CritCom | Homepage

Macedonia’s Crisis: A Challenge for the New Silk Road?

0 Comments 🕔14.Dec 2015

This article is part of our feature Re-imagining the Silk Road.

Damage to a building in Kumanovo, Macedonia in May 2015. Photo credit: Ian Bancroft


by Anastas Vangeli

Macedonia’s ongoing political crisis poses a challenge for an unlikely geopolitical venue: the efforts by the Chinese government to bring the One Belt, One Road (or the ‘New Silk Road’) Initiative to the Balkans. While aiming to facilitate cooperation with the European “core,” the New Silk Road extends throughout the regions in between. It brings together two already developing sub-regional diplomatic initiatives by China in Central, Eastern, and Southeastern Europe—including Europe’s Eastern Neighborhood—with the wider Mediterranean region. The Balkans, with Macedonia at its center, lies at the intersection of these different Chinese initiatives.


Macedonia’s Place on the New Silk Road

Macedonia is one of the sixteen countries of Central, Eastern and Southeastern Europe (named CEE16 by Chinese policymakers and scholars) with which the Chinese Ministry of Foreign Affairs has a special mechanism for cooperation (dubbed CEE16+1). China sees the CEE16 as a whole as crucial for facilitating the construction of the New Silk Road, and for connectivity and cooperation between Europe and Asia in general, and China and the European Union (EU), specifically. In particular, China sees Macedonia and other non-EU countries in the Western Balkans as having certain advantages and being more “flexible,” as they are not (yet) part of the EU. The increasing Chinese activity in the region was also intended to have a stimulating effect, reassuring these countries that they will remain internationally relevant, especially at a time when their accession to the EU is stalling.

China’s strategy in the Balkans and Macedonia also intersects with the Maritime Silk Road in the wider Mediterranean region, and in particular, Greece. A strategic partner of China, Greece houses one of the key Chinese investments in Europe–the Piraeus Port, whose Piers II and III, since 2009, have been under concession to the Chinese state-owned enterprise (SOE), China Ocean Shipping Company (COSCO), making it “the world’s fastest growing container port” [1] and a central asset in China’s Maritime Silk Road.

Bordering Greece in the south and Serbia in the north, with a thirst for investment and infrastructure development, Macedonia has the potential to become an important part of the New Silk Road in the Balkans. The Chinese plan is ultimately to link Greek ports to Central European markets by land; this is the context in which the landmark Budapest-Belgrade high-speed railway has been framed.[2] It is expected that it will be the first leg of a larger, trans-Balkan high-speed rail, which will also include Macedonia (Macedonia’s Prime Minister Nikola Gruevski took part in signing the agreement). In addition to the new railway from Budapest to Athens, there has been growing interest in centuries-old proposals for inland waterways and other related projects. However, the situation has changed dramatically in the past several months.


The Crisis and the Way Out

Macedonia’s current political turmoil entered a critical phase in the aftermath of mass anti-government protests that started on May 5th 2015 and a violent and deadly clash between the police forces and a militant group in the city of Kumanovo that threatened to destabilize the country and stoke ethnic tensions. The society-wide revolt against the incumbent government, led by Nikola Gruevski of the Democratic Party for Macedonian National Unity (VMRO-DPMNE), comes after nine years into the gradual but consistent rise of a corrupt, authoritarian model.

Macedonian Prime Minister Nikola Gruevski in 2011.

Macedonian Prime Minister Nikola Gruevski in 2011. Photo credit: European People’s Party.


The dynamics in the country changed once the political leaders entered negotiations under the mediation of the EU and the US. Negotiations have mainly taken place between several party leaders: Prime Minister Gruevski; Zoran Zaev, the leader of the opposition party Social Democratic Union of Macedonia (SDSM); and the leaders of ethnic Albanian parties, including Ali Ahmeti of the Democratic Union for Integration (DUI), a coalition partner of Gruevski, and Menduh Thaci of the Democratic Party of the Albanians (DPA), a nominally oppositional force which is however entangled in business relations with Gruevski. The process is expected to yield a compromise that will likely result in a makeover of the government, allowing an exit strategy for the Gruevski government and opening the way for early parliamentary elections in 2016. A potential failure, however, is seen as having the potential to make Macedonia “isolated like Belarus.”[3]

Due to the complexity of the crisis and its regional context, Macedonia’s situation is often framed in geopolitical terms. While Macedonia’s crisis is not in its nature a geopolitical one, and can best be explained through local agency, it certainly contains elements that feed into the temptation to provide such a geopolitical explanation. Macedonia has traditionally been a partner and proponent of the European and the Euro-Atlantic agenda in the wake of the legitimacy crisis. As the crisis was unfolding, Gruevski’s government and public supporters occasionally flirted with Russia, though as of yet, nothing has progressed beyond discussions. The Kremlin, however, has reciprocated: as Gruevski’s governance is exposed to harsh criticism in Washington and Brussels, it is Russia, which has remained virtually silent on Macedonia for the past decade, which has provided support for the Gruevski government and accused the West of destabilizing the country.[4] Meanwhile, EU and US responses to the Macedonian crisis have firmly favored an outcome that would weaken Gruevski and political manipulation, including threats of sanctions and blacklisting government officials.

