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Czech’s Republic deteriorating ties with China over Beijing’s aggressive policies

July 11, 2023
in Business
Czech’s Republic deteriorating ties with China over Beijing’s aggressive policies
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Synopsis

The Czech Republic has approved a new security strategy, identifying China as a systemic rival, thereby reflecting the country’s waning interest in China. This change comes after former President Milos Zeman and previous governments actively encouraged closer ties with both countries, while the current government supports Ukraine.

Czech Republic's Prime Minister Petr Fiala arrives for the second day of a meeting of the European Council at The Europa Building in Brussels on June 30, 2023.  (Photo by Ludovic MARIN / AFP)AFPCzech Republic’s Prime Minister Petr Fiala

Czech, a key economy in Central Europe, seems to be losing interest in China. The Czech cabinet recently approved a new security strategy which described China a systemic rival. The development is a reflection of the end of a period of peace and stability in Europe seen since the end of the Cold War.

In fact, Czech-China relations have witnessed significant changes since 2021. While once characterized by enthusiasm and economic potential, the Czech Republic now appears to be losing interest in its ties with China. The Czech Republic put relations with China under review after the Czech Prime Minister Petr Fiala’s government took office in late 2021. The previous governments and former President Milos Zeman courted closer relations with both.

After the Ukraine war, the current centre- right government supported Kyiv by shipping military equipment including tanks, and has been one of its most active western backers. In the new security strategy statement, Czech government focussed on China alleging that China is calling into question the international order. This has adverse implications for Euro-Atlantic security, the document stated and accused China of weakening the influence and unity of democratic countries.

Czech’s previous security strategy, the core for policymaking, from 2015 had no mention of China. Czech diplomatic relations started becoming strained after Czech parliamentary leaders and the current cabinet pursued closer ties with Taiwan.

Czech republic also got frustrated with China after plans for major Chinese investments failed to materialise. The security strategy also warned against the risk from Chinese investments into Czech and European critical infrastructure, dominance in strategic supply chains, control of key commodities and development of emerging and groundbreaking technologies, mainly artificial intelligence outside ethical norms and international standards.

In fact, in Czech Republic planned to make an exit from China’s 16+1 investment platform for Central and Eastern Europe (CEE) in June 2022. China has lodged diplomatic protests against the Czech Republic when its officials engage in activities or make statements that China considers a violation of the One-China policy.

China had strongly objected to the visit of the Czech Senate Speaker, Milos Vystrcil, to Taiwan in 2020. China denounced the visit and warned of potential consequences for Czech-China relations.

After Czech government decided to establish a sister city relationship with Taipei in 2020 , Chinese state-owned company, CEFC China Energy, cancelled its planned acquisition of a 49 per cent stake in the Czech airline. Some Czech companies have also reported facing difficulties or delays in their business dealings with China after engaging in actions perceived as unfavourable by the Chinese government.

The cyber attacks in Czech Republic were attributed to Chinese state-sponsored actors. In 2018, the Czech Security Intelligence Service (BIS) had issued a warning about cyber threats originating from China targeting Czech government institutions and critical infrastructure. These attacks were seen as a response to the Czech government’s decision to cancel a sister city agreement with Beijing.

Available reports indicated that China has exerted diplomatic pressure on the Czech Republic to conform to its preferred policies and positions. This pressure can manifest through diplomatic statements, public criticism, and warnings about potential negative consequences for bilateral relations.

Also there have been reports of disinformation campaigns originating from China aimed at shaping public opinion and influencing Czech discourse on issues related to China. These campaigns often seek to discredit individuals, organizations, or actions that China perceives as being critical of its policies or interests.

The Czech Republic has shown an interest in developing ties with Taiwan in the field of microchips and semiconductors. The global shortage of semiconductors in recent years has highlighted the importance of secure and reliable supply chains for these critical components, and the Czech Republic sees Taiwan as a potential partner in this area.

It is beyond doubt that Taiwan is renowned for its advanced semiconductor industry, with companies such as TSMC (Taiwan Semiconductor Manufacturing Company) being global leaders in chip manufacturing. The Czech Republic recognizes the need to diversify its sources of microchips and semiconductors to reduce dependency on a single supplier, and Taiwan presents an attractive option due to its technological expertise and reputation for high-quality production.

Czech companies have shown interest in collaborating with Taiwanese counterparts in the semiconductor industry. Czech carmaker Skoda Auto has reportedly sought partnerships with Taiwanese chipmakers to secure a stable supply of semiconductors for its production.

(Catch all the Business News, Breaking News Events and Latest News Updates on The Economic Times.)

Download The Economic Times News App to get Daily Market Updates & Live Business News.

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