Today's guest of New Magazine's podcast is Nikola Krstic,
an activist from Smederevo. For several years now,
Nikola has been fighting, together with the locals from surrounding
villages, against negative aspects of the impact on the environment,
of the Chinese Company Hbis. Apart from that, through his
activities, Nikola is trying to reach some higher standards of life
quality of the citizens of Smederevo. So, we tend through a prism of
discussing how much economic development is vital, to point out
in the same time to what extent the quality of life also matters.
How much it is important to take care of the health of the population which
is directly affected with the work of the Steel factory in Smederevo.
What I regard specially important is the fact that the phrase foreign
direct investments be demystified, in the sense that this term can
carry some negative aspects after all, which are rather obvious
when it comes to Smederevo, on the local level, and this is
something that needs to be worked on and improve through calling for
accountability of the competent institutions and relevant stakeholders.
Podcast that you've been watching is produced by New Magazine,
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Enjoy our discussion, I hope you'll find it rather illuminating.
Nikola, welcome to our podcast Understandig the Steel Friendship.
I am glad to host you today. -Thank you for inviting me.
One of the reasons that you are here today is the fact that in the
previous podcasts, we discussed what China is doing globally,
we have considered different aspects of cooperation between Serbia and
China on the national level, but what is very important for reviewing
general bilateral relations is the issue what kind of consequences
this cooperation brings on the local level, i.e. what is happening
in those cities and settlements where Chinese presence is very
active, along with Chinese participants.
What seems to be very interesting is that we record this episode
several days after the celebration of the lunar new year,
that took place in Smederevo. You come from Smederevo,
as I had already mentioned, and you have multiple roles,
you are a political scientist, in the first place, someone
who deals with diverse aspects of political sciences for many years,
but you're in the same time one of the most prominent
activists, not only in Smederevo, but on a broader national level,
when it comes to ecology and figth for environmental protection,
as your primary focus of action. We will cover a number of interesting
issues, but I would like to start from what seems to be our
standard procedure, and this is the question I pose to all our guests
pertaining to the name of our podcast meaning the phrase steel friendship.
What does this phrase mean to you, as a political scientist and someone
who comes from Smederevo, and who's activist-minded,
how do you perceive this phrase understanding the steel friendship?
I understand it as a propaganda phrase designed by a Chinese
Communist Party, in order to legitimize its activities on the
Balkans and in Europe in general. On the other hand, this steel
friendship is still being perceived as a steel embrace, which can be
fruitful as every embrace, but it can also suffocate someone,
if it is too strong and if it's not on the same level of strength,
and this is exactly the case when it comes to Serbia.
So, we are being rather strongly embraced which is dangerous for us,
but it still isn't so destructive, but there are dangerous tendencies
and trends in view of Chinese impact and presence on the Balkans.
According to my opinion, and as you said, I come from a small
city of Smederevo, where the whole economy has been maintained by a
single Chinese company. To put it in the right context,
5.000 people are employed in this factory, 5.000 families...
There are also a couple of hundred of those who cooperate with it,
if we consider local statistics, 10.000 people from Smederevo
works within industrial field. On the level of the whole city,
there are 25.000 employed citizens, meaning that 40 percent works
in the field of industry in the city. So, Smederevo is an industrial city,
it has become industrial city, it hasn't been like that earlier,
and it is rather important to point this out, as a political scientist,
that cultural and political matrix, when I say cultural, I regard it
in the sense of identity, as it is hard to understand for someone
who doesn't live in Smederevo or Bor, those factories are simply
part of our identity. We have poems written about that factory,
we have celebrations taking place in the honor of the factory,
finally, my father has retired now and was awarded apartment
thanks to that factory, so many families in Smederevo, Bor or
Majdanpek, in all those industrial cities, are closely tied with them.
And now, the Chinese come, and they had come legitimately,
we have never targeted them for being Chinese, we haven't had
problems with them, but we had faced with the problem of pollution
coming from that factory. We are in the situation where
we see that the concept of profit extraction is underway.
It is a huge profit, the second exporter in Serbia, after Zijin.
