How China’s ‘Gateway to Europe’ Began to Narrow

The decoupling of Chinese and local interests, according to Mr. Hala, the Prague-based China scholar, began with the realization that Chinese investment was “not just free money falling from the sky.”

In the Czech Republic, this became clear in 2018, when CEFC China Energy, which had spent more than $1 billion on deals in the country, began to implode after the arrest in China of its boss, Ye Jianming, a special economic adviser to Mr. Zeman.

Beijing’s fortunes suffered a further setback in 2021, when Petr Kellner, a Czech tycoon with extensive business interests in China, was killed in a helicopter accident. His company, PPF, has since announced that it wants to sell its flagship China business, a financial institution called Home Credit, and make Europe its “center of gravity.”

The stalled real estate and spa project in South Moravia, based in Pasohlavky, a village of around 700 people near the border with Austria, was part of the boom that went bust.

It first took shape after the signing of a 2016 “framework” agreement between South Moravia and the Chinese Development Bank, a state lender tasked with bankrolling infrastructure and other projects linked to China’s Belt and Road initiative.

Mr. Hasek, then the region’s governor, promised that the agreement would bring in Chinese companies ready to invest hundreds of millions of dollars. That, said South Moravia’s current governor, Jan Grolich, never happened: “He promised lots of Chinese money, but reality has been absolutely different.”

Today, Mr. Grolich noted, the only Chinese investment project in the region is the stalled RiseSun venture in Pasohlavky. “There is nothing else,” he said.

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