US, EU Unable to Compete with China’s BRI

China’s Silk Road economic belt and 21st century Silk Road initiative (BRI) aims at having win-win cooperation with countries that need construction of infrastructures of roads, railways, power plants, etc. to facilitate their economic growth and connections with China for benefit from each other’s market. As a result both China and the country concerned have been benefited. It does not aim at enhancing China’s geopolitical influence but it may in fact enhance China’s geopolitical influence there.

That seems to worry not only the US but also EU. Their officials and media try to make BRI unpopular by the lies that BRI is China’s evil debt traps to control countries concerned with excessive debts that the borrowing countries are unable to repay. The lie they have kept repeated is China’s excessive loans to Sri Lanka for the construction of Hambantota port and thus forced Sri Lanka to repay the debt with the port. However, facts proved that a Chinese company paid about $1 billion for 85% of the shares in two Sri Lanka companies that have the right to operate the port.

Through years of efforts, BRI has become increasingly popular as its projects do have benefited both China and the countries concerned.

Finding all their lies have been broken by fact, now according to Reuters’ report “G7 aims to raise $600 billion to counter China’s Belt and Road” yesterday, they now want to raise funds to compete with China’s BRI. We may ask why the US and EU did not provide funds for poor countries’ construction of infrastructures when China was much poorer than them. They do not compete with China in win-win cooperation to benefit poor countries but want better geopolitical influence than China.

However, unlike China they do not have surplus funds for their infrastructure projects. As a result, unlike China they, whether government or private inverters want quick substantial return to their investment. As in the past 8 years, BRI has almost got all projects with quick or substantial returns there are few projects left for the US and EU. Under such circumstances it is impossible for the US and EU to raise the funds they have promised. Even if they had been able to, they would not be able to find enough projects to compete with China.

Moreover, as they lack the political stability, they cannot be sure that their government remain committed to the plan for five years. The US, especially, cannot be sure the next administration will be led by Biden or another Democratic president to remain committed to the plan. In fact, even if the next president is a Democrat, there is no guarantee that he/she will keep on implementing Biden’s plan.

The fact now is that the US cannot fix or rebuild its own poor and dangerous old roads, railways, airports and bridges or transform its poor old power plants and grids that have often suffered outage for days due to severe storm.

Comment by Chan Kai Yee on Reuters’ report, full text of which can be viewed at https://www.reuters.com/world/refile-us-aims-raise-200-bln-part-g7-rival-chinas-belt-road-2022-06-26/.

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