At the Group of Seven (G7) summit held in the UK, the leaders of the seven countries agreed to launch a plan to support infrastructure construction in low- and middle-income countries to counter China’s “Belt and Road” initiative, but relevant details have yet to be announced.
The White House issued a statement on Saturday (June 12) stating that Biden and the leaders of the G7 countries agreed to launch this new global infrastructure initiative. This “a high-standard, value-oriented transparent infrastructure partnership investment program led by democratic countries will help improve the infrastructure of developing countries with a total value of more than 40 trillion U.S. dollars.”
Since 2013, China has invested in railways, roads, and port infrastructure in many developing countries through the “Belt and Road” initiative, but some critics believe that this plan has plunged many countries into debt.
A statement issued at the G7 summit also stated that it will seek to establish a “value-oriented, high-standard and transparent” partnership.
It is not clear that more details of this B3W plan, such as how to raise funds. The White House stated that more details of this plan will be announced in the summit communiqué.
The members of the G7 include the United States, Canada, the United Kingdom, France, Germany, Italy, and Japan. This summit was held in Cornwall, UK.
B3W and the “Belt and Road” Initiative
The White House said that Biden and several other Group of Seven leaders hope that the B3W plan can establish a transparent infrastructure partnership to help developing countries close the required US$40 trillion funding gap. The plan will catalyze hundreds of billions of dollars in funds to be invested in low- and middle-income countries in the next few years.
It is not clear how this plan will be implemented and how much funds will eventually be allocated. German Chancellor Merkel said that it has not yet reached the stage of financing the plan.
A senior official in the Biden administration told Reuters that the B3W plan is not just for China. But “at present, we really do not provide a choice that reflects our values, standards, and business channels.”
Refinitiv data show that as of the middle of last year, the number of projects related to the “Belt and Road” has exceeded 2,600, costing US$3.7 trillion. But China’s Ministry of Foreign Affairs stated in June last year that 20% of projects were severely affected by the global pandemic.
The White House stated that as part of the G7 plan, the U.S. government will cooperate with the U.S. Congress to supplement existing development financing and “co-catalyze hundreds of billions of dollars in infrastructure investment.”
The White House revealed that the plan will emphasize several important standards, including transparent and sustainable investment value orientation, adherence to high standards in environmental, climate change, and labor rights protection, and the project must go through professional consulting procedures.
Bloomberg reported that at a meeting on Saturday, Biden pressured several other leaders on China’s forced labor, asking them to take more specific actions, showing that China’s treatment of Uyghurs is morally bad. And it is still unfair economic competition.
Reuters quoted another U.S. official as saying that in the language of criticism in the final statement, “different countries have different degrees of how far they are willing to go.”
The official also said that the G7 has reached a consensus that it is necessary to take joint action on “non-market economic practices” and human rights issues, and to collaborate on supply chain issues. At the same time, the United States also vigorously fought for the wording in the communiqué against the alleged forced labor issue in Xinjiang.
Earlier this year, the United States, the European Union, the United Kingdom and Canada imposed coordinated sanctions on China.
Its sanctions include travel bans and asset freezing, and the main targets are senior Xinjiang officials accused of serious violations of the human rights of Uyghur Muslims.
It is estimated that more than 1 million Uighurs and other ethnic minorities have been detained in re-education camps in Xinjiang. These people generally have not been prosecuted and tried.
The Chinese government is accused of “compulsory sterilization” of some Uyghur women and separating the children from their families.
In a report released by the BBC in February this year, interviewees provided first-hand testimony about rape, sexual abuse and torture of detainees.
China initially denied the existence of these camps, and later defended them, saying that these schools are education and training schools for combating terrorism and de-radicalization. Beijing has denied any allegations of human rights violations.
In response, China stated that it sanctions the EU “10 persons and 4 entities that seriously damage China’s sovereignty and interests and maliciously spread lies and false information”, as well as 9 persons and 4 entities from the British side.
Relevant personnel and their family members are prohibited from entering mainland China, Hong Kong and Macau, and they and their associated companies and institutions are restricted from communicating with China.
Analysis: an American plan against China
BBC North AmericaAffairsedit Jon Sopel
The Americans made Saturday’s G7 agenda a challenge to China’s growing influence. Beijing’s “One Belt, One Road” initiative has dumped billions of dollars into developing countries, and Western democracies must act on this.
Senior officials in these countries want to prove that Western values can prevail. They believe that the cost of Chinese investment is already too high, that the practice of forcing Xinjiang Uyghurs to work is extremely bad in morals, and that China’s actions to prevent fair competition are economically unacceptable.
Biden will insist that such labor practices will not exist in the global supply chain. US officials said that this is not only to confront China, but also to present a positive option to the world.
However, the Biden administration has not been clear about how much the Western world should contribute to this global infrastructure project and its time frame. What is clear at present is that the Western powers have once again made up their minds, and they need to act now to deal with an increasingly powerful China that is heading for a rejuvenation.