Western Belt and Road: good idea, bad reason

2 minute read

Italian Prime Minister Mario Draghi, European Commission President Ursula von der Leyen, U.S. President Joe Biden, German Chancellor Olaf Scholz, British Prime Minister Boris Johnson, Canadian Prime Minister Justin Trudeau, Japanese Prime Minister Fumio Kishida, French President Emmanuel Macron and European Council President Charles Michel pose for a photo during the G7 summit in Schloss Elmau, near Garmisch-Partenkirchen, Germany June 26, 2022. Stefan Rousseau/Pool via REUTERS

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HONG KONG, June 27 (Reuters Breakingviews) - The Group of Seven nations want to raise $600 billion read more for infrastructure in poorer countries. It’s a transparent attempt to counter Beijing’s controversial Belt and Road Initiative, which sceptics suspect is a nefarious scheme to foist China’s vast industrial overcapacity onto developing economies and turn them against the West. U.S. President Joe Biden said the G7 programme will exhibit “the concrete benefits of partnering with democracies.”

It’s flattering to be fought over, and some situations are desperate. World Bank data suggests low- and middle-income countries will need $15 trillion between 2015 and 2030 for roads, hospitals, solar panels and so on. Regions facing skyrocketing energy and food prices also need short-term assistance. China, facing its own challenges, has slowed Belt and Road spending.

Financial aid with better governance and less geopolitics would be preferable. During the Cold War, the West threw trillions of dollars into the southern hemisphere to wean states from the Soviet Union. Doing the same just to keep them from China could deliver similarly lacklustre results. (By Pete Sweeney)

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(The author is a Reuters Breakingviews columnist. The opinions expressed are their own.)

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Editing by Jeffrey Goldfarb and Thomas Shum

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