China: Beijing's Investment in Europe Reveals Long-Term Strategy

China is making inroads into Central and Eastern Europe. In recent years, as the crisis in the European Union bears down on Western Europe's economic vitality, the capacity to fund and invest in peripheral regions like the Balkans and Baltics has waned. As a result these countries have begun to seek supplemental sources of capital, technology and trade. The countries of Central and Eastern Europe are looking to develop low-level commercial ties outside their immediate neighborhood in order to reduce their near-total reliance on Russia and the EU.

Chinese investment in Central and Eastern Europe is sure to grow in the coming years, but will be constrained both by logistical and political-administrative factors, as well as the region's basic geopolitical reality. In the near term, China looks to Central and Eastern Europe primarily as a market for its own strategic industries and perhaps another window into Western European markets. In the long term, it may seek to utilize rail and other infrastructure investments into the region to build more integrated trans-Eurasian transport systems.