Sustaining Momentum in the Western Balkans During the Coronavirus Pandemic

Report Europe

Sustaining Momentum in the Western Balkans During the Coronavirus Pandemic

April 26, 2021 19 min read Download Report
Daniel Kochis
Senior Policy Analyst in European Affairs
Daniel Kochis is a senior policy analyst in European Affairs in the Margaret Thatcher Center for Freedom.

Summary

Progress in the Western Balkans resulting from direct U.S. engagement should not give way to complacency. The COVID-19 pandemic has dented the transatlantic community’s appeal, particularly the EU’s image in the region, and created space for both China and Russia to cash in on the region’s troubles. The U.S. should continue to seek constructive engagement in the Balkans, working with like-minded European partners to ensure that the region remains firmly planted on a transatlantic trajectory post-pandemic. Constructive engagement from the Biden Administration in the Balkans, for instance, by expanding the Three Seas Initiative, continuing support for Kosovo’s recognition as an independent state, and aiding pro-growth economic reforms would build on recent momentum and best minimize the risk that any nefarious outside influences can derail the region’s future as part of the transatlantic community.

Key Takeaways

The Western Balkans remain a vital geostrategic region and recent progress from U.S. engagement should not give way to U.S. complacency.

China and Russia have capitalized on the ongoing COVID-19 pandemic to take advantage of the region’s struggles and burnish their influence.

The U.S. and Europe should work to minimize nefarious outside influences seeking to derail the region’s future in the transatlantic community.

Under the Trump Administration, U.S. policy in the Balkans had some important successes, notably, the accessions of Montenegro (2017) and North Macedonia (2020) to the North Atlantic Treaty Organization (NATO), as well as the 2020 signing of economic normalization agreements between Kosovo and Serbia.

Progress should not give way to complacency, however. The Western Balkans remain home to unfinished business. The region warrants continued focused attention, particularly considering Chinese and Russian efforts to capitalize on the ongoing coronavirus pandemic to burnish their influence in the Western Balkans.

Constructive engagement from the Biden Administration in the Balkans, for instance, by expanding the Three Seas Initiative (3SI), continuing support for Kosovo’s recognition as an independent country, and aiding reforms that will unleash prosperity would build on recent momentum and best minimize the risk that any nefarious outside influences can derail the region’s future in the transatlantic community.

Recent Chinese Expansion in the Region

Chinese interest in the Western Balkans stems from the region’s geostrategic location near major European economies. Situated as a southern gateway to Europe, the Western Balkans have attracted modest Chinese investments over the past several years. As one analyst noted, “China’s economic footprint in the Western Balkans is still shallow, but it has grown rapidly over a short period of time.”REF China’s marquee regional investment, the Greek port of Piraeus, controlled by the Chinese firm COSCO Shipping, is Europe’s fourth-largest port. The rail network from the port runs north through the Western Balkans. Today, China accounts for only 5.7 percent of foreign trade with the Western Balkans and only 3 percent of the region’s foreign direct investment.REF However, Chinese investments have the potential to erode the allure of continuing a westward trajectory, trapping countries in a deep well of debt to China, and reinforcing the existing stasis in which many Western Balkan nations find themselves.

Much of the Chinese footprint in the region has taken the form of loans for infrastructure investments. For instance, in 2014, Montenegro took out a €1 billion ($1.2 billion) loan to help build the first phase (44 kilometers (km) of 165 km)REF of a portion of a highway connecting the city of Bar with Belgrade, the Serbian capital. The project is financed almost entirely through loans from the Export–Import Bank of China, with the China Road and Bridge Corporation the contractor for the project.REF In 2017, the International Monetary Fund issued warnings about Montenegro’s ability to repay the loan. Recently, the European Union declined a Montenegrin request to help it repay the loan, stating that the EU does not “repay loans from third parties.” Instead, the EU offered to assist with financing to complete construction of remaining sections of the highway, via development funds.REF

Other key Chinese investments in the Western Balkans include, but are not limited to, coal-fired electricity generation plantsREF and hydroelectric power plantsREF in Bosnia and Herzegovina; Europe’s largest onshore oil field in Albania;REF two major highways in North Macedonia;REF and mines, steel mills, and tire factories in Serbia.REF

