China Is Increasingly Using Infrastructure as a Tool for Global Leverage
The United States recently initiated construction on two long-awaited high-speed rail (HSR) projects with others being planned.
While high-speed rail networks are well-integrated into the infrastructure of Europe and much of Asia, the U.S. — with a population exceeding 340 million — has yet to see a fully operational HSR line.
The developments signal not simply a new chapter in domestic transportation but an opportunity to reshape the geopolitical balance of infrastructure investment — particularly in countering China’s growing transnational influence.
China is rapidly expanding its high-speed rail network, expecting to reach approximately 60,000 kilometers of track by 2030.
The economic benefits for Chinese cities connected by HSR are clear, with reports showing a 14.2% increase in local economic activity following their integration into the network.
However, China’s ambitions stretch beyond its borders.
Through its Belt and Road Initiative (BRI), Beijing has exported this infrastructure model globally, investing heavily in Asia, Africa, and increasingly, Europe.
These investments are not just economic — they are strategic.
For example, the Budapest-Belgrade Railway is a flagship BRI project that connects Hungary and Serbia over approximately 350 kilometers.
The project, valued at around $2.89 billion, is financed predominantly by Chinese loans and constructed by Chinese companies.
It serves as a crucial link between the Chinese-operated port of Piraeus in Greece and Central Europe.
Nevertheless, the Chinese investments have raised concerns within the European Union (EU) regarding economic dependencies and geopolitical influence.
Reports suggest that Chinese control over critical infrastructure could allow for significant economic and political leverage over the EU and its neighboring countries.
Through these investments, China is gaining soft power in the EU, especially in the Western Balkans.
However, some countries in the region have chosen a different path by serving as a model for Western cooperation in infrastructure development.
Most recently, North Macedonia announced a £5 billion investment alliance with the UK. The British investment will support the development of North Macedonia’s critical infrastructure through a primary focus on investments in rail and cargo infrastructure that will increase regional connectivity and boost trade.
Additionally, the investment will help to refurbish hospitals and improve defense by developing cyber-security capabilities and digital transformation of the North Macedonian government.
North Macedonia’s Deputy Prime Minister and Minister of Transport, Aleksandar Nikoloski, observed that this cooperation has considerable political importance “because we’re partnering with a key Western ally, which shows the government’s policy and Macedonia’s position as a pro-Western country that respects Euro-Atlantic values.”
Similarly, for the UK the partnership stands as a rapprochement to Europe with the landmark investment agreement demonstrating the power of Western alliances in offering meaningful alternatives to Chinese investments — without the strings often attached to BRI projects.
The loans provided by China not only come with high interest rates but also policy constraints, unlike those from European countries or the U.S.
As a result, China’s involvement in European infrastructure projects frequently exposes disparities between the legal and regulatory frameworks of China and the EU, including transparency in tender procedures and working conditions at some Chinese state-owned enterprises.
Cooperation with authoritarian countries can also lead to the exposure of sensitive European data. Serbia, for instance, is using Chinese IT companies and ‘smart city’ solutions as part of its BRI projects.
By contrast, the low-interest loan that North Macedonia will receive from the UK will guarantee finances on terms that North Macedonia’s Prime Minister, Hristijan Mickoski, described as “the best one can have on the market.”
The initiative should serve as a model for broader transatlantic cooperation.
Indeed, North Macedonia is as an example of how countries in the region can partner with Western powers to modernize infrastructure while safeguarding sovereignty.
But to amplify this effect, the United States should follow the UK’s lead and play a more visible and strategic role in European infrastructure development.
While the U.S. has historically focused its infrastructure investments domestically, steps are now being taken to expand America’s reach.
Projects such as the International Development Finance Corporation (DFC.gov) are strategically positioned as a geopolitical tool to offer transparent and sustainable alternatives to Chinese state-backed infrastructure investments.
Furthermore, projects such as the Three Seas Initiative (3seas.eu) are an important step in bolstering the transatlantic cooperation in infrastructure development.
The U.S. has pledged financial and diplomatic support to the Three Seas Initiative, recognizing its potential to enhance regional connectivity through investments in energy, transport, and digital infrastructure.
The initiative not only promotes economic resilience and security but also creates a strategic corridor through which Western standards and practices can prevail.
With China increasingly utilizing infrastructure development as a strategic instrument of geopolitical statecraft, it is imperative that the United States and its European allies formulate a cohesive and forward-looking response.
Infrastructure must be recognized not simply as a matter of physical construction, but as a cornerstone of strategic policy.
In this evolving global landscape, the foundations laid today will shape the contours of international power and influence for generations to come.
Ivan Sascha Sheehan is a professor of Public and International affairs and the associate dean of the College of Public Affairs at the University of Baltimore. Opinions expressed are his own. Follow him on X @ProfSheehan. Read More — Here.
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