G7 launches $600 billion infrastructure plan to confront China | News

The G7 Global Infrastructure Partnership and Investment will help finance infrastructure projects in developing countries.

Leaders of the Group of Seven (G7) countries have pledged to raise $600 billion in private and public funds over five years to finance infrastructure in developing countries and counter China’s multi-trillion dollar Belt and Road project.

US President Joe Biden and other G7 leaders relaunched the newly renamed Partnership for Global Infrastructure and Investment on Sunday at their annual meeting this year in Schloss Elmau in southern Germany.

“Developing countries often lack basic infrastructure to help weather global shocks, such as the pandemic, so they feel the impacts more acutely and have a harder time recovering,” Biden said.

This is not just a humanitarian concern, it is an economic and security concern for all of us. “

He said the United States will raise $200 billion in grants, federal funds, and private investment over five years to support projects in low- and middle-income countries that help tackle climate change as well as improve global health, gender equality and digital infrastructure. .

“I want to be clear. This is not an aid or a handout. It is an investment that will bring returns to everyone,” Biden said, adding that it would allow states “to see the tangible benefits of partnering with democracies.”

Biden said hundreds of billions of additional dollars could come from multilateral development banks, development finance institutions, sovereign wealth funds and others.

Europe will mobilize 300 billion euros ($317 billion) for the initiative over the same period to build a sustainable alternative to the blueprint for China’s Belt and Road Initiative, which Chinese President Xi Jinping launched in 2013, European Commission President Ursula von der Leyen told the ceremony. .

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The leaders of Italy, Canada and Japan also talked about their plans, some of which have already been announced separately. French President Emmanuel Macron and British Prime Minister Boris Johnson were not present, but their countries are also participating.

China’s investment blueprint includes development and programs in more than 100 countries aimed at creating a modern version of the ancient trade route of the Silk Road from Asia to Europe.

White House officials said the plan offered few tangible benefits to many developing countries, and that it corners debt-receiving countries and investments that benefit China more than its hosts.

Biden highlighted several pioneering projects, including a $2 billion solar energy development project in Angola supported by the Ministry of Commerce, the US Export-Import Bank, US AfricaGlobal Schaffer, and US project developer Sun Africa.

Along with members of the Group of Seven and the European Union, Washington will also provide $3.3 million in technical assistance to the Pasteur de Dakar Institute in Senegal as it develops a flexible, multi-vaccine manufacturing facility on an industrial scale in that country that could eventually produce COVID-19 and other vaccines, which is A project that also includes the European Union.

USAID will also commit up to $50 million over five years to the World Bank’s Global Child Care Stimulus Fund.

Frederic Roeder, vice president of the nonprofit Global Citizen Group, said investment pledges could be a “good start” toward greater G7 involvement in developing nations and could support stronger global growth for all.

She said the G7 countries provide, on average, only 0.32 percent of their gross national income – less than half the promised 0.7 percent – in development aid.

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“But without developing countries, there will be no sustainable recovery for the global economy,” she said.

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