Chinese activity in the Western Balkans is a long-term investment that seeks to garner diplomatic, economic, and political influence. China has already reaped some dividends, including Western Balkan nations toeing Beijing’s line on its One China policy in relation to Taiwan,REF Serbian support of China’s crackdown on pro-democracy protestors in Hong Kong,REF and, in 2016, Montenegro calling for “dialogue” after the Permanent Court of Arbitration in The Hague sided with the Philippines over China on a series of issues related to the South China Sea, and criticizing the Philippines for acting unilaterally in bringing the case.REF

Pandemic Openings

The ongoing COVID-19 pandemic has opened avenues for both China and Russia to deploy vaccine diplomacy in the Balkans. While Serbia began its vaccinations with the Pfizer–BioNTech vaccine in December 2020, it has since relied on a patchwork of vaccines to leapfrog most of Europe in its vaccination campaign. To date, 27 percent of Serbia’s population of 7 million have received at least one dose of a vaccine.REF By comparison, at the time of this writing, only 19 percent of French citizens have received at least one vaccine dose.REF

Serbia became the first European country to use China’s Sinopharm vaccine, with a million doses received in mid-January 2021.REF In March, Serbian President Aleksandar Vucic called the EU’s proclaimed solidarity a “fairy tale,” and stated that the “only country that can help us is China.”REFAlso in March, he publicly kissed the Chinese flag upon the arrival of a shipment of Chinese-made personal protective equipment (PPE).REF On April 6, Vucic received the Chinese vaccine on live television,REF and Serbia has plans to produce Sinopharm domestically by mid-October.REF Serbia, which already partners with Chinese companies to use artificial intelligence (AI) for surveillance cameras in Belgrade, has further employed Chinese AI to aid its vaccine rollout.

Serbia has also purchased Russia’s Sputnik V vaccine and plans to begin producing Sputnik shots in Serbia by May.REF Vucic has credited “friendly”REF relations with China and Russia for aiding the country’s vaccine rollout. Serbia has adroitly utilized its excess capacity to assist its neighbors, whether via donations to Bosnia and Herzegovina, Montenegro, and North Macedonia personally delivered by President Vucic,REF or an announcement in late March that foreigners could receive a free vaccination that weekend (Serbia had nearly expired AstraZeneca vaccines), which attracted 22,000 people from neighboring nations.REF The weekend effort was so successful that Serbia now allows foreigners to register for vaccines online.REF

Aside from Serbia, nearly all Western Balkan nations initially indicated a preference for EU-approved vaccines, mostly relying on the global COVAX systemREF for acquisition. Additionally, in late December, the EU approved €70 million ($84.2 million) to assist the Western Balkans for early access to purchasing EU-approved vaccines and aid in their distribution.REF However, the EU’s own botched vaccination efforts stymied efforts by Western Balkan nations to acquire Western-produced vaccines. While the region was exempt from the EU vaccine export ban,REF by February, Bosnia and Herzegovina, Kosovo, Montenegro, and North Macedonia had yet to receive any EU-approved vaccines.REF

Sluggish progress on receiving vaccines led all Western Balkan nations to purchase, or, in the case of Croatia, to discuss purchases of, Chinese and Russian vaccines. Bosnia and Herzegovina ordered 1.2 million doses via COVAX,REF but did not receive its first shipment until March 25.REF The nation, hard hit by a second COVID-19 wave, made alternative arrangements. In February, the Republika SrpskaREF began receiving the first vaccines from its order of 400,000 Sputnik V vaccines.REF The Bosniak–Croat Federation announced in mid-March that it planned to purchase 500,000 Sputnik V vaccines.REF In late March, a Turkish donation of 30,000 Chinese-made vaccines arrived in Bosnia and Herzegovina.REF Likewise, North Macedonia placed orders of 200,000 for both Russia’s Sputnik vaccine as well as China’s Sinopharm vaccine.REF Montenegro has ordered 150,000 doses of China’s Sinopharm vaccine,REF and a donation of 30,000 additional doses in boxes marked “China Aid” arrived in Montenegro in early March.REF Montenegro is also vaccinating its population with the help of 250,000 doses of Sputnik V ordered from Russia.REF