In addition to exploring closer political ties with Russia, Gruevski has also attempted to boost economic cooperation with emerging economies worldwide. These measures have been met with very little success, even though he has pushed for a radical neoliberal framework, including tax exemptions and subsidies for investors and a deliberate deterioration of the conditions and rights of Macedonian workers. On the other hand, Gruevski has completely overlooked the importance of political stability, the will to combat ongoing corruption, and a constructive approach to foreign policy in the process. Thus, bad policymaking has not only damaged Macedonia’s ties with the West, but has also decimated its potential to develop more meaningful and beneficial ties with other global actors. The China-Macedonia relationship is a paradigmatic example of this.


Corruption scandals and instability threaten Sino-Macedonian cooperation

Under the rule of VMRO-DPMNE, Macedonia has faced bad press in China on a few occasions. In 1999, it explicitly violated the One-China Policy by recognizing Taiwan, leading to the severing of ties with Beijing until the normalization of relations in 2002. VMRO-DPMNE’s second term in power might well pose a significant setback or at least slowdown in relations with China.

In a months-long campaign dubbed the “Truth about Macedonia,” the leader of the Macedonian opposition, Zoran Zaev, published a number of leaked tapes of conversations among top government officials, providing evidence of electoral fraud, corruption, extortion, and other unconstitutional, criminal, and unethical abuses of power. The Gruevski government has attempted to prevent the content of the tapes from making it into the hands of prosecutors, and has even pushed for their removal from the media – so far unsuccessfully.

Railway station in Skopje

A train station in Skopje, the Macedonian capital. Photo credit: Phil Richards.


Of the more than thirty tapes leaked so far, one has dealt specifically with the details of negotiations between representatives of the Macedonian government and China. A Chinese SOE’s bid for a construction contract for two highways in Macedonia, the most significant Chinese project in the country in recent years, revealed a politically controversial arrangement that went beyond standard procedures for deals, including the prospect of enacting a special law that even government ministers deemed illegal. In addition, the tape reveals discrepancies between the costs cited by officials and the project budget listed online (later removed from the webpage of the contractor, Sinohydro). Most importantly, it provides evidence that Gruevski sought financial provisions in the contract.

The revelation of this potential corruption scandal occurred at an unfortunate time, when China finds itself in the third year of its largest anti-corruption campaign in decades, one of the trademarks Xi Jinping’s rule. The overseas projects of SOEs are not immune to scrutiny.[5] Whereas Chinese media has remained relatively silent about the Macedonian highway contract, the case has attracted international attention. Sinohydro and its mother company, China Power Construction Corporation, have been previously involved in similar controversies.[6] According to information from the Macedonian Central Registry of Information, the chairperson of the local branch of Sinohydro was recently replaced; however, the reasons and details regarding this personnel change are unknown.

This scandal also has the potential to impact politics in the region overall. In the Macedonian case, the nature of the allegations represents a serious threat to China’s reputation and its investment plans: first, by potentially circumventing standard legal procedures, a process that also affects the “Europeanization” of Macedonian legislation and practices; and second, by potentially paying off a discredited, delegitimized leadership that is growing unpopular, particularly in the West. A number of Western media engage in ‘China-bashing’ discourse, and such cases provide them with ample opportunities to do so. Such attacks might also be supported by local and foreign companies and bidders who feel threatened by the penetration of Chinese investment and business in the region.

In addition to the scandal involving leaked tapes and its threats to China’s image and appeal, Beijing must now brace itself for uncertainty, instability, and incapacitation of the Macedonian government in negotiating or implementing any joint project during a time of crisis. China has no problem dealing with leaders of different ideological backgrounds, but it is certainly cautious towards political risks when dealing with unstable regimes.

More importantly, after the events in Kumanovo, the Macedonian crisis, though not interethnic in nature, is increasingly seen as having the potential to awaken interethnic tensions of the past. In addition, the inability of Macedonia’s government to properly cope with other issues, such as the refugee crisis, also increases the political risk. All of this dampens the enthusiasm of Chinese foreign policy makers, who have long avoided the Balkans precisely because of unpredictable regional dynamics, high political risks and the potential for destabilization. The best bet for Beijing now is to wait and see when and how the crisis settles down. A pro-European, reformist, and efficient government, and a solution sought by other parties and stakeholders in the process, would certainly serve Chinese interests as well. In this, China should coordinate with its European partners and demonstrate a constructive approach that will help restore stability in Macedonia, facilitating regional cooperation, and getting the European agenda in the Balkans back on track. A new democratic, progressive government in Skopje can restore Sino-Macedonian ties and help realize the full potential of the New Silk Road Initiative in the region.


Anastas Vangeli is a doctoral researcher at the Graduate School for Social Research at the Polish Academy of Science, Warsaw, and a Claussen-Simon PhD Fellow at the Trajectories of Change Program at the ZEIT-Stiftung Ebelin und Gerd Bucerius, Hamburg. His research interests include non-democratic and illiberal diffusion, (post)communist politics, and the relations between China and Eastern Europe.


This article is part of our feature Re-imagining the Silk Road.







No Comments

No Comments Yet!

No one has left a comment for this post yet!

Write a Comment

Your email address will not be published. Required fields are marked *