Romania exemplifies why China is having trouble in Eastern Europe.

Bucharest has a significantly more assertive posture against China than most Western European countries, and Romania barred Chinese enterprises from key industries such as nuclear power and telecommunications. Still, it also delivered a stinging diplomatic rebuke to Chinese President Xi Jinping last month when it refused to send its president to a historic summit despite Beijing’s admonition.

Xi has made Eastern Europe a strategic priority. He is attempting to gain clout in the region by pledging investments through the Belt and Road Initiative, a massive infrastructure project that connects Asia and Europe. On the other hand, Beijing isn’t the region’s top strategic concern. Romania and the Baltic states are much more concerned with Russia. Their ultimate objective is to show their allegiance to NATO and Washington, which they regard as the true regional policemen.

Romania’s dislike for communist China’s diplomatic bullying stems partly from memories of how Soviet Moscow conducted business and how Russia continues to do so. “They look to be trying to force their model on us,” one high-ranking Romanian political official who regularly monitors relations with Beijing said. “The Chinese have demonstrated the same aggressive behavior as Russia.”

According to Deputy Prime Minister Dan Barna, the basic pillars of Romanian foreign policy are “the EU, NATO, and the strategic cooperation with the United States.”

Romania’s maneuverability

Beijing’s hegemony is hurting its Romanian businesses. Last year, a deal with China General Nuclear Power Corporation to replace two reactors at Romania’s nuclear power facility in Cernavodă was scrapped in favor of deals with French and American companies. On security grounds, then-Prime Minister Ludovic Orban blocked Huawei out of the country’s 5G network.

In a similar vein, Romania’s center-right coalition government considers barring foreign corporations, particularly Chinese firms, from receiving state contracts. To speed up the construction of large projects such as highways, it has adopted a memorandum prohibiting operators from non-EU nations that do not have procurement agreements with the bloc.

In an interview with POLITICO last week, Prime Minister Florin Cîţu remarked, “We are skeptical of enterprises that profit from direct or indirect subsidies from their home country and unfair competitive advantage.” “I can’t have such companies making bids and obtaining contracts, whether from China or elsewhere.”

Barna maintained that the memorandum was not directed at China but reflected “enormous social pressure in Romania to ensure our infrastructure plans are implemented.” He claims that Chinese and other non-EU companies have a bad reputation in Romania because they underbid the competition on contracts but subsequently fail to execute on projects due to a lack of acceptable regulatory qualifications or resources in Romania.

According to Barna, the administration will file an emergency motion to enact the memorandum into legislation in the coming weeks. “There is also an element of unfair competition from Asian corporations that are not subject to the same state aid regulations as European companies,” he added.

As the country pours billions into new highways, Romania’s protectionist stance on lucrative construction contracts would benefit well-connected domestic enterprises. Still, numerous politicians have claimed that such a move is unavoidable. Romanian officials have accused Chinese corporations of obstructing infrastructure development by challenging tender decisions in court, causing projects to be delayed for years.

Romania’s tough stance on Chinese investment is considerably easier to implement than Germany’s since Bucharest does not have to defend the interests of huge businesses like Volkswagen. The latter has made significant investments in China and may face retaliation.

People familiar with the situation said Bucharest resented Beijing’s direct political pressure when US-China relations were so tense during February’s contentious 17+1 summit with Xi — a diplomatic arrangement in which China meets with 17 Eastern European countries. Chinese authorities are alleged to have warned that if President Klaus Iohannis does not attend, Bucharest’s bilateral relationship with Beijing may suffer. Beijing followed a similar approach to protect Huawei’s interests in the country.

All six nations that refused to send their leaders to a “17+1” conference last month to pay homage to Xi were members of NATO’s Eastern European intake in 2004.

When asked about relations with China, a spokeswoman for the foreign ministry stated the two countries’ relationship was “based on pragmatism.” She echoed Barna’s words about the importance of relations with the EU, NATO, and the United States, emphasizing Romania’s “commitment to democratic ideals and multilateralism founded on international law, international customs, and human rights respect.”

When asked about China’s human rights record, Cîţu declined to discuss “particular instances,” but he voiced concern about political persecution. “Anywhere globally, brutal governmental action should be denounced,” he remarked. “As long as people act politely and peacefully, they should have a voice.”

The foreign ministry spokeswoman asked for “mutual respect, transparency, respect for the free market and fair competition principles, and reciprocity in all sectors” in commercial interactions with China. We’re particularly interested in a well-balanced trade relationship, which includes more Romanian agri-food exports to China.”

According to a Romanian political insider briefed on the matter, Washington is not providing Bucharest with specific instructions on how to conduct relations with China. Still, Romania wants to “make a statement” about its allegiances.

Military connections with the United States are critical in this situation. Romania has had a tense relationship with Russia for a long time, accusing it of supporting internet disinformation campaigns and invading its airspace over the Black Sea. From the Mihail Kogălniceanu base near Constanța, a NATO air force consisting of British, American, and Italian pilots patrols Romania’s eastern border.

“Romania does not wish to have any hostile relationships with anyone.” On the other hand, it is crystal evident that we have strategic cooperation with the United States,” said Valentin Naumescu, a former diplomat and professor of international affairs at Babeş-Bolyai University Cluj-Napoca.

“Some political and economic decisions involving extremely sensitive infrastructure projects require strategic considerations. That is not to say that we will not collaborate with China on certain economic and commercial issues. Still, we must ensure that they do not lead to a rise in the communist dictatorship in Beijing’s strategic influence in Bucharest to the point where it generates dependence.”