China’s pledge to end overseas coal support yields mixed results in Serbia and Bosnia

(China Dialogue, 4 Feb 2022) Western Balkans nations may see their energy transitions accelerate after President Xi’s call to support low-carbon energy.

The future of a 700 megawatt (MW) coal-fired power plant in Bosnia and Herzegovina is uncertain after it was unable to secure financing from Chinese banks.

“This is the first time the Chinese commitment to exit from overseas coal has been applied retroactively to a project announced before Xi Jinping made his pledge in September 2021. And it opens a realm of possibilities to move away from other coal projects in the Western Balkans,” said Wawa Wang, director of Just Finance, an NGO advocating for transparency in public financing. “But Chinese banks’ refusal to provide financing for the Ugljevik III project is not enough.”

The expansion of Ugljevik III, which is located in Republika Srpska (one of the two entities of Bosnia and Herzegovina), has been on the cards since 2013, when Russian-owned Comsar Energy was granted the concession for it. In June 2021, the China National Electric Engineering Company (CNEEC) and Sunningwell International Ltd, a company registered in Poland, signed a contract to construct the plant.

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China Dialogue, 4 Feb 2022: China’s pledge to end overseas coal support yields mixed results in Serbia and Bosnia