I believe it was a billion dollar profit last year, you might have
more precise data. On the other hand, ecological standards are disastrously
low, or non-existent, we might say. We witness it every day, as citizens
of Smederevo, and thirdly, which is the main component,
this is the attitude of the state towards this issue, which is such
that allows violation of the law, violation of the constitution,
that they turned blind eye on them, when the inspection goes there,
if it manages to enter the factory at all, as they are almost prevented to
enter, everything's finished with some verbal warnings, not a single
fine was issued for eight years, not even a symbolic one,
and a symbolic fine would amount to three million dinars,
which is a maximum fine for an economic offense.
It cannot be higher, and not even that fine was ever recorded.
I can say now exclusively that our criminal complaint that we submitted
against Hbis in June 2022 was officially dismissed,
couple of days ago, after some 19, 20 months,
with the rationale that there isn't so much pollution that
we mention, despite our 60-pages long criminal complaint, containing
testimonies of numerous witnesses, professors of medical sciences,
metheorologists, environmentalists with huge experience in this field,
the prosecutor simply decided to dismiss the complaint,
in the investigation procedure, so we hadn't reached court procedure.
All right, you have presented a detailed review of circumstances,
diverse aspects that you've mentioned are worth a deep
investigation, and we will discuss it, but for a start, let's go one step
backwards, let's go back to 2016.
There are several data on the acquisition of the steel factory.
Or to be more precise, on purchase of the property of the steel mill...
This shows consequence of a sequence of circumstances
where the state of Serbia or the Government of Serbia
has been trying for four years to find partner, but actually,
what I want to ask you, and you touched lightly on the subject,
is the significance that the steel factory has for the city.
I would like us to make certain parallels before, primarily in the
privatization period, in early 2000, till 2012,
when the factory was managed by US Steel, then the period of
stagnation, and then the period starting with 2016.
How the attitude of the factory towards the citizens of Smederevo
changed throughout this time, as well as the attitude of the
employer or the factory management, towards the citizens of Smederevo,
and what makes the period from 2016 onward different from former period?
I would go just one step backwards, to say that this factory is there
since 1971, and it is called New steel factory.
Namely, we had an Old steel factory, that was originally built in 1923,
in the center of the town, then it was decided, as
it was of smaller capacity, to displace it to Radinac,
some 5 kilometers from city center, and make a new factory there.
It was a village near Smederevo. -Yes, it happened in 1971.
For some 30 years, the steel factory was managed by the state,
there were ups and downs, but the factory worked well,
and the technology was more or less in a good shape.
In 2003, we face with privatisation process, US Steel from Pittsburgh
comes to Smederevo, and purchases the factory.
The privatization itself was criminal, it was one of the
privatisation cases that Verica Barac was talking about.
We should refer to a rather paradoxical situation that
on the one hand, we had democratic authorities, that took over the state,
and I still have great respect towards the murdered Prime Minister Djindjic,
but what seems to be the problem... Chief of Cabinet of the deceased
Prime Minister Djindjic, Nemanja Kolesar, was in charge for this
privatisation, it was Sartid back then, and later on, he was arrested,
but nothing happened in the end, it passed as it is.
Verica Barac spoke about this privatisation in 2004,
you can find her 2004 report even today on Google,
but to no avail. It was all over.
Then, we reached 2008, when the world economic crisis started,
the Americans realized that they are going to make losses,
and it took them four years to decide to leave in 2012,
when they returned the steel factory to the state for 1 dinar.
Then, we faced with the crucial four-year period, 2012-2016,
which is of vital significance for what followed,
as we had back then, if you recall, the so-called professional management
headed by Peter Kamarash, this is the man who in the end
sued the state for termination of contract, and won in arbitration,
but what seems to be the problem, we had made losses of 150 million
euros every single year, 150 million euros cost we had to pay
as a state, for keeping social peace, as it was obvious that this factory
was not economically viable. What happened next?
The state was looking for strategic partner or someone to purchase
the factory, no one would do that under market conditions, as it was
literally a bottomless pit and the only ones that could do that were
the Chinese, due to their position on the market, due to their not
being obliged to respect labor rights, or ecological rights,
but also due to the fact that they have been given a special
status with that purchase agreement from 2016, where they actually got
all the rights on 1200 pages to do what they currently do.
