- G7 leaders pledged to raise $600 billion in private and public funds over five years to fund needed infrastructure in developing countries.
- The investment will support projects in low- and middle-income countries that help fight climate change and improve global health, gender equity and digital infrastructure.
- The program aims to build a sustainable alternative to the former multi-trillion-dollar Belt and Road project in China.
- Some believe the pledges are a good start towards greater engagement by G7 countries in developing countries and could support stronger global growth.
Group of Seven leaders pledged to raise $600 billion in private and public funds over five years to fund needed infrastructure in developing countries and counter China’s multi-billion dollar Belt and Road project .
US President Joe Biden and other G7 leaders relaunched the new ‘Global Infrastructure and Investment Partnership’, at their annual gathering being held this year at Schloss Elmau in southern Germany .
Biden said the United States would mobilize $200 billion in grants, federal funds and private investments over five years to support projects in low- and middle-income countries that help fight climate change as well as improve global health, gender equity and digital infrastructure.
“I want to be clear. This is not about aid or charity. This is an investment that will pay off for everyone,” Biden said, adding that it would allow countries to “see the concrete benefits of partnership with democracies.
Biden said hundreds of billions more could come from multilateral development banks, development finance institutions, sovereign wealth funds and others.
Europe will mobilize 300 billion euros ($317.28 billion) for the initiative over the same period aimed at building a sustainable alternative to China’s Belt and Road Initiative program, which the Chinese President Xi Jinping launched in 2013, European Commission President Ursula von der Leyen said. .
Infrastructure is one of the least technologically transformed sectors in the entire economy, with crucial components like construction ranking second to last in digitalization according to industry rankings. Technology infrastructure has the potential to change the way we plan, design, finance, build and operate our infrastructure systems and, more importantly, help achieve broader goals of sustainability, social cohesion and growth. inclusive economy.
Image: Global Infrastructure Center
The World Economic Forum’s Infrastructure 4.0 initiative, supported by the Global Infrastructure Hub, strives to improve the adoption of emerging infrastructure technologies throughout the lifecycle of assets and systems.
By creating recommendations for decision makers and contributing best practice case study examples to the Global Infrastructure Hub’s G20 Infratech Use Case Library, this initiative aims to refocus the conversation on infrastructure development. around how infrastructure as a tool to deliver better outcomes in people’s lives and technology. role in realizing this people-centred future.
The leaders of Italy, Canada and Japan also spoke 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 taking part.
China’s investment plan involves development and programs in more than 100 countries aimed at creating a modern version of the ancient Silk Road trade route between Asia and Europe.
White House officials said the plan had brought little tangible benefit to many developing countries.
US President Joe Biden attends a working lunch with other G7 leaders to discuss developments in the global economy at the Yoga Pavilion, Schloss Elmau in Kuren, Germany
Image: Kenny Holston/Pool via REUTERS
Chinese Foreign Ministry spokesman Zhao Lijian defended the BRI’s record when asked to comment during a daily briefing in Beijing on Monday.
“China continues to welcome all initiatives to promote global infrastructure development,” Zhao said of the G7’s $600 billion plan.
“We believe that there is no doubt that various related initiatives will replace each other. We oppose advancing geopolitical calculations under the guise of building infrastructure or smearing the Belt and Road Initiative.”
Biden highlighted several flagship projects, including a $2 billion solar development project in Angola with support from the Department of Commerce, the US Export-Import Bank, US-based AfricaGlobal Schaffer and the developer of American Sun Africa projects.
Working with G7 members and the EU, Washington will also provide $3.3 million in technical assistance to the Pasteur Institute in Dakar, Senegal, as it develops a flexible multi-vaccine manufacturing facility at the industrial scale in this country that will eventually be able to produce COVID-19 and other vaccines. , a project that also involves the EU.
The U.S. Agency for International Development (USAID) will also commit up to $50 million over five years to the World Bank’s Global Child Care Incentive Fund.
Friederike Roder, vice president of the non-profit group Global Citizen, said the investment pledges could be “a good start” towards greater engagement by G7 countries in developing countries and could support global growth. stronger for everyone.
G7 countries spend on average just 0.32% of their gross national income, less than half of the promised 0.7%, on development aid, she said.
“But without developing countries, there will be no sustainable recovery in the global economy,” she said.