Poland and China signed a “universal strategic partnership agreement” on the first day of a visit by Chinese leader Xi Jinping on June 20.
The agreement comes on top of several smaller deals Polish companies signed with Chinese peers. Like most of its Central & Eastern European neighbours, Poland is pushing to raise relations with China as it eyes Beijings huge investment war chest and seeks to boost trade and reduce its massive trade deficit with the eastern giant.
The value of Polish exports to China was just €1.8bn in 2015, more or less equal to value of Polish sales to Sweden in just one month. Imports from China, however, were worth over €20bn in 2015.
Warsaw is also looking to attract more Chinese investment, which made up only 0.2% of foreign direct investment – worth €391mn - according to 2014 data from the National Bank of Poland. Poland suggested in February that it is eyeing an issue of yuan-denominated bonds to meet interest from Chinese investors. Hungary became the first Central European country to issue a dim sum bond in April.
China, meanwhile, is building an enhanced presence in Poland and other CEE countries as part of its 'Belt and Road Initiative'. In November, Beijing signed a memorandum with Bulgaria, the Czech Republic, Poland, Serbia and Slovakia to promote the initiative, which seeks cooperation among countries throughout Asia, Europe and Africa.
Politically, Beijing is seeking a more favourable climate in the European Union – treating Poland and other CEE countries as a gateway – ahead of the EU’s decision on granting China market economy status. China also hopes to provoke support for its stance on the territorial disputes in the South China Sea, the Polish Institute of International Affairs noted recently.
“I hope that Poland will become China’s veritable gateway to Europe, not only in symbolic but also in economic terms, and that joint investment projects will be launched,” Polish President Andrzej Duda told a press conference following signing of the strategic partnership.
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