In late June 2022, almost a decade after China’s Belt and Road Initiative (BRI) started in 2013, the G7 finally launched its counteroffensive: the Partnership for Global Infrastructure and Investment (PGII), which is a 5-year plan to mobilize funds of up to $600 billion in the public and private sectors, from governments, multilateral institutions, development finance institutions, sovereign wealth funds, to banks, insurers and the capital markets.
The PGII, which is also primarily a coordination mechanism for the varied development initiatives of G7 countries targeted at Africa and the broader developing world, will focus on 4 key areas: clean energy, digital connectivity, health and gender equality.
The United States, which will facilitate a third of the funding (about $200bn), has a clear interest in this new strategy, as have the other rich countries of the G7. Over the past decade, China has risen in influence in Africa to rival, sometimes outshine, the West, the costs to which became all too evident from the ambivalence of African leaders towards the West’s mobilization of support for sanctions against Russia, after it invaded Ukraine in early 2022.
There is scepticism about whether the PGII is not just another one of many such initiatives already seen in the past, that after all the initial excitement that greets their announcement, sooner than later lose steam, as donor countries move on to new priorities
There is scepticism about whether the PGII is not just another one of many such initiatives already seen in the past, that after all the initial excitement that greets their announcement, sooner than later lose steam, as donor countries move on to new priorities. Until yet another time comes when the clouds gather into a potential storm for global geopolitics that African support could help mitigate.
Africa’s external creditors (2000-20)
Source: David, M. & Christoph, T. (2022). Who lends to Africa and how? Introducing the Africa debt database, Kiel Working Paper, No. 2217, Kiel Institute for the World Economy (IfW Kiel), Kiel.
China’s competition and climate action are key motivations
The focus on infrastructure is particularly instructive, as it is straight out of the playbook of China, which rightly assessed that in spite of the corruption and misgovernance on the continent, there was a genuine desire for infrastructure, a win-win for its leaders’ desire for big symbols and gestures, the kind of populism that they need to remain in power.
The PGII, which is a successor programme to the American Build Back Better World (B3W) initiative unveiled at the G7 summit in 2021, will be different from China’s BRI in one key aspect: The infrastructure projects will give the utmost priority to environmental, social and governance (ESG) issues, which is something the Chinese have not been particularly keen on.
Other members of the G7 have since gone on to launch their own development initiatives aimed at Africa and the broader developing world, most of which are themed around climate action goals. The European Union’s €150 billion Global Gateway Africa–Europe Investment Package is aimed at accelerating transitions to a green and digital economy, as well as sustainable growth, decent job creation, in addition to strengthening the continent’s health and education systems. Through its Clean Green Initiative, which was launched at COP26 in November 2021, the United Kingdom aims to facilitate green and sustainable solutions in developing countries, many of which are African.
With respect to energy, these initiatives are fundamentally aimed at achieving net-zero emission goals. Thus, while on the one hand, the world’s wealthiest countries have a geopolitical imperative to counter China’s rising influence in Africa and the global south, the climate exigency of transitioning the world towards net zero emissions is also a key motivation, especially with respect to energy.
Africa is conflicted somewhat, as even as it has not been able to achieve energy sufficiency with fossil fuels thus far, it is now faced with the untimely dilemma of potentially being an outlier with respect to the global drift towards cleaner energy sources, which even for rich countries, are not scalable enough to eclipse fossil fuels as yet.
An edited version was originally published by the Italian Institute for International Political Studies in Milan, Italy.
See link viz: https://www.ispionline.it/en/pubblicazione/la-partita-globale-degli-investimenti-36464
