North Macedonia

North Macedonia

Sino-Macedonian relations have accelerated since the early 2010s, especially after the unveiling of the Belt and Road Initiative (BRI). Two significant infrastructure projects in the country carry the BRI stamp, but both have been marred by significant controversies related to lack of transparency, corruption, cost overruns and delays, and environmental problems.

North Macedonia

Written by Anastas Vangeli.

Background

China has historically had sympathies for the Macedonian state in its quest for international recognition. During the Yugoslav–Chinese rapprochement (following decades of tense relations between Beijing and Belgrade), China’s paramount leader Hua Guofeng visited Skopje, the capital of the Socialist Republic of Macedonia, in 1978. On that occasion, he gave a speech in front of a mass audience, expressing firm support for the official Yugoslav and Macedonian position in the identity struggles with Soviet-backed Bulgaria regarding the ‘Macedonian question’—that is, a set of historical disputes related to the identity, heritage, and borders of Macedonia. In 1991, in the aftermath of the dissolution of Yugoslavia, China recognised the independence of the Macedonian state under its constitutional name, the Republic of Macedonia (which was contested by Greece)—a position China held until 2018, when the country changed its name to North Macedonia.

The cordial but rather uneventful Sino-Macedonian relationship of the 1990s faced an abrupt disruption on 27 January 1999, when, without prior announcement, representatives of the Macedonian Government travelled to Taipei to establish official diplomatic relations with Taiwan, announcing a major economic partnership. China retaliated by cutting ties with Macedonia and vetoing the extension of the UN peacekeeping mission at the Macedonian–Kosovar border in the UN Security Council. NATO forces took over border protection duties. In 2001, North Macedonia experienced an armed conflict that lasted seven months. Ethnic Albanian paramilitary units, led by veterans from Kosovo, attacked Macedonian security forces and occupied parts of the territory. The conflict ended in August 2001, with the Ohrid Framework Agreement. In the meantime, the economic partnership with Taiwan never materialised. Relations between the People’s Republic of China and North Macedonia remained suspended until the summer of 2001, when a new interim government in Skopje withdrew the recognition of Taipei and normalised bilateral relations with Mainland China. The foundations of the new relationship between North Macedonia and China included reciprocal recognition of the territorial integrity and unitary character of both states, as well as a common commitment to fighting global terrorism.

Sino-Macedonian relations have accelerated since China established a platform for relations with Central, Eastern, and southeastern Europe (the so-called 16+1; later renamed 17+1 when Greece joined) in 2011–12, and especially after the unveiling of the Belt and Road Initiative (BRI) in 2013. The peak of relations was the period 2012–14. As of 2015, North Macedonia entered a tumultuous political crisis, which has made policymakers look inward and particularly wary of expanding relations with non-Western actors. Consequently, relations with China were marginalised until the COVID-19 pandemic, when China emerged as an important source of personal protective equipment (PPE) and a major supplier of vaccines. Recent disappointments with the lack of progress in the EU accession process have prompted the North Macedonian Prime Minister Zoran Zaev (in office since 2017, with a brief interruption in 2020) to publicly contemplate closer cooperation with China.

BRI Status

In 2015, North Macedonia signed the Memorandum of Understanding on Jointly Building the Silk Road Economic Belt and has since been ceremonially participating in BRI events. North Macedonia is actively involved in the China-led platform for relations with the Central and Eastern European Countries (CEEC), also known as 16(17)+1, which nominally pre-dates the BRI, but in practice has served as a regional vehicle for its advancement. North Macedonia has been the home of the China–CEEC Coordination Centre for Cultural Cooperation since 2017, and hosted the China–CEEC High-Level Think Tanks Symposium in 2018. There are two significant infrastructure projects in the country that carry the BRI stamp: the Štip–Miladinovci Highway (completed) and the Kičevo–Ohrid Highway (under construction).

The BRI in North Macedonia overlaps with other endeavours for regional connectivity. North Macedonia borders three countries that are strategic partners of China—Serbia, Bulgaria, and Greece—and is part of a key BRI project in Europe, the Europe–China Land–Sea Express Route, which aims to connect Athens and Budapest.

