Hello everybody. I'm David Tweed. I'm a government reporter of Boomberg here in Hong Kong. And with me is Tom mackenzie, who's just completed the fourth of our series on the Belton Road Initiative. And this is a series that actually looks very closely the Belton Road Initiative and how it's doing in Europe. And I have to say it's got some mega personalities on it. It's a really good looking program.
And you started Athens, Tom, I was particularly interested in in in how China apparently describes prayer support in Athens as a dragon's head. What what what is that all about? Yeah, I'm never short of colorful phrasing the Chinese when it comes to things like this, they say, and they've just drived as being a link for their overland and maritime routes that of course are the Belton Road Initiative, and they are very proud of the operations that they have
in place in careers. It is run now by Costco, China's majing major shipping arm and they run it and have done in the last few years. They took over the concession in fully running this port and they've had quite a lot of success. In fact, they've recently reported their profits for the first half of the year that
we're up around from the last time in seventeen. So they see it as as a as a key test that they can show an example, a case study they can show to others of success in terms of their ability to take over a port and make it work and integrated into their Belt and Road initiative, and and and so tell us what's the response been like on the ground to this, What do the Greek businesses think? Well,
that was interesting. We we went there and we spent some time in and around Peireers, which is a fairly deprived part of Athens, and we were expecting to find people, their businesses and residents who had issues with the Chinese
running of this port. There had initially been some complaints, particularly from the unions, when China and Costco took over the running of the port, But in fact what we found was, I guess you could describe it as a kind of reluctant acceptance amongst businesses there, that in fact the Chinese were running it very well, that it had increased trade flows, that careers have benefited from that, and that their benefits that their benners businesses were benefiting from
it as well, and they were looking to take advantage of the opportunities. There are still concerns and those were voiced by some of the business leaders that we met there around whether or not Chinese firms are going to start to eat up some of the opportunities, particularly around the logistics side of the business that spin off from the broader port. But generally the sentiment that we got was was positive. Johmmy Tom, what about in terms of
employing locals at the port? Are there are there more people being employed? Well? This was a key question when Costco took over the running up press, and it was a key concern of course for the unions as well. When we went there, all the workers on the ground, all the workers using the Falklick lift trucks shifting the cargo off these huge tankers, they were all Greek. And you go into the main office where the head of
the ports sits with his Greek counterparts. The managers are Chinese, but they work alongside Greek management as well, and you know, you've got the Chinese flag flying, the Greek flag flying. You got pictures of the Great Wall of Chinese got pictures of the aproperlex next to each other, so they would say this is a really good example of the
two sides working together. So they are continuing to the majority of employees there are Greek in short answer, and they've been adding headcounts as the ports operations have grown, though of course automation is playing an increasing role in
his port, as it is in ports all over the world. Well, yeah, I thought it was interesting actually that you mentioned and we actually saw you had an interview with the Chinese manager of the port, because in some of our other programs, particularly in the in the one in East Africa, the Chinese actually were very careful not to be sort of shown on the screen. But in this case you you you spoke to the to the manager, what was his take?
I think you're right. I think it points to a level of confidence in their operations there they open their door to us. We spent time, as you say, talking to the manager Young and Ming. We got access pretty good access to the board and its operations, which again I think shows that they are at least trying to be transparent and are confident and relaxed about bringing foreign
journalists in to poke around a bit. He said that, look, we're benefiting more broadly from the from the Belton Road initiative. He said that we didn't and they are not getting funds direct financing from the central government for this as part of this initiative. But they're benefiting because of the thick up and pick up in trade flows, and that
they're working to expand the operations there. They've got the container terminal, they've also got the car to comin on and a ship repairs part of the business as well that they're investing in. So they continue to increase investment in the ports and they continue to see opportunities there. On the other place that you you went, well, one of the other places you went to look like you traveled all over over all over Europe. It looked lovely.
Actually in the middle of the summer, I can't think of anything more pleasant, although here it was pretty hot. But one of the other places you went was Duisburg, right, another town, a German town, which is looks to be benefiting from the entire initiative. Right, Yeah, again, this is this kind of forlorn China, I should say, this is the kind of forlorn German city. That was once a part of the industrial economy there, so cole and steel was really the driving force of the economy of Louisburg
a couple of decades ago. That of course, has all changed. There's pretty high levels of unemployment there and the economy has struggled in recent years. But certainly the port there, which is the largest overland port in Europe, and the access the connections to China and Chinese trade flows have
helped to change the prospects for the city. There are still problems there, but they are seeing a take up in trains coming from cities like chong Ching and Evil in China, bringing those goods, particularly I T equipment, computers, laptops, that kind of thing, as well as clothes and toys, bringing it into Duisburg and then funneling it out to
the rest of the European Union and the town. Your metrics was, I think you said there was thirty trains a weaker arriving and that's going to rise to fifty by twenties, so it deserved significant growth. I suppose. Yeah. I mean, look, someone say that that's an overly ambitious target, but the numbers now are around thirty, and yes, they've they've signaled they want to get it up to fifty. There's an element of caution around that number for various reasons.
They also want to cut down the time as well, that it takes currently takes about twelve days to go from a city like chong Ching to Duisburg, and they want to cut that town, of course, because it makes in a more attractive proposition. They're trying to position themselves between between freight overseas freight and airline freight. So that's the proposition they're aiming for. Tom, you were also in Brussels, Um, what does the EU stance on this b r I initiative.
