G7 aims to raise 600 billion dollars to counter China’s Belt and Road

US President Joe Biden attends a working lunch with other G7 leaders to discuss the shaping of the global economy at the Yoga Pavilion, Schloss Elmau in Kuren, Germany on June 26, 2022. Kenny Holston /Pool via REUTERS

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SCHLOSS ELMAU, Germany, June 26 (Reuters) – Leaders of the Group of Seven pledged on Sunday to raise $600 billion in public and private funds over five years to finance needed infrastructure in developing countries and counter old China’s multibillion-dollar Belt and Road project.

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

Biden said the United States would mobilize $200 billion in grants, federal funds and private investment over five years to support projects in low- and middle-income countries that help address climate change and improve global health, gender equality and infrastructure. digital.

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“I want to be clear. This is not aid or charity. It is an investment that will generate benefits for all,” Biden said, adding that it would allow countries “to see the concrete 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 for the initiative over the same period to build a sustainable alternative to China’s Belt and Road Initiative scheme, which Chinese President Xi Jinping launched in 2013, the Commission chair said. Union, Ursula von der Leyen, at the meeting.

The leaders of Italy, Canada and Japan also discussed 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 scheme involves development and programs in more than 100 countries aimed at creating a modern version of the ancient Silk Road trade route from Asia to Europe.

White House officials said the plan has provided few tangible benefits for many developing countries.

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

Along with members of the G7 and the EU, Washington will also provide $3.3 million in technical assistance to the Dakar Pasteur Institute in Senegal as it develops an industrial-scale, multi-vaccine flexible manufacturing facility in that country that can eventually produce COVID-19 and other vaccines. , a project in which the EU is also participating.

The United States 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 nonprofit group Global Citizen, said the investment promises could be “a good start” toward greater involvement of G7 countries in developing nations and could underpin stronger global growth for all. .

G7 countries provide on average only 0.32% of their gross national income, less than half of the promised 0.7%, in development assistance, he said.

“But without developing countries, there will be no sustainable recovery of the world economy,” he said.

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Information from Andrea Shalal; Edited by Mark Porter and Lisa Shumaker

Our standards: The Thomson Reuters Trust Principles.

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