The leaders of the Group of Seven (G7) nations have vowed to raise $600 billion in private and public funds in the next five years to initiate and finance infrastructure projects in developing countries.
The move is aimed mainly at countering China’s older, multitrillion-dollar Belt and Road initiative.
In the annual gathering of the leaders of the G7 block the newly renamed “Partnership for Global Infrastructure and Investment” was relaunched.
US to mobilize $200 billion for the initiative
U.S. President Joe Biden announced to mobilize $200 billion for the project over the next five years. The funds will be released in grants, federal funds and private investment and will be used to support projects in low- and middle-income countries mainly to:
- Deal with climate change
- Improve global health,
- Improve gender equity, and
- Build digital infrastructure
“I want to be clear. This isn’t aid or charity. It’s an investment that will deliver returns for everyone,” 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 to mobilize 300 billion Euros
European Commission President Ursula von der Leyen announced to mobilize 300 billion euros for the project to build up a sustainable alternative to China’s One Belt and One Road project.
The leaders of Italy, Canada and Japan also told the gathering about their plans. British Prime Minister Boris Johnson and French President Emmanuel Macron were not present at the summit, but both countries are also participating in the initiative.
Belt and Road Initiative
The multibillion-dollar Belt and Road Initiative is the modern version of the ancient Silk Road trade route from Asia to Europe and was launched by the Chinese President Xi Jinping in 2013 with an aim to initiate developmental programs in more than 100 countries.