AS A COUNTER to the Belt and Road Initiative, the EU’s Global Gateway project is at least half a decade late and more than a euro short.
Brussels plans to spend 300 billion euros ($340 billion) over the next six years through loans, guarantees and grants to be invested in strategic industries in Latin America, Africa and Asia. There is no official figure for China’s BRI investment, but the most conservative estimates put it at $500 billion since its launch in 2013.
Projects with an estimated value of $2.5 trillion have had the label slapped on them, although far from all have been realised. That speaks, however, to the power of the BRI brand.
The EU aims to spread its influence and values through Global Gateway. Thus, the initiative has heavy elements of transparency and sustainability to it. Target industries include technology, energy, transport and health. Tackling climate change and global health security will be priorities.
Specific projects remain to be identified, and probably hostage to various EU member companies varying relationships with China, which is adept at picking off individual EU members when it feels its interests threatened. The stance of the new German coalition government, which is divided on how tough to be on Beijing, will be critical in this regard.
Efforts to counter the BRI by the EU and others are not new. Most recently, the United States put forward its Build Back Better World (B3W) Partnership. However, its openly anti-China stance and US leadership worried some European leaders sufficiently to ensure G7 support was watered down.
Yet even before B3W, there was the Japan Partnership for Quality Infrastructure (2015), the EU’s Asia-focused Connectivity Strategy and the Australia-Japan-United States Trilateral Infrastructure Partnership (both 2018) and the US Blue Dot Network (2019).
All lacked coordination, shared ambition and a joint strategy. In short, they lacked a brand, and certainly one as powerful as the BRI. In a nod to that, European Commission President Ursula von der Leyen said Global Gateway should become a trusted brand. Easier said than done.
China is anyway reining in its ‘debt-diplomacy’ as it re-evaluates the risks of making high-interest loans to countries that cannot afford to repay them, such as in Africa, and expands its use of Western financing concepts like public-private partnerships.
Beijing’s strategic aim will be to discourage the EU from joining the United States in a common infrastructure drive against the BRI. Just the announcement of the Global Gateway does that. However, Beijing will also seek to draw specific EU nations into its regional development initiatives where they already have interests: France and Italy in Africa, Spain and Portugal in Latin America and Germany in the Balkans and the Caucasus.