Cooperation with China is seen as a secondary option for North Macedonia, as the country has pronounced a pro-Western orientation in global affairs. According to the official rhetoric, the BRI in North Macedonia is aimed at complementing the country’s accession to the European Union. The European Union, however, has reservations and has taken significant measures to offset China’s perceived increased influence in the country. The United States has also cited China’s economic diplomacy as a threat to the region. Yet, as North Macedonia is significantly lagging in terms of economic development and struggling to catch up with other EU economies, economic cooperation with China is still viewed with cautious optimism by the North Macedonian Government.

Economic Relations

Trade: Substantial and coordinated Sino-Macedonian commercial relations commenced only in 1995, with a bilateral agreement on trade and economic cooperation. The entrance of both countries to the World Trade Organization—China in 2001 and North Macedonia in 2003—accelerated the relationship. In the following decade, economic cooperation was further facilitated with the launch, first, of the China–CEEC platform, which created several new economic cooperation instruments, and then of the BRI.

According to the North Macedonian State Statistics Bureau, North Macedonia’s trade with China in 2019 amounted to around 710 million USD. The bilateral trade is quite unbalanced: China’s exports to North Macedonia were worth 544.9 million USD, whereas North Macedonia’s exports to China amounted to 166.1 million USD. China is still far from the largest of North Macedonia’s trading partners—a position occupied by EU countries and North Macedonia’s Balkan neighbours.

According to the Observatory of Economic Complexity, North Macedonian exports to China mostly comprised raw materials, such as ferro-alloys (68.6%); marble, travertine, and alabaster (19.1%); and dolomite (2.24%). The main imports from China were electrical machinery and equipment (31.3%), machinery and appliances (17.7%), and components and materials used in the textile industry (13.4%).

Investment: For North Macedonian policymakers, China has been a long-desired source of foreign direct investment. However, their desire has never fully materialised. According to the Central and Eastern European Centre for Asian Studies (CEECAS), which combines data from China’s Ministry of Commerce and other sources, as of 2019, there had been only 27 million EUR of foreign direct investment (stock) from China to the country.

Finance: There have been two major infrastructure projects implemented through Chinese loans and contracted to Chinese companies: the 57-kilometre Kičevo–Ohrid Highway and the 47-kilometre Štip–Miladinovci Highway. These projects cost 861 million EUR, or 7% of national GDP. Similar cooperative endeavours were undertaken long before the BRI. For instance, between 1998 and 2004, the Chinese state-owned China International Water & Electric Corporation (CWE) constructed the Kozjak Hydro Power Plant near Skopje, which was financed by Chinese loans.

Aid: China has historically considered North Macedonia an important location for its overseas development endeavours and has provided an undisclosed amount of developmental aid to the country since its independence.

COVID-19: During the first year of the COVID-19 pandemic, China provided health-related aid as well as computer tablets for children to continue schooling online during periods of lockdown. China also enabled the sale of PPE to North Macedonia. In 2021, despite its hesitancy about dealing with non-Western countries, the North Macedonian Government purchased 200,000 doses of the Sinopharm vaccine and ordered 500,000 doses of the SinoVac vaccine. The People’s Liberation Army (PLA) has additionally donated 100,000 Sinopharm doses for the North Macedonian army and police. Several top officials, including Prime Minister Zaev, have received the Sinopharm vaccine. Overall, the healthcare cooperation during the COVID-19 pandemic has significantly improved the image of China in the country.

Key Controversies in Bilateral Relations

Most of the controversies in Sino-Macedonian relations are related to the cooperation in transport infrastructure development. The Kičevo–Ohrid and Štip–Miladinovci highways are two of the largest infrastructure projects in North Macedonia since the country’s independence and a major step towards addressing the country’s significant infrastructure gaps. The tangible economic benefits of the projects notwithstanding, they have been accompanied by significant controversies.

