China and Serbia have unveiled plans to enact a fresh free trade agreement starting from early July, further solidifying the economic and diplomatic bonds between Belgrade and its largest foreign investor. The agreement, forming part of an extensive partnership dubbed “Shared Future” between Serbia and China, was disclosed during a joint press briefing in Belgrade on Wednesday. Serbian President Aleksandar Vučić and Chinese President Xi Jinping, who is embarking on his first European tour in five years, jointly announced the initiative.

Vučić hailed the agreement as pivotal for Serbia’s future, emphasizing its potential to eliminate tariffs on nearly 95% of the nation’s exports to China over the next five to ten years, encompassing goods ranging from apples to beef.

The timing of the announcement coincides with heightened political tensions between Beijing and the EU, fueled by allegations that China placed a spy within the office of a far-right German MEP. However, the unveiling also carries implicit defiance toward Brussels, as the EU deliberates raising tariffs on Chinese electric vehicles from the current 10% to safeguard its local market.

While electric vehicles stand as a cornerstone of China’s expansion strategy, Victor Gao, Vice President of the Center for China and Globalization, stressed to Euronews Serbia that the relationship between the two nations extends far beyond this realm.

“China and Serbia share a comprehensive bond; our perspectives on the world align closely, and we prioritize mutual respect and assistance,” he remarked. “Moreover, if Serbia assumes a significant role as a manufacturing hub for electric vehicles, it will expedite the transition from traditional fuel-based cars to electric ones.”