Chinese Investors Interested in Ports of Zadar and Rijeka

By 8 June 2018

ZAGREB, June 8, 2018 - Croatia is interested in introducing a direct airline route to China while the Chinese side, aside from the Pelješac Bridge, is interested in the ports of Zadar and Rijeka, a state secretary at the Ministry of Maritime Affairs, Transport and Infrastructure, Tomislav Mihotić, said in an interview with Hina.

The fourth ministerial conference between China and 16 Central and Eastern European Countries (CEEC), held in Ningbo, China, on Thursday, focused on direct cooperation with China, Mihotić told Hina after the conference.

Speaking of the Pelješac Bridge, he said that it was the first EU-funded project won by a Chinese company in a public tender. By winning the contract to build the Pelješac Bridge, China has been given the opportunity to enter the EU market and participate in other major infrastructure projects to be largely financed with EU funds, said Mihotić. "We expect them to start the construction work within 70 days from the signing of the contract," said the state secretary.

The contract on the construction of the Pelješac Bridge, to connect the southern Adriatic peninsula of Pelješac in Dubrovnik-Neretva County with the mainland, and access roads was signed on April 23. The project worth 2.08 billion kuna (not including VAT) was agreed between the Hrvatske Ceste road operator and China Road and Bridge Corporation. 85% of the acceptable costs will be financed with EU funds.

Mihotić noted that the Chinese side was also interested in entering the ownership structure of the Port of Zadar. "In the coming days, the port will sign a co-ownership agreement with the Chinese partners. The port will be a logistical point for China to expand its trade not only to the Croatian market but the European market as well," he said.

The media recently reported that a Chinese investor – according to some reports the Jiangxiong Hua company – planned to enter the ownership structure of the Port of Zadar and that it would initially invest 215 million kuna.

China is also interested in cooperation with the Port of Rijeka, said Mihotić. "We have told them that a tender would soon be published to lease a terminal at the Port of Rijeka," he said, noting that he was confident Chinese companies would be interested.

Croatia has expressed interest in introducing a direct flight to China which, Mihotić said, would contribute to increasing the number of Chinese tourist arrivals. "Other Central and Eastern European countries have shown interest in that as well. We would like it to happen and will try to investigate which companies are interested," said Mihotić.

The China-CEEC ministerial conference was held in the shadow of a possible trade war between the United States and China. "We are worried about a possible trade war between China and the USA. We want to cooperate with both of those large markets so we have to find a way to keep that cooperation going," said Mihotić.

Along with the ministerial conference, Ningbo also hosted CEEC Expo 2018, at which countries from Central and Eastern Europe presented their products and services. Croatian companies presented their products and services on the Chinese market for the fourth consecutive year, and their interest in growing every year, Croatian Chamber of Commerce officials have said.

Ningbo, China's main transport hub, with a well developed system of highways, railways and air and sea transport infrastructure, has a strong industrial base and is one of the first pilot cities in China that promote innovation, research commercialisation and the incubation of small and micro businesses.

By the end of 2017 the city attracted as much as 167 billion dollars of foreign investments, but investments by local businesses are also high.

Ningbo entrepreneurs, who are encouraged to invest abroad, opened 41 companies in Central and Eastern European countries by the end of 2017.

The city has one of the highest rates of trade with CEEC countries among Chinese cities – last year, it amounted to close to 3 billion dollars.

Trade with Croatia is modest. According to official Chinese statistics, in 2017 trade between Ningbo and Croatia totalled 75 million dollars, an increase of 14% from the previous year. Of that amount, imports from Ningbo totalled close to 72 million dollars, 9% more, while exports from Croatia to Ningbo totalled 8 million dollars, 90% more than in 2016.

Croatia imported insecticides, herbicides and similar products, clothing, ornaments and textile fibres the most, and exported to Ningbo cut wood, alcohol, engines and generators.

Mihotić said that Croatia wanted to increase exports to the Chinese market. "At the moment, the Ministry of Agriculture is working to ensure licences for the export of milk and dairy products to China," he said.