I mean, are they concerned about the geopolitical implications, Yes, I think those concerns frankly there. And the concerns that they really push at this point at this stage are concerns around transparency the bidding process of these Belton Road initiatives, around sustainability, financial sustainability, fiscal sustainability, the environment as well environmental sustainability. These are all issues they say that simply are lacking in terms of being baked into Belton Row projects.
They say that they they want to be involved from the European perspective. But China needs to do a better job of baking some of these these norms into this initiative in order for the European Union to really get on board. And is there some document or anything that the European Union actually needs to approve or to sign off on in order to for disintegration to deepen, Well,
there was. There was a Belton Road summit held in Beijing, the first one last year, and the Chinese made an effort to try to strong arm the Europeans into signing off on the Belton Road initiative, and the Europeans pushed back pretty strongly, and it caused something of a something of a something of a sore point, or at least a point of tension between the two sides, because simply these these pledges around again around the bidding process and
around environmental standards and economic standards and fiscal stands weren't there as far as the Europeans were concerned. So they haven't signed onto it um and that the Chinese would dearly love them to do that. We are still it seems a fair distance away from that happening. The Europeans
are put forward their own proposals around infrastructure. They've got a connectivity plan that they help will be will be able to be in addition to, or will complement the Belton Road initiative, and they want the Chinese to embrace that. So that's kind of where we're at at this stage. If the two sides can come together and if you can have that connectivity plan that the Europeans have afford baked into the Belton Road initiative, then you're going to
see much more enthusiasm from the Europeans. The geopolitical there was a case another set of concerns Tom There was a case recently or was it last year, and it was a case of Greece and I think another country, was it Hungary? Was that that had had had voted against um some decision that needed unanimity on the European Union.
Is there still a sense that China we'll trying to attempt to peel off just one country, like we've sort of seen with China's approach to the South China, see where it gets in the way of as you end unity by pressuring loud or Cambodia not to sign up two statements that need unanimity. Is is there a concern about that strategy playing out in in the European Union. Yeah, there is that concern, and we spoke to Paul Henley
from the Carnegie E. Tinghai Institute. He's a former member of the National Security Council for the White House in Washington.
We spoke to also Foncois Gourdemore from the European Council on Foreign Relations, and they both pointed to this concern that China was using this dividing conquer approach visa v. The Belton Road, and it's just visa its investments in Europe and particularly trying to leverage those investments when it comes to countries that need that fiscal support, so countries like Greece and Hungry, and you pointed to that example.
There was an example as well of the European Union trying to put out a statement in relation to the South China Sea and the Greeks and Hungarians watering that statement down, and that was seen as an example of China's leverage in that regard. So that is a concern as well, clearly amongst the Europeans. Now you spoke to Joe Kaiser, who is the chief executive of Siemens, which is uh, you know, Siemens has been investing in having business in China since at first exported a power generation
a hundred and fifty years ago or something. Um. So what did Joe Kaiser did? Did he did he respond to any of these sorts of concerns about transparency that the European Union has? He did? He said, I put it to him. You know, you're at risk of tarnishing the brand, the Siemens brand by associating yourself with companies with state owned enterprises and initiatives that don't have the same levels of corporate governance and transparency that maybe a
company like Siemens does. And he pushed back on that said, look, we simply will not work on projects where there are concerns around graft for example, or where the bidding process hasn't been transparent. But effectively, his point was, this is such a vast project, um and you know you can take issue with it, but it is going to happen and you need to get involved and steer it in
the right direction. He said, A company like Seems can bring our expertise, as he would say, to the table and help to shape these projects so that they meet the norms that the Europeans, but others like the US
and Australians want to see as well. So that was his position, as he certainly sees it as obviously an opportunity of seems at a time when the business is struggling in some areas, and he said it could end up replacing the w t O. And I don't think it's a fairly strong statement from him, but he was saying. You know, his point really was if you don't get on board, then you risk missing out on this opportunity there's involving ninety countries, as he put it in about
the world's population. Yeah, that comment that he had about the b r I eventually or partially possibly replacing the w t O very very interesting. But also look, I was more interested in the fact that you actually got him on a factory floor. How did you get him out of his offers? Well, I think that goes to show the extent to which Siemens wants to be affiliated with this initiative. That we obviously contacted them so would do this show on the Belton Road initiatives. They said,
we're fine, we want to be involved. They've got an office in Beijing dedicated to the Belton Road initiative. They've signed something like ten memorians of understanding. They really want to be a leading force from the corporate side in in this initiative and in shaping some of these some of the opportunities, and they think that they can bring
a lot to play. So that's that's I think an example of just their willingness to show that they are signing up to this even if the European Union itself isn't. So got him inside one of these massive turbine factories where they design and build and put together some of these huge turbines, and we and you know, he gave a pretty forthright set of views on the implications of this initiative, which he said is are not perfect. It is not perfect, he said, but the idea of ignoring
it is is not something that should be should be considered. Well, I think that anecdote that you just told about how Siemens has got an office not dedicated to Belton Road in Beijing pretty much shows ex actly what European business thinks about the whole initiative and how seriously they're taking it. Tom. Thank you very much, um and and everyone you know, thanks for listening. It's been a great series. I'm David Tweed in Hong Kong. I've been speaking with Tom mackenzie and Beijing