Albania began vaccinations in January with small numbers of Pfizer–BioNTech, AstraZeneca, and Sputnik vaccines. Albania agreed to a deal to purchase 500,000 doses of Sinovac, China’s other vaccine, with an option to purchase 500,000 more via a Turkish distributor.REF The first 192,000 doses arrived in Albania on March 25.REF Albanian Prime Minister Edi Rama also announced Chinese plans to build a vaccine-manufacturing facility in Albania.REF On April 5, Prime Minister Rama announced that his nation had concluded an agreement with Russia to purchase an additional 50,000 Sputnik vaccines.REF

Croatia, the only Western Balkan nation that is also an EU member, has thus far stood by a commitment not to use any vaccine not approved by the EU. However, recent talks with Russia over potential purchases of Sputnik VREF and Croatians seeking vaccinations in neighboring SerbiaREF indicate that that position may be faltering. A Brazilian study published in April 2021, which found that China’s Sinovac vaccine was only 50.7 percent effective in preventing symptomatic COVID-19,REF underscores the long-term wisdom of Croatia’s approach not to use vaccines outside the EU approval framework, and calls into question the effectiveness of the region’s vaccination efforts.

Pandemic Themes in Russian Propaganda. Russia has also sought to find advantage in the pandemic, playing up Russian pandemic assistance for maximum public relations impact. As one example,

[i]n April 2020, to much media pomp, 11 Russian aircraft with 87 military doctors, Nuclear Biological Chemical specialists and equipment landed in Serbia to disinfect streets, hospitals and barracks across that country. While Serbia has its own military capacities for the same purposes, these were overshadowed by the guests.REF

Russia has adroitly exploited the inability of the Western Balkans to procure Western vaccines to fashion a message of abandonment by the West.REF Russia and China have also worked together to disseminate outlandish claims that COVID-19 originated in a U.S. lab.REF

The U.S. Should Refocus Attention on the Western Balkans

Both China and Russia have sought to capitalize on the pandemic, wielding PPE and vaccines to bolster credibility, spreading propaganda to take advantage of the region’s struggles, and banking on a West distracted by its failing pandemic response. The region, however, deserves continued Western attention and is an area where the U.S. and Europe should work together to assemble an active strategy of engagement.

The U.S. should:

