Untapped Instrument. Sovereign Wealth Funds and Chinese policy toward the Central and Eastern European countries

Abstract

This chapter aims at looking at the role of Sovereign wealth funds (SWFs) in China’s policy toward Central and Eastern European (CEE) countries in the 21st century, especially since the enlargement of the European Union (EU) in 2004. During this time, we could observe an increase of Chinese interest in the region resulting in growing trade, investments and number of contacts on all levels. China has used a wide array of different instruments to achieve its goals in the region: from a big political project such as the “16+1 format” to an unprecedented frequency of contacts between Chinese provinces and their European counterparts (Kaczmarski, Jakóbowski 2015). Despite a visible growth of economic ties, Beijing presented a very limited will to use investments as a political instrument. Even if Chinese investments in CEE are booming, they are possibly less politically biased and more market-driven than those in other developing countries, like African ones.