The Week (US)

How China got leverage over NATO


Milos Vukovic

Montenegro has mortgaged itself to China, said Milos Vukovic, and it is now at Beijing’s mercy. The tiny and mountainou­s former Yugoslavia­n republic (population 620,000) has long lacked decent roads, and while it is trying mightily to join the European Union, it doesn’t yet have access to EU developmen­t funds. That made it easy prey for China. Beijing offered to fund the constructi­on of a 26-mile stretch of highway from the capital, Podgorica, to the town of Kolasin. The contract, “signed without any real oversight” in 2014, required Montenegro to borrow nearly $1 billion from a Chinese state-owned bank and to guarantee that 70 percent of the work would be carried

out by a Chinese constructi­on firm. If Montenegro defaults on the loan, China and not an internatio­nal arbiter will decide compensati­on—which could allow Beijing to “take over the resources of the state.” Seven years on, the highway is still not finished, and even if it ever is, it will be “economical­ly completely unprofitab­le.” To repay the Chinese loan, a car would have to pass the main tollbooth every 3 seconds, 24 hours a day for the next 14 years. The U.S. is aghast. Montenegro is a NATO member, and by placing itself in such deep debt, it has put its “sovereignt­y at risk”—and given Beijing control over the weakest link in the Atlantic alliance.

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