CIDOB opinion 681, issued in July 2021, discusses the Belt and Road Initiative (BRI), China's primary foreign policy project initiated in 2013 with aims to connect China with Asia, Africa, and Europe through infrastructure financing. The BRI has attracted support from over 70% of the international community, involving 139 countries, aiming to reduce the global infrastructure deficit estimated by the World Bank at $18 trillion until 2040 and spur development in recipient countries.
However, the BRI is more of a successful branding campaign than a deliberate grand strategy. It consists of various Chinese donor projects, primarily public, without strategic vision or coordination. To compete, China has shortened analysis periods and lowered environmental standards, resulting in unnecessary, unprofitable, and non-economic development projects. This has led to unrepayable debts in some countries, such as Sri Lanka, where China now owns the Hambantota port.
The developed world has responded inadequately. In 2018, the EU introduced a connectivity strategy for Asia but did not surpass the BRI, leading to limited impact due to coordination issues and private capital attraction challenges. The US, in its strategic competition with China, has attempted to counteract the BRI with initiatives like the Development Finance Corporation and Blue Dot Network, which have not generated sufficient investment to rival the BRI.
In response, the EU has recently approved the "Europa Conectada Globalmente" (ECG) strategy with a more geopolitical focus to compete with the BRI. This initiative aims to offer technical assistance and higher standards, although it lacks funding. The G7 has also launched the Build Back Better World (B3W) initiative, prioritizing investments in climate change mitigation, health, digital technology, and gender equality. Both initiatives seek broad private investor participation, which could reduce their impact if these investors do not fully commit.
Maximizing impact in developing countries will require better coordination among donors, addressing the main challenge faced by the B3W and ECG. The success of branding the BRI lies in its clear mission; other initiatives struggle with this clarity. Additionally, the G7's name choice for the B3W might hinder continuity under future administrations. Despite these challenges, both initiatives are necessary steps towards increasing transparency and sustainability standards in BRI projects, enhancing European cooperation with neighboring countries, and potentially benefiting Spain in terms of infrastructure construction opportunities.
