Chinese Prime Minister Wen Jiabao said Thursday his country is setting up a $10 billion credit line to support joint projects with Central and East European nations.
Wen said that China would like to invest in infrastructure projects, new technologies and green energy in order to boost business and trade that would benefit both sides. He spoke at the opening of a business forum of hundreds of business people from China and Central Europe.
Wen also pledged to open the Chinese market to goods from Poland and from Central Europe to balance the trade exchange, in which Chinese exports are dominant.
"China will work with countries in Central and Eastern Europe to mutually open the markets and to increase the trade exchange to $100 billion before 2015," Wen said.
In the biggest Chinese investment in the region so far, China's Wanhua Industrial Group has gained full control of Borsodchem, the Hungarian chemicals manufacturer, in a (EURO)1.2 billion ($1.6 billion) deal.
In Serbia, the biggest Chinese investment is a (EURO)170 million ($225 million) bridge over the Danube river in Belgrade. Other projects in the region include construction of car and TV screen factories, as well as food processing plants.
In 2010 the trade exchange was more than $41.1 billion, compared to just $3 billion a decade earlier, according to Central and Eastern Europe Development Institute.
Prime Minister Donald Tusk said Poland is a good place for Chinese investment due to its persistent economic growth, in defiance of a global crisis, and due to its leading role in the region, where some of the countries are European Union members and some are attempting to join the bloc.
Chinese investment in Poland is valued at $120 million ((EURO)90 million), according to the institute, while government figures say that total trade exchange last year was over $19 billion ((EURO)14.5 billion), but only 10 percent of that was Poland's exports to China.
Wen and Tusk stressed the great potential for doing business on both sides and urged companies across the region to seek business partners.
Cai Zhi, director for Poland of a Chinese company specializing in building highway bridges and tunnels for underground city transport, said he hopes that Poland will appreciate the know-how and experience of SUCG International Engineering Co. Ltd., which is based in Shanghai.
"We want to find some opportunity here," he said, nothing that could be a challenge because Polish companies fear lower-priced competition from China.
A large contract with China's COVEC construction company to build part of a highway needed for the June European football championships collapsed last year due to poor cooperation with Polish subcontractors.
But there also are challenges for European companies in the Chinese market.
Andrzej Pawelec of Agrihortus company, who is seeking new partners in China to sell its beverages, said there is a huge market there but that consumers are looking for luxury goods from Europe.
The Chinese are "very pragmatic" in business, Pawelec said. "If they see a good and honest business proposal, they are always open."
AP writers Bela Szandelszky, Karel Janicek, Vadim Ghirda, Dusan Stojanovic and Veselin Toshkov contributed to this report.
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