Behind the scenes: Chinese influence in North Macedonia

Chinese influence reached development projects, science, culture, and media

Originally published on Global Voices

This story was produced by Meta. mk as part of the Western Balkans Anti-Disinformation Hub. An edited version is republished here under a content-sharing agreement between Global Voices and Metamorphosis Foundation.

It took North Macedonia only a few years to dramatically change its bilateral relationship with China. In 1999, it was the sole European country that recognized Taiwan as an independent state, besides the Vatican. In that period of time, Beijing severed diplomatic ties with Skopje. In 2001, Macedonian state authorities decided to withdraw their recognition of Taiwan and reestablish diplomatic relations with China. In fewer than 15 years, Macedonian politicians dramatically reversed course: from the recognition of Taiwan in 1999 to taking a loan from China’s Exim Bank in 2013 to fund major construction initiatives.

A new era of relations with China

China entered North Macedonia during the tenure of former prime minister Nikola Gruevski who ruled from 2006–2017. Gruevski and his right-wing populist VMRO-DPMNE political party were caught in political gridlock due to a name dispute with Greece, so North Macedonia’s membership applications for NATO and the EU were paused at this time. This was an ideal opportunity for China to pull this  Balkan state into its sphere of influence.

In October 2013, Macedonia’s parliament decided to support the Gruevski administration’s proposal to take a loan from the Chinese Exim Bank to construct highways in North Macedonia — the Kičevo-Ohrid and Miladinovci-Štip. At the same time, the Macedonian government chose the Chinese state construction company Sinohydro as the main contractor, which started implementing these projects in early 2014.

Over the next nine years, Sinohydro successfully competed with domestic and foreign construction companies in implementing two more capital infrastructure projects in North Macedonia, both financed with loans from the European Bank for Reconstruction and Development (EBRD). In 2019 it won the international tender procedures to construct the second phase of the Štip-Kočani expressway, as well as a section of the new Gradsko-Prilep expressway on the Pan-European Corridor 10D. Construction started on June 9, 2021.

However, the construction of the Kičevo-Ohrid highway, which started nine years ago, is still not finished. In 2017 the former Special Public Prosecutor’s Office filed an indictment in the case code-named “Trajectory,” accusing high government officials, including then-Prime Minister Gruevski and Minister of Transport and Communications Mile Janakieski, of rigging the public procurement procedure, graft, and abuse of office. Evidence included 315 wiretaps and numerous SMS messages, including infamous recordings of politicians referring to their Chinese partners using racist slurs.

The court scheduled the first hearing in the trial for December 6, 2017. However, the trial for the “Trajectory” case was restarted, after the Judicial Council of the RNM dismissed judge Goran Boševski because of high corruption in June 2020. Two and a half years later, this trial has still not been completed.

Chinese influence in the railway sector

China has also managed to enter the railway sector of North Macedonia. The former Minister of Transport and Communications Mile Janakieski, together with the former Minister of Finance Zoran Stavreski, signed the agreement with the Chinese Company CSR on June 24, 2014, for the purchase of four diesel multiple-unit trains and two electric multiple-unit trains for passenger transport. The Chinese trains arrived in North Macedonia in February 2017.

The then-director of the state railway operator, Nikola Kostov, stated that around 60 percent of the fleet for passenger transport of Macedonian Railways-Transport would be replaced by Chinese trains. Today, this company is named “Republic of North Macedonia’s (RNM) Railways – Transport” and it has four additional Chinese electric locomotives used for cargo railroad transport. In January 2017, an agreement was signed with the Chinese company Zhuzhou CRRC, and toward the end of 2020, RNM’s Railways-Transport put all four electric locomotives into use. Since then, it has complained about maintenance issues — a problem that has dragged on since 2019.

At the same time, RNM’s Railways – Transport’s official documents indicate that between 2019–2021 a company called PEARL CA became the biggest client of the Macedonian state-owned company in the cargo transportation segment. PEARL CA is owned by the Chinese state-owned mega-conglomerate COSCO which has been acquiring an increasing share in North Macedonia’s cargo rail transport over the years.

