As the Three Seas Initiative summit in Sofia ends today, here's a #THREAD comparing 🇺🇸&🇨🇳 approaches towards CEE
16+ and the 3SI are twin platforms, aimed at leveraging CEE connectivity - and projecting power
What's the difference? How do 🇺🇸&🇨🇳 compete?
Here we go:
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16+ and the 3SI are twin platforms, aimed at leveraging CEE connectivity - and projecting power
What's the difference? How do 🇺🇸&🇨🇳 compete?
Here we go:
1/13
Both 16+1 and 3SI are regional platforms in which 🇨🇳&🇺🇸 deal with CEE as a bloc - a handy diplomatic tool, given how fragmented the region is.
You can spot obvious differences though - 16+1 stretches much further south, to Greece and the Balkans - with five non-EU members.
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You can spot obvious differences though - 16+1 stretches much further south, to Greece and the Balkans - with five non-EU members.
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What's the purpose?
Both 🇨🇳&🇺🇸 spotted a huge connectivity gap in CEE - lack of cyber, transport and energy infrastrucure. The issue of who will finance it, build it and run it will have tremendous political implications. Hence the stiff competition.
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Both 🇨🇳&🇺🇸 spotted a huge connectivity gap in CEE - lack of cyber, transport and energy infrastrucure. The issue of who will finance it, build it and run it will have tremendous political implications. Hence the stiff competition.
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Here's how the US Congress explains it. US also adds Russia as a connectivity competitor in CEE.
As of China, there were times where 16+1 documents officially endorsed the 3SI (!). But now, being pushed out from CEE cyber and energy projects by the US, the rivalry is there.
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As of China, there were times where 16+1 documents officially endorsed the 3SI (!). But now, being pushed out from CEE cyber and energy projects by the US, the rivalry is there.
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The first major 16+1/3SI difference: decision-making
16+1 is a 'hub-and-spoke' structure controlled by China, with a permanent secretariat located in China's MoFA.
3SI is based on rotational summmits, led by CEE governments that invite external partners (incl. 🇺🇸)
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16+1 is a 'hub-and-spoke' structure controlled by China, with a permanent secretariat located in China's MoFA.
3SI is based on rotational summmits, led by CEE governments that invite external partners (incl. 🇺🇸)
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The second major 16+1/3SI difference: the EU's position
16+1: 🇪🇺 loathes the format and fights it (EEAS is an observer though), just as 🇩🇪 does
3SI: 🇪🇺 European Commision endorsed the format, and 🇩🇪's President Steinmeier attended the summit. Thumbs up for 🇪🇺-🇺🇸 rel.
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16+1: 🇪🇺 loathes the format and fights it (EEAS is an observer though), just as 🇩🇪 does
3SI: 🇪🇺 European Commision endorsed the format, and 🇩🇪's President Steinmeier attended the summit. Thumbs up for 🇪🇺-🇺🇸 rel.
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Now let's look at the money - as we're talking about connectivity.
Both 16+1 and 3SI established prive equity investment funds with government money. Although similiar in size (€ 1 bn), you can see the shareholding differences - reflecting China's dominance in 16+1
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Both 16+1 and 3SI established prive equity investment funds with government money. Although similiar in size (€ 1 bn), you can see the shareholding differences - reflecting China's dominance in 16+1
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But let's be fair - €1bn investment funds are nice, but will never bridge the €300bn+ regional connectivity gap.
That's where gov credit lines come in, with China's Exim (mostly for Balkans) and CDB (mostly for EU MS) offered ~$12bn of credit lines
US - your move!
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That's where gov credit lines come in, with China's Exim (mostly for Balkans) and CDB (mostly for EU MS) offered ~$12bn of credit lines
US - your move!
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Just to be clear
The European Union is and will be the main source of connectivity financing for CEE. In 2014-2020, it provided ~€80 bn for cyber, transport and energy for CEE member states, with several more € bn for the Balkans.
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The European Union is and will be the main source of connectivity financing for CEE. In 2014-2020, it provided ~€80 bn for cyber, transport and energy for CEE member states, with several more € bn for the Balkans.
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The key for external powers willing to join the CEE connectivity game is to find synergies with the EU, not to compete with it. In this respect 🇺🇸 (and 🇯🇵 that's also interested in 3SI) is doing a much better job than 🇨🇳.
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To sum it all up
US and China compete for CEE connectivity - and that's not neccessarily a bad thing
Compared to 16+1, the 3SI is much better structured (the region effectively owns the format) and better positioned internationally (🇪🇺 accepts it).
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US and China compete for CEE connectivity - and that's not neccessarily a bad thing
Compared to 16+1, the 3SI is much better structured (the region effectively owns the format) and better positioned internationally (🇪🇺 accepts it).
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But the 3SI still lacks the financial muscle, that could be either gov or private money.
A problem similiar to the latest G7 Build Back Better World (B3W) initiative. And no wonder, as the 3SI is a indeed a 'pilot project' for the transatlantic connectivity cooperation.
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A problem similiar to the latest G7 Build Back Better World (B3W) initiative. And no wonder, as the 3SI is a indeed a 'pilot project' for the transatlantic connectivity cooperation.
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On the other hand, the 16+1 is losing steam ( Lithuania just left!), with many countries being disillusioned with 🇨🇳 financing terms & political risks. But money talks and China is ready to innovate.
That's all for today, thanks for reading. Stay tuned!
13/end.
That's all for today, thanks for reading. Stay tuned!
13/end.
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