How a Serbian town shows China’s global expansion, US retreat
Chinese purchase of a formerly American-owned steel mill reflects the two superpowers’ changing international focus
A giant Chinese red flag flutters on a pole where an American flag used to fly at a steel mill in this dusty industrial Serbian town. The company logos of US Steel are faded on the huge chimneys stacks, replaced by those of a Chinese company.
When US Steel sold its loss-making smelter in Serbia to the government for the symbolic sum of US$1 in 2012, few here thought the ailing communist-era factory would ever be revived. Then came along a state-owned Chinese company.
Hebei Iron & Steel’s 46 million-euro (US$52 million) purchase of the Steelworks Smederevo last year is part of China’s broader effort to project influence and gain an access point to the European market as other traditional powers, particularly the US under President Donald Trump, retreat from the world stage.
The dynamic was laid bare at a world summit over the weekend where Trump showed little interest in promoting free trade and was at odds with other countries on issues like climate change. China, meanwhile, was keen to promote itself as a champion of commerce and openness – even though in practice it falls far short of being one.
The Serbian plant is economically irrelevant in the short term to China, which abounds with steel production at home. But the deal saved 5,200 local jobs and gained Serbia’s political favour.