Governance: Both projects mentioned above have been undertaken with favourable loans from the Export–Import Bank of China (China Eximbank) and contracted to Chinese companies—in this case, the Chinese state-owned Sinohydro—for the engineering and construction. Both projects have been governed by a lex specialis (special law), effectively circumventing regulation on public procurement and shielding them from public scrutiny (for more details, see the Kičevo–Ohrid Highway profile).

Corruption: In 2015, as part of a broader anti-government campaign, then opposition leader Zoran Zaev publicly broadcast leaked wiretaps that suggested corruption in the process of contracting to Sinohydro—a situation discussed in more detail in the Kičevo–Ohrid Highway profile. After the change of North Macedonia’s government in 2017, the former Special Prosecutor’s Office proceeded with an investigation into former government officials (including former Prime Minister Nikola Gruevski, in office from 2006 to 2016) for abuse of power in arranging the deal. The statute of limitations for the case has since expired.

Cost Overruns and Delays: Technical difficulties have complicated the construction of the two highways, with the Kičevo–Ohrid Highway particularly affected. While the Štip–Miladinovci Highway was completed in 2019 (two years behind schedule) and is fully functional as of 2021, the Kičevo–Ohrid Highway has been delayed multiple times, with the latest deadline pushed out to 2023 (from the original completion date of 2017). After long negotiations between the North Macedonian Government and Chinese representatives, in 2018, the cost of the project, originally envisaged at 411 million EUR, increased by an additional 187 million EUR.

Environmental Issues: The Kičevo–Ohrid Highway traverses the UNESCO-protected Ohrid region and the natural habitat of the endangered Balkan lynx. There have been concerns about the inadequate environmental standards in the planning and implementation of the project. It is feared that complications during construction, including landslides, will have a negative impact on the environment.

Key Sources

General news on North Macedonia in English can be found on the websites of the news agencies MIA and Meta.

Currently, there is limited debate about China within the North Macedonian academic and think tank community, and in the broader public sphere and media. Information on China mostly consists of translations of global news agency items and other content produced by global media.

Reports on various issues regarding North Macedonia’s politics, economy, society, and external affairs, as well as its relations with China, are published by the China–CEE Institute. More on Sino-Macedonian relations can be found on the website of the China Observers in Central Europe.

Literature on Sino-Macedonian relations, as well as China and the Balkans, includes the following:

  • Gjorgioska, Adela and Anastas Vangeli. 2017. A Battle of Perceptions: The Social Representations of the BRI and the ‘16+1’ in Macedonia. Budapest: China–CEE Institute. Link.
  • Krstinovska, Ana. 2020. The Place of North Macedonia in China’s Strategy for the Western Balkans. Berlin: Konrad-Adenauer-Stiftung. Link.
  • Pavlićević, Dragan. 2019. ‘Structural Power and the China–EU–Western Balkans Triangular Relations.’ Asia Europe Journal 17(4): 453–68.
  • Tsimonis, Konstantinos, Igor Rogelja, Ioana Ciută, Anastasia Frantzeskaki, Elena Nikolovska, and Besjan Pesha. 2020. ‘A Synergy of Failures: Environmental Protection and Chinese Capital in Southeast Europe.’ Journal of Current Chinese Affairs 48(2): 171–200.
  • Tubilewicz, Czeslaw. 2004. ‘Taiwan’s “Macedonian Project”, 1999–2001.’ China Quarterly 179: 782–803.
  • Vangeli, Anastas. 2019. ‘China: A New Geo-Economic Approach to the Balkans.’ In The Western Balkans in the World, edited by Florian Bieber and Nikolaos Tzifakis. New York, NY: Routledge.
Cover Photo: North Macedonia Landscape, (CC) Dejan Krsmanovic.

Updated on 7 October 2021.


Anastas Vangeli is an Assistant Professor at the School of Economics and Business, University of Ljubljana, Slovenia. He is also a Research Fellow at the EU–Asia Institute, ESSCA School of Management, and a Senior Non-Resident Fellow at the ChinaMed Project, Torino World Affairs Institute. Anastas has written on global China, its domestic transformations, and its ideational impact abroad, the Belt and Road Initiative, Europe–China relations (including relations between China and Central, Eastern and southeastern Europe), and nationalism in Europe and beyond.

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