G7 Leaders Announce $600 Billion Global Infrastructure Program to Take on Beijing’s Debt Trap Diplomacy

Dorothy Li
By Dorothy Li
June 26, 2022China News
G7 Leaders Announce $600 Billion Global Infrastructure Program to Take on Beijing’s Debt Trap Diplomacy
U.S. President Joe Biden speaks at the "Global Infrastructure" side event as Prime Minister of Japan Fumio Kishida and Canadian Prime Minister Justin Trudeau look on during the G-7 summit at Schloss Elmau near Garmisch-Partenkirchen, Germany, on June 26, 2022. (Sean Gallup/Getty Images)

Leaders from the Group of Seven (G7) representing the wealthiest democracies announced $600 billion for global infrastructure programs on June 26 to counter the Chinese regime’s expansion through its financing of enormous loans to poor countries for building infrastructure.

U.S. President Joe Biden and other G7 leaders pledged to raise $600 billion by 2027 for the plan, known as the Partnership for Global Infrastructure and Investment, aimed at supporting the infrastructure needs of low- and middle-income countries.

“I want to be clear, this isn’t aid or charity,” Biden said as he unveiled the project following the meeting at the beginning of the three-day summit in Germany.

“It’s an investment that will deliver returns for everyone, including the American people and the people of all our nations.”

The United States will mobilize $200 billion for the partnership over the next five years “through grants, federal financing, and leveraging private sector investments,” according to the White House.

Europe has announced it will mobilize €300 billion over the same period.

“This will only be the beginning,” the White House said in a separate statement. “The United States and its G7 partners will seek to mobilize additional capital from other like-minded partners, multilateral development banks, development finance institutions, sovereign wealth funds, and more.”

‘Debt-Trap Diplomacy’

The infrastructure plan is seen as a rebranding of the Build Back Better World initiative, also known as B3W, which was first unveiled at last year’s G7 summit in England as a response to the Chinese regime’s multitrillion-dollar Belt and Road (BRI) project.

Launched by Chinese leader Xi Jinping in 2013, the BRI reached it peak in expanding the regime’s influence in 2015 through global trade links and building railways, ports, highways, and other infrastructure projects. More than 140 countries have joined the initiative, with mixed results.

Critics of the BRI have dubbed the project a form of “debt-trap diplomacy,” which saddles developing nations with unsustainable debt levels, leaving them vulnerable to ceding strategic infrastructure and resources to Beijing. In September, research lab AidData counted at least 42 countries with public debt exposure to China exceeding a tenth of their gross domestic product.

“It is up to us to give a positive and powerful investment impulse to the world to show our partners in the developing world that they have a choice,” said European Commission President Ursula von der Leyen at the Sunday news conference.

(L-R) Italy’s Prime Minister Mario Draghi, Canada’s Prime Minister Justin Trudeau, European Council President Charles Michel, French President Emmanuel Macron, Germany’s Chancellor Olaf Scholz, European Commission President Ursula von der Leyen, US President Joe Biden, Britain’s Prime Minister Boris Johnson and Japan’s Prime Minister Fumio Kishida attend a working dinner during the G7 Summit held at Elmau Castle, southern Germany, on June 26, 2022. (Markus Schreiber/AFP via Getty Images)

The partnership will focus on health, digital infrastructure, gender equality, climate, and energy security.

Biden highlighted several flagship projects, including a $2 billion solar development project in Angola with support from the U.S. Commerce Department, the U.S. Export-Import Bank, U.S. firm AfricaGlobal Schaffer, and U.S. project developer Sun Africa.

“When democracies demonstrate what we can do, all that we have to offer, I have no doubt they will win the competition every time,” he added.

Reuters and Eva Fu contributed to the report.

From The Epoch Times

ntd newsletter icon
Sign up for NTD Daily
What you need to know, summarized in one email.
Stay informed with accurate news you can trust.
By registering for the newsletter, you agree to the Privacy Policy.