So, this is a crucial moment, as an introduction to the story,
and then in 2016, they come, and in the symbolic sense,
it was important that Xi Jinping opened it with Aleksandar Vucic,
there were flags of China and Serbia, if you could recall,
Brother Xi, as he is called here, all gathered workers were genuinely
happy about it, as well as the people in Smederevo.
When such a gigant is shut down, on which whole economy depends,
this is reflected to the secondary sector, on the bakeries, restaurants,
coffee bars, boutiques, all are linked in that chain, so the hopes were up,
making 2016/17 - the year of hope. It was followed by 2018, when
we started to deal with it, when we witnessed that
we woke up surrounded with some red clouds, we couldn't
breathe, we had soar throats, we got complaints from the people
living in surrounding villages, Radinac, Vranovo and Ralja,
those three villages bordering with the steel mill, as the factory
is situated on a huge ground amounting to 320 hectares.
They called us enclosing photos of their cars being covered in red
dust, it was a disastrous situation. This is the moment when we realize
that we have a serious problem, as they are working with full steam,
and on the other hand, we are facing with ecological disaster,
with poor labour rights, 45.000 dinars wages, around 400,
mostly all registered through third parties, without any major rights,
this was the moment when we realized that we are in trouble.
In a big trouble, actually, as we knew that the state backs them.
Just to look at that period of transition, once again...
What I found interesting, when I first gained insight into agreement,
practically, Smederevo Steel Mill was not sold at all, as a business
legal entity, its property has been sold out,
and if you look at the list of debtors of the EPS,
Smederevo Steel Mill is among the first ranked...
It is indebted for 45 million for electricity,
and there's one interesting thing linked with that legal matters,
so, the Steel Factory still exists, simply, it is in bankruptcy,
before liquidation but still existent, with three employees,
or something like that, and we faced with the issue...
When we launched the issue of slag waste, there are huge hills,
deposited by the Danube, 600m x 300m, 20 meters high.
This is slag waste, a side product of production, we thought that
it should not be placed near Danube, on the fertile soil, justifiably so.
When we scratched a little where it came from, we even had a meeting
with Hbis, the only time so far... -When that happened?
It took place in 2019, if I remember, they told us literally that they don't
have anything to do with that slag waste, that it's done by
the Smederevo Steel Mill. We asked them whether
they present Smederevo Steel Mill, they said that they have nothing to
do with it, and they are new business entity, and this is being
done by Smederevo Steel Mill that is in bankruptcy.
So, we asked them to whom that slag waste belong...
Then they said that it was left behind by the Americans,
some fifteen years ago. According to our unofficial findings,
I cannot claim that it's hundred percent true, but as we live and
work there and know that it's so, they kept bringing out that slag,
and present it as an old slag, as if some third parties were
bringing it, and as a cover for that, Smederevo Steel factory was to blame.
There's no mention of Hbis, Hbis is nowhere to be found,
in that particular situation, and what they also did,
they had made lex specialis in 2017, it can be found on Google as the
Law on Steel Mill... -On the national level...
Yes, in the Parliament. With that Law, slag from
the steel factory was declared as construction waste, not an
industrial waste, so the Law on Waste Management is not competent,
so it is being considered a garbage, so the relevant institution is not
the one that is meant for that, so they protected themselves fully.
We had submitted a range of complaints, and nothing happened.
Now, we reached the period starting with 2016 till the present day.
It is also important to mention that during this four-year period,
Steel Mill wasn't working at all, its production was low,
but then we witness the growth of production.
With that, side effects are also being evident, including the slag,
but also exhaust fumes, and other consequences of industrial production.
What is happening with the parameters that indicate failure to pay attention
to the modernization of the industrial process itself.
I have often explained that to people in layman terms,
you've been given a car that wasn't functinal for 20 years,
and it is normal that the first smoke upon turning on the car would be
black as coal, but it seems that this black smoke still blows out
of the chimney managed by Hbis, eight years later...
That's right, and we cannot blame Hbis for that...
For the fact that technology has failed, Hbis is not to blame,
as this was an old technology where everything is in the open.
