budapest by train was inexpensive compared to other destinations.
Chinese migrants found a gap in the Hungarian market, a business opportunity, as there was huge demand for cheap consumer goods.

Political factors:

After the massacre in Tiananmen Square and the democratic shift in Hungary, the possibility of free travel became especially important.

Emotional factors:

Thanks to the attention the Chinese government paid (during the 78/79 reform process) to Hungarian “reform socialism”, Hungary’s reputation among Chinese people was quite good and the impressions of the first Chinese migrants were also promising. They described Hungary as a treasure land, “Eastern Europe’s heavenly palace”, so more and more people chose this destination.
Finally, there were and there continue to be some Chinese who really believe that the Chinese and Hungarians are distant relatives.¹ The evidence is that we have similar physical characteristics to Asians (dark hair, dark eyes, medium height), which differentiate us from other Eastern or Central European nations. And names are written and sometimes spoken in the same order (the family name followed by the first name), which is unique in Europe.²

After 1992, the Hungarian authorities re-introduced the visa requirement, so the number of Chinese immigrants has declined. Some of the original 40 000 Chinese people living in Hungary left the country, went home or moved to other countries in the following 5-10 years. But close to 30% have stayed, supplemented over time by a small number new arrivals – for the most part relatives of the Chinese already living in Hungary.

To maintain this advantage and to make Hungary a popular destination for Chinese businesses and investment in the 21^st century, the Hungarian Government has undertaken several measures and gestures, including the creation of a new special envoy position within the Prime Minister’s Office for the development of Hungarian-Chinese relations and for the coordination of the China-related work of governmental institutions and the public administration. The first results of the new policy were the arrival of a branch of the Bank of China in Hungary (2003), the creation of the Bilingual Chinese / Hungarian Primary School in Budapest (2004) and the initiation of a direct flight connection between Budapest and Beijing (2004). All of these are unique in the region. There are many other results – a complete list would be too long to enumerate here – including collaboration between the Hungarian and Chinese railway companies, the establishment of a wholesale trade centre in Budapest focused on hosting quality Asian exporters and manufacturers, and the establishment of the China Investment Promotion Agency’s (CIPA’s) European Office in the Hungarian capital last year.

As shown above, there are more and more opportunities in relations between Hungary and China, but also a lot of things still to do to strengthen ties between them. As Barna Tálas, one of the more well-known Hungarian sinologists put it, with a well-coordinated, open and development-oriented foreign economic policy, Hungary has very good prospects to become “Europe’s Hong Kong”,³ namely the international trade and financial centre between the two regions, managing the exchange of goods and information and the transfer of technology and capital, as Hong Kong did earlier in East Asia.

Ágnes Szunomár is a China-expert and Research Fellow at the Insitute of World Economics, Budapest

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