Portugal’s foreign minister Augusto Santos Silva has denied that Portugal has become China’s ‘special friend’ in the EU.
In interview with Peter Wise, the Financial Times correspondent in Lisbon, he “rejected the idea that his country is developing a problematic reliance on Beijing” as Chinese companies are expected to bid to invest in the strategic Sines port project (click here).
Indeed, Santos Silva went so far as to call the notion “a myth that makes no sense at all”, despite the fact that Portugal is one of Europe’s largest per capita recipients of Chinese investment.
The FT stressed that Chinese groups are now the biggest single shareholders in Portugal’s leading power and national grid utilities, while other Chinese investors control Portugal’s largest insurer, a private hospital group and the country’s largest listed bank.
But according to Santos Silva, this is not the way to look at things.
He told the FT that “measuring the relative scale of Beijing’s investment on a per capita basis was a way to devalue the fact that Chinese investment in Europe (in absolute terms) is massively concentrated in the big countries like the UK, Germany and France, among others”.
Lisbon remains keen to (continue to) attract Chinese investment, expand trade and encourage tourism, he told the paper – elaborating that the main focus of this new Socialist administration is to expand Portuguese exports to China and encourage Chinese investors to set up industrial companies here, “particularly in the automobile and electric mobility sectors”.
Chinese shareholders in Portuguese companies have provided “stability and development”, said Santos Silva, while complying “strictly with European and local laws”.
Again, Santos Silva returned to the controversy surrounding Chinese telecoms company Huawei, and repeated warnings from the United States about security risks (click here).
Lisbon has no plans to curtail the Portuguese operations of Huawei, he told Peter Wise, who recalled PM António Costa’s stance last year that Europe was in danger of becoming protectionist in its attitudes towards Chinese investment (click here).
But perhaps the real focus of the interview was the upcoming Sines port project which will require an investment of over €640 million.
Explains Wise, “Sines, the closest European port to the Panama Canal is seen as a hub that could play an important role in the Belt and Road Initiative, China’s contentious infrastructure-building plan which has raised concerns in Europe about Beijing gaining influence over strategically important assets”.
Ruling PS Socialists signed a memorandum of understanding with Beijing in December 2018 (click here), and it’s no secret that China has its eyes firmly on Sines.
But Santos Silva did push the fact that Portugal is hoping for credible bids from the United States and other European companies when the international tender opens later this year.
In other words, Portugal is saying if the international community doesn’t like how much China is becoming involved in Europe, it can always step in with more money.
As the head of diplomacy recalled “the only reasonable proposals” for utilities that had to be privatised nine years ago as a result of Portugal’s massive IMF/ EU bailout came from Chinese State companies.