There are hills made of coal, used in the production, hills
made of limestone and ore, it is all in the open, the wind blows,
spreading it, so it is quite a simple problem, if we have factory halls,
the problem will be reduced, and then we face with the production
and the emission of gases and other vapors from there.
What seems to be the problem? After 2016, we have situation
that parameters that measure the level of pollution haven't changed
much compared to 2022, for instance. We always had some 140-150 days
per year with an overdraft, which is almost six-month period,
not only seasonal, during winter, but also during summer,
we made some analyses in July and September that showed great amount
of pollution even in that period, in Radinac.
There's also an economic aspect of the whole story, pertaining to
increasing the level of production, and there are people who are
satisfied with that. The sayings from Bor and Majdanpek go
like this: it's good as long as there is smoke...
So, it is good if it works, the problem is when it stops.
In the agreement itself, we found out now when our criminal complaint was
rejected, that they are not obliged to do many things, pertaining to
measurement of suspended particles, simply, the state had given them
green light to do what they do. This is the biggest problem.
I want to ask you something regarding this saying: people
are satisfied, as long as there's smoke coming out.
Are the people satisfied? -Well, that is really...
We cannot respond to that question unequivocally, because on one hand,
there are lots of people that are satisfied because this factory is
functional, they work there and have certain monthly source of income,
as they have no other alternative, however, for the last couple of years,
it is a trand, so you will hear it often from the citizens of Smederevo,
people are dissatisfied because of low wages, so nowadays, you can
work in a tobacco shop and have higher sallary than those working
in the dust to their knees, while performing hard physical work.
Salaries are rather low, on the other hand, ecological standards are such
that people do not want to jeopardize their health.
Third, some new factories emerge, we have one for cable winding,
with the same wages, so people chose to go to those factories
to work in a cleaner environment. So, people are not satisfied,
this is for sure, and from perspective of our association, and in line with
what we propagate, the biggest problem with that factory and with pollution
coming from it, is that we don't have Plan B.
So, if Chinese investor, they can be called investors as they made some
investment, we will discuss it later, as until last year, they were not
investors, so if the Chinese investor decides to leave tomorrow for some
strategic reasons, we will end up a dead city.
The town would literally shut down, as we don't have clear strategy
what to do as a Plan B in case Chinese investor leaves.
So, will we turn to developing agriculture, for which we have
huge potentials, will we turn to developing tourism as the city
lies on two rivers, whether we will direct ourselves to service sector
instead of knowledge sector... The people cling to that factory
as if there's no alternative. We again refer to the issue
of identity, as it is simply unimaginable for the factory
to stop working. Generations and generations have grown up there.
From the point of view as political scientist, it seems to me that
one of the goals of our policy, although it is rather hard to say,
stands in promoting that economic development,
as all other aspects fall to the second and third position
as long as we have some positive economic indicators.
So, it seems that for Smederevo, going back again to 2016,
it was positive that the city will be revitalized, but what I came across
in some reports was the fact that there were promises that they would
invest into the building of new capacities, that would be ecologically
more acceptable, including certain facilites that would affect pollution
and lower its consequences. Did this happen, did something
change in view of responsibility, if not only on the part of the owner
of the facility, i.e. Hbis, but also on the part of the state of Serbia?
Were there any indications that Serbia as a state exerts certain
pressure on the company to adjust to something that would be called
acceptable standards about impact on the environment in Smederevo?
Yes, two important things happened, the investment into the new plant
of agglomeration took place, we don't know how much money
was invested, they say several hundreds of millions but we doubt it,
but the new agglomeration facility has been constructed, that were
one of the biggest problems within the steel factory.
It launched its operations in 2022, they promised us
on the first meeting that they would do that in 2020, then it happened
two years later, so this is a positive indicator,
and measurements in 2023, on the measuring station Radinac,
show significant decrease in pollution, but we cannot conclude
that this is in direct correlation with the factory, as the level of
pollution in the country as a whole was much lower,
so we must wait for a certain longer period to pass by, so that we can
make such conclusions, as due to meteorological circumstances,
we had lower level of pollution throughout the country in 2023.
Yet, in 2024, we have rather bad parameters, in January,
so we will see what this year will bring.
