The G7 aims to raise $600 billion to counter the Belt and Road in China

US President Joe Biden attends a working lunch with other Group of Seven leaders to discuss shaping the global economy at the yoga pavilion, Schloss Elmau in Koren, Germany, June 26, 2022. Kenny Holston/Paul via Reuters

Schloss Elmau, Germany (June 26) (Reuters) – Group of Seven leaders pledged on Sunday to raise $600 billion in private and public money over five years to fund needed infrastructure in developing countries and tackle the aging multi-trillion-dollar Belt and Road project.

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

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

“I want to be clear. This is not aid or charity. It is an investment that will bring returns to everyone,” Biden said, adding that it would allow countries to “see the tangible 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.

European Commission President Ursula von der Leyen told the meeting that Europe would raise 300 billion euros for the initiative during the same period to build a sustainable alternative to China’s Belt and Road Initiative, launched by Chinese President Xi Jinping in 2013.

The leaders of Italy, Canada and Japan also talked 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 participating.

China’s investment blueprint includes development and programs in more than 100 countries aimed at creating a modern version of the ancient trade route of the Silk Road from Asia to Europe.

White House officials said the plan offered few tangible benefits to many developing countries.

Biden highlighted several pioneering projects, including a $2 billion solar energy development project in Angola supported by the Ministry of Commerce, the US Export-Import Bank, US AfricaGlobal Schaffer, and US project developer Sun Africa.

Along with members of the Group of Seven and the European Union, Washington will also provide $3.3 million in technical assistance to the Pasteur de Dakar Institute in Senegal as it develops a flexible multi-vaccine manufacturing facility on an industrial scale in that country that could eventually produce COVID-19 and other vaccines, a project It also includes the European Union.

USAID will also commit up to $50 million over five years to the World Bank’s Global Child Care Stimulus Fund.

The investment pledges could be a “good start” toward greater engagement by G7 nations in developing nations and could support stronger global growth for all, said Frederic Roeder, vice president of the nonprofit Global Citizen Group.

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

“But without developing countries, there will be no sustainable recovery for the global economy,” she said.

(Andrea Shalal reports). Editing by Mark Porter and Lisa Schumaker

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