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China-Serbia Free Trade Agreement a landmark event of China-CEEC cooperation mechanism Release date: 2024-05-09    Source:CGTN

In October 2023, China and Serbia signed a free trade agreement, the first of its kind between China and a nation from Central and Eastern Europe, set to take effect in the coming months of this year. The China-Serbia Free Trade Agreement is not only a vital measure to implement the consensus reached by the leaders of the two countries but also a landmark event of the China and Central and Eastern European Countries Cooperation (China-CEEC cooperation) mechanism and a pivotal achievement of the third Belt and Road Forum for International Cooperation.

A Solid Foundation for China-Serbia Collaboration

With a foundation of friendship, China and Serbia established a strategic partnership in 2009 and forged a comprehensive strategic partnership in 2016. Furthermore, the comprehensive visa-free regime between the two countries took effect in 2017. Since Serbia joined the China-CEEC cooperation mechanism and the Belt and Road Initiative, high-level interactions between the two sides have been frequent, and cooperation has been intimate, with remarkable results achieved in many fields such as infrastructure, energy, economy, and trade, as well as tourism. Notably, Serbia has emerged as a focal point for many significant investment projects of China in the Central and Eastern European region, and even in Europe. Such projects include the E763 highway project, the Zemun-Borca Bridge project, the Hungary-Serbia railway project, and the acquisition of Smederevo Steel Mill by HBIS Group.

Further Deepening and Solidifying Bilateral Economic and Trade Cooperation

In 2022, China became Serbia's largest source of foreign direct investment. In 2023, bilateral trade surged to $4.35 billion. With the signing of the China-Serbia Free Trade Agreement, both nations will achieve higher levels of goods trade liberalization on the basis of mutual benefits and win-win results. Both sides will mutually cancel tariffs on about 90% of the tariff lines, covering about 95% of bilateral trade volume. Among them, over 60% of the tariff lines will see immediate tariff elimination upon the agreement coming into effect, while other products will gradually transition to zero tariffs. Bilateral trade is bound to witness considerable growth.

China will further boost its exports of advantageous products to Serbia, such as new energy vehicles, photovoltaic components, lithium batteries, and communication equipment. Meanwhile, Serbia's premium products such as beef, wine, nuts, generators, and motors will enter the Chinese market at more favorable prices. Both countries stand to reap mutual benefits and achieve win-win outcomes in economic and trade cooperation.

Enormous Potential for China-Serbia Cooperation

Against the background of some Western countries' calls for "de-risking" toward China, the signing of the China-Serbia Free Trade Agreement is particularly valuable and serves as a European example of the important initiative aimed at fostering an open world economy.

By Chen Siyang, an assistant researcher at the Institute of European Studies of Chinese Academy of Social Sciences