Second important thing is that Hbis invested, that is to say, donated
measurement station in Radinac, for the quality of air, it was a
donation to the environmental agency. This measuring station
already existed, it was a result of the fight of our association,
when we blocked both the factory and the road, and back then, they
only met one condition, putting that station into operation.
All other requests were denied, but it was very important, as it
happened in 2020, we got clear state results for the first time,
that we face with the problem. Prior to this, we talked in vain,
without any proof, based on our feeling, then we got data
from state monitoring and then we decided to submit criminal
charges as, on the one hand, we had state monitoring of air
quality, on the other, medical files of the residents, ten families
were engaged in submitting it, and third, we simply witnessed
ecological disaster every day, through recording and photos.
We have filed criminal complaint in June 2022, and in February 2024,
our charges are rejected, a couple of days ago.
So, we realized that it is impossible that we protect our rights in the
institutions, when it comes to Chinese companies, as they
are practically defended by our state, so they behave
as if we are Chinese province, they are fully protected.
Everything is subjected to their making profit, at the expense of
human lives if necessary, we had a case in Smederevo last year,
when a young boy got killed on the crane. According to my informal
findings, I would like to hear they refute this, and we find this out
from the close family of the victim, they tried to cover up everything,
they threaten all other people, giving them bonus of 10.000 dinars,
in order to remain silent. So, you can imagine how much
life in that factory is worth, and how they regard us as
the genuine tribal community. -What seems to be in trend now,
and we will have the opportunity to discuss it in the next episodes
with the people from Bor and probably Zrenjanin,
it is the obvious lack of any responsibility for certain moves.
It is not strange that an industrial city faces higher pollution level,
it is not strange that like in any dangerous activity, and heavy
industry falls under the category of dangerous activities,
safety at work is sometimes violated, bringing more or less serious cases
of accidents. What seems to be disputable is the responsibilty
that someone takes or does not take, and the process following the incident
in order to prevent it from happening in the future.
This is a conclusion which is mainly tied to the institutions, the ones
that could take over this responsibility.
As an association, your Movement Fortress wages battle for better
Smederevo for years now. For cleaner Smederevo...
It is important to mention it, and as you said, you do not
wage battle against the company because it is a Chinese company,
nor do you fight against the people that are employed in the factory,
you wage battle for the environment that would make your lives better.
Sometimes, 10-20 percent more money is not necessarily enough for making
life in certain environment better. Who are your allies in that war,
or I could rephrase the question: did local authorities showed any
understanding or the company itself, or the national authorities,
or others that you turned to? -This last question is simply
redundant. It is obvious that both local and state authorities are aware
of the problem, even our former mayor is from the village Vranovo,
he literally lives on the entrance of the steel factory, and we know
that he used to support our activities, meaning that he
understood our reasoning, but in discussing things with them,
with decision makers, they always say: you know it's a higher policy.
We had the same situation with the people from legal system,
when they tell us that their hands are tied, and that this is not the
issue of rights and Serbian institutions.
But that this is all about global relations, that are
above us all, and that we are practically being played with, as
as a sacrificial lamb, as China made huge impact on the Balkans.
As for our allies, citizens in the first place, local citizens
of those villages, and I would like to point out that those villages...
For instance, when Rio Tinto was discussed, where citizens rightfully
protested and were against mine, we have situation that those are
villages of several hundred locals. Over here, we have big villages,
hihgly populated, Radinac has 5.500 residents, Vranovo - 3.500,
Ralja - 2.500 people, so we have 10.000 people surrounding factory,
on its wire borders. 10.000 is rather huge number of people,
plus 100.000 people endangered in the city on the whole.
So, we are talking about highly populated area and if you get
data that we collected from the health centers on the state of
health of the citizens, we got a rather shocking result.
In 2010, there were in Smederevo 1780 active cases of malignant
illnesses, this is 1.5 or 1.7 percent of population, while in 2020,
we had 6860 such cases, pertaining to 6 to 7 percent of population.
We have data that Bor has even eight percent of population ill.
When I disclosed all the information to the people not living in Serbia,
as I recently visited United Nations due to such circumstances, as I was
giving a speech in front of Ecology Committee, people
did not believe me. I was forced to show them those papers.