5G network in North Macedonia without Chinese influence

During the  2010s, the procurement of 3G and 4G networks in North Macedonia was performed by Macedonian telecommunication operators from the Chinese technological companies Huawei and ZTE. However, on October 23, 2020, the former Prime Minister Zoran Zaev and Under Secretary for Economic Growth and Environment at the US State Department, Keith Krach, signed the Memorandum of Understanding on 5G Security, where North Macedonia agreed to align its national policies about the development of electronic communications with EU and US interests.

North Macedonia, as a member of NATO and signatory of the Clean Network Program initiated by the US, decided to exclude Chinese technological companies from the development of the national 5G network to address “the long-term threat to data privacy, security, human rights, and principled collaboration posed to the free world from authoritarian malign actors.” The signed memorandum with the US prompted them to amend the Law on Electronic Communications (LEC) in April 2021. The Electronic Communications Agency (ECA) of North Macedonia adopted these regulations in the autumn of 2021, and they went into force immediately. Both Macedonian Telecom and A1 Macedonia, as telecom operators in North Macedonia, called for proposals for the development of 5G network infrastructure throughout North Macedonia. The winner was the Swedish company, Ericsson.

China is “here to stay”

At the end of December 2022, Ana Krstinovska from the think-tank ESTIMA presented the research “Understanding the tools, narratives and influences of Chinese ‘soft power’ in North Macedonia.” She stressed that according to the Global Soft Power Index, in 2022, China held the fourth place globally in the general placement, following the USA, Great Britain, and Germany.

The 2022 research on the presence and the portrayal of China in the media, which was supported by the German foundation Konrad Adenauer Stiftung, showed that Chinese influence in the country is quite strong, while North Macedonia can be ranked in the third out of 17 Central and Eastern European countries.

ESTIMA’s research showed, for example, that the number of translated books from Chinese into the Macedonian language has increased dramatically in the last few years. From 1978 to now, a total of 90 Chinese titles have been published in North Macedonia, and 50 of them have been published since 2018. Half of the translated books are, in fact, children’s books.

ESTIMA’s research examined the activities of the Confucius Institute in Skopje and the offer of Chinese scholarships, training, research projects, and other activities implemented between China and North Macedonia, labelled in the report under the category “building relations.” Krstinovska noted: “In the last few years, China became more active in implementing joint research projects up to the point that today North Macedonia has more bilateral projects with China than it has with any other country in the world (a total of 40 in the last 5 years).”

Another mapping of China’s influence in North Macedonia, done by the Taipei-based China Index, indicates that domestic politics and the economy are the main spaces Beijing has made inroads.

The latest policy paper, published in December 2022 by the Friedrich Naumann Foundation for Freedom (FNF), in cooperation with the Sofia Security Forum, looks into the influence of China in eight countries or territories of Southeast Europe, including North Macedonia.

The report section on North Macedonia indicates that by the end of 2021, the volume of Chinese investment in North Macedonia amounted to EUR 130.37 million, or only 2 percent of the total Foreign Direct Investment (FDI) stock in the country. According to the policy paper, this outcome is related to objective factors, such as the small size of the Macedonian market, but also to the priorities of Chinese investors, who are usually in search of capital-intensive projects and are driven primarily by the desire to acquire companies in strategic industries, startups with high growth potential, competitive brands, and new technologies.

The FNF policy paper argues that despite the limited benefits so far, Macedonian citizens continue to have a favorable opinion of China, not because of the “material impact of the cooperation, but because of the sense of possibility that China inspires.”

FNF’s policy paper concluded that China’s “soft power” is exerted in two main dimensions. The first is in the category “news management,” as some Macedonian print and online media publish columns and articles by the Chinese ambassador in the country. The second dimension of “soft power” is the category “sending strategic messages,” with China acting within the framework of cultural cooperation of twin towns, or through activities implemented by the Confucius Institute, which is integrated into the state University Sts Cyril and Methodius in Skopje. This includes translating and publishing books, releasing Chinа-sponsored television programs such as “Ni Hao,” which is broadcasted on Telma TV, as well as promoting PR for Chinese companies, primarily Huawei.

Written by Metamorphosis Foundation