Chinese investments in Italy, Pakistan and South Korea
Chinese companies are investing in South Korea’s battery industry to enter the US market. In this way, they are trying to circumvent the efforts of the administration of US President Joe Biden to limit China’s involvement in the supply chain of electric car parts. Chinese and South Korean companies want to take advantage of the tax credits in South Korea’s free trade agreement with the US. Over the last four months, the Chinese and the Koreans have announced investments worth about $4 billion in five new battery factories in South Korea.
Over the past ten years, China has invested $25.4 billion in Pakistani projects, including roads, ports and power plants. These countries have just celebrated the 10th anniversary of cooperation within the framework of the Belt and Road Initiative (BRI), a global effort by the Chinese authorities to restore ancient trade routes and connect China with all parts of Asia. Thousands of Chinese construction workers and engineers have been working in Pakistan since 2013, and China has just given Pakistani authorities another $2.4 billion loan to help their economy.
According to the Italian defence minister, joining the Belt and Road Initiative (BRI) was his country’s “fatal” decision. It did little to boost exports to China, while Chinese exports to Italy surged. Italy joined the BRI in 2019 as the only major representative of Western countries. The local authorities are considering breaking this agreement without compromising relations with China.