Simply, people cannot gather that every eighth person out of hundred
in the room had an active form of malignant disease.
This is simply unacceptable. I have a small child, and I also
live in that same city. To start from the beginning,
how we started our fight against the pollution. It is not that it
bothered us estheatically by the dust, so I wanted to be clean...
It is not aesthetic that we worry about,
it concerns our health. This is something that
we often reiterate, as for us, it is not relevant whether it
is American or Chinese investor. As for me personally, it is of utmost
importance that no one is allowed to poison me with vapors,
me and my family, and they do poison us.
I see the room for the state to tolerate it. We feel unprotected,
I see no way of offering hope to the citizens...
Some of them signed the petition and now lost in court, and imagine
how they feel when someone said that they were lying about pollution.
Those people don't open the door, they are inside their houses due
to diverse fumes, dust. Their children are not coming
for a visit, you have numerous examples that children do not
come here, as the kids cannot touch anything, because their
hands instantly turn grease and red. So, they made those people liars.
It is hard to discuss other things that are not related to this that
you've just mentioned, as finally, what is top priority if not human
life, but some other aspects that I find relevant in order to understand
the way in which on the local level we can see the presence of some
huge stakeholder, and the results of cooperation with that stakeholder,
this is some cultural impact that this cooperation brings.
I believe that you hadn't expected ten years ago that your town would
officially celebrate lunar new year as it was the case few days ago.
This is not necessarily something bad, it is cultural cooperation.
It is a legitimate thing, but it definitely shows a growing social
impact which the presence of such stakeholder has on local community.
There is certain number of Chinese workers employed in the factory.
Is this social impact of Chinese company evident on the local level?
Or the impact of the state of China, or the Chinese Communist Party?
We had reports that Chinese policemen come to Smederevo,
and that they would be... -We already have them on streets.
That they would be glorified translators without major powers.
I would like to discuss with you in the final part of this interview
about this cultural aspect that through the cooperation
of two states, and with presence of a concrete stakeholder, is rather
obvious that it influences local community.
It is interesting that you can see Chinese patrols accompaning
the Serbian police patrols, they are without arms,
but they got police badge. I assume that there is a legal
framework for their presence, but it's unclear what they are
doing here exactly, and frankly, I don't find it amusing at all,
as the sovereignty of this country is brought into question.
Imagine American policeman that accompanies our policemen and
patrols my city, I would find it equally bizarre.
On the other hand, you have Chinese employees, we had
data from the police as to how many Chinese citizens were in Serbia in
2022, there were somewhat near a thousand of them, it is not
such a huge number if we compare it with Bor or Majdanpek where
we had significantly higher number. What seems interesting is that
they are ghettoed, we entered that camp at one point,
they practically live in containers, the living conditions are not
so satisfying, but this is common practice in all Chinese companies.
It is interesting that management of the company does not live in
those containers but in the most luxurious part of Smederevo,
in the villas, by the Danube. So, this concept of equality
in Communism wasn't observed here in this particular case...
We can undoubtedly conclude at the end of our discussion,
is the fact that global policies or as you mentioned relations on
the level higher that national level, are definitely felt on the local level
and it is obvious that it is necessary to shed some light on the things
that are not right, or the issues that should be dealt with,
in order to improve them. Smederevo is a historic town,
it is an important city, some historical rulers originated from
Smederevo, and people that were depicted as dragons, and definitively
as fighters. What you are doing in Smederevo is also fighting for
better Smederevo, I hope that you will have more and more comrades
in this venture, for the sake of health of your child, and other
children in your town, that you will have a chance to
provide existence in this economic aspect, as we all want for economy
to bloom and flourish, but not at the expanse of health of
people who live in that area. I hope that people who listened
to our conversation for the last 30 minutes will find out why your
mission is so important. I also hope that you would not
lose your enthusiasm, although you face with many obstacles,
including some lost causes, but we should finish the interview
with this saying: you may have lost a battle, but not the war.
I hope that some of the initiatives that you've launched will result in
some positive aspects for the citizens of Smederevo
and surrounding villages. Nikola, thank you very much,
it was a pleasure talking to you, and I hope that next time when
we had opportunity to discuss this subject, you will breathe easier.
Thank you for inviting me.
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