  • Renew and maintain a focus on the Western Balkans. The pandemic has only deepened trends already underway in the Balkans. Russia continues a campaign of interference, pressure, and propaganda with the aim of regional destabilization. China is leveraging investment funding, pandemic aid, and propaganda to garner a greater pool of influence. A need for vaccines has opened the door wider for China and Russia in nearly every Western Balkan nation. The recent announcement of a donation of 650,000 Pfizer vaccines to the region by European Commission President Ursula von der Leyen will help to alleviate immediate pressure, but is not a panacea.REF
  • Consider eventual vaccine aid to region. The Western Balkans have some of the world’s highest COVID-19 rates per capita. As the U.S. vaccination campaign continues to progress, the Administration should consider ways in which it can aid Western Balkan nations in acquiring safe vaccine doses.
  • Keep NATO’s door open for Western Balkan nations. The U.S. should ensure that the Alliance’s open-door policy remains available for deserving European countries. With North Macedonia joining the Alliance in March 2020, Bosnia and Herzegovina remains the most realistic Balkan prospect to join the Alliance next. Recent threatsREF by the Russian embassy in Sarajevo over potential membership for Bosnia and Herzegovina should underscore the importance of reaffirming that Russia should not have a veto over the decision of the sovereign member states of NATO. While many domestic political obstacles remain, such as the lack of support for membership by the Republika Srpska, NATO must keep the country on track for eventual membership. NATO enlargement has helped to bind like-minded democracies on both sides of the Atlantic in mutual self-defense. Furthermore, requirements for joining the Alliance have proven to be critical catalysts for reform, particularly of militaries, and for strengthening the rule of law in candidate countries.
  • Support Kosovo’s long-term transatlantic aspirations. While Kosovo is not yet ready to join NATO and has significant challenges to overcome, the Alliance should welcome Kosovo’s transatlantic aspirations, take a patient approach, and support modernization and key reforms.
  • Stay committed to the Kosovo Force (KFOR) mission. NATO forces will continue to remain the hearthstone of Kosovo’s security. General Tod Wolters, Commander of the United States European Command, recently testified that “KFOR enables the security conditions required for normalization of Serbia–Kosovo relations and the planned 10-year transition of the Kosovo Security Force from 2018 to 2028.”REF Today it is more important than ever that KFOR continue with robust participation with allies across NATO.
  • Support Kosovo’s inclusion in international organizations. The U.S. should continue to use its diplomatic and political leverage to support international recognition of Kosovo as an independent country, and Kosovo’s inclusion in relevant international organizations.
  • Pressure Serbia to recognize Kosovo as an independent sovereign nation. The U.S. cannot allow recent progress in Kosovar–Serbian relations to absolve Serbia of its continued failure to recognize Kosovo, as well as its actions blocking Kosovo from international organizations, which impede regional progress, including in Serbia itself. While China and Russia support Serbian non-recognition of Kosovo, the U.S. should employ the tools at its disposal to dissuade Serbia from continuing on this path. Recognizing Kosovo will be a significant step for Serbia toward the West and toward a brighter future.
  • Urge both sides to return to the negotiating table. The U.S. and the EU share a mutual interest in continuing to push the Kosovar–Serbian relationship toward normalization. The Biden Administration is correct in encouraging both nations to return to the EU-facilitated normalization talks.REF
  • Keep the lid firmly on Pandora’s box by ruling out land swaps. Reports of diplomatic notes floating through Europe proposing land swaps in the region should be cause for concern.REF Swapping land and redrawing borders based on ethnic and sectarian lines would mark a dangerous precedent, which would give birth to greater instability. The U.S. should make it clear that it does not support Western Balkan land swaps and should squelch the proposals before they gain steam.
  • Promote the idea of non-EU states joining the Three Seas Initiative (3SI). Currently, the 3SI only includes EU member states. This serves as an artificial constraint to regional cooperation, since so many countries, for instance, much of the Western Balkans, are not EU members. Broadening the scope of the 3SI will help to steel vulnerable nations against undue influence from China and could help to fund worthy infrastructure projects via the Three Seas Investment Fund.REF
  • Retain support for reforms. The World Bank’s current projection is for 4.4 percent growth in the Western Balkans in 2021.REF In light of rethinking supply chain security, one recent analysis suggested that Western policymakers should consider the potential for the Western Balkans in “‘near-shoring’ the production of critical goods within the transatlantic economy, and diversify production networks to reduce over-dependency on China.”REF Continued support for reforms that improve rule of law, increase economic freedom, and tamp down on corruption will better support regional prosperity, allow Balkan nations to retain their youngest talent, and further open the door to the possibility of the region integrating more deeply into transatlantic supply chains.
  • Counter Chinese and Russian propaganda. China and Russia seek to take advantage of a dearth of independent media in the Balkans, distributing inflammatory messages that exacerbate cultural, ethnic, historical, and religious tensions, and pillory the transatlantic community as inept and powerless. The U.S. should publicly and forcefully respond to high-profile falsehoods, look for ways to support independent media in the region, and make use of American public diplomacy to counter pernicious messages.

Conclusion

Recent examples of progress in the Western Balkans resulting from direct U.S. engagement should not give way to complacency. The COVID-19 pandemic has dented the transatlantic community’s appeal, particularly the EU’s image in the region, and created space for both China and Russia to cash in on the region’s troubles. The U.S. should continue to seek constructive engagement in the Balkans, working with like-minded European partners to ensure that the region remains firmly planted on a transatlantic trajectory post-pandemic.

Daniel Kochis is Senior Policy Analyst for European Affairs in the Margaret Thatcher Center for Freedom, of the Kathryn and Shelby Cullom Davis Institute for National Security and Foreign Policy, at The Heritage Foundation.

Authors

Daniel Kochis
Daniel Kochis

Senior Policy Analyst in European Affairs