European New Silkroad „Global Gateway“is starting

European New Silkroad „Global Gateway“is starting

Global Review and other analysts have proposed an European infrastructure project against China´s New Silkroad for quiet a long time. We once wrote:

“Instead of EU membership for mafia-like and nationalist Balkan states: An EU silk road Marco Polo 2, which expands public transport, and launches an infrastructure program that also enforces the complete digitialization of Europe. This also and above all to free the 16 states of the 16 plus 1 group from the Chinese influence again and to integrate them into the EU and to tie them to them even without EU membership. This also creates a connecting European project that acts as a counterweight to China’s New Silk Road. In contrast to abstract institutional reforms, the population can be shown a concrete material benefit of an increased EU budget that does not go into the non-binding, intransparent euro rescue packages whose beneficiaries remain hidden. A European silk road Marco Polo 2, an European analog and digital infrastructure which creats  jobs , economic growth, revitalizes Europe’s promise of prosperity, gives Europe a concrete vision and a common goal. In addition, the European New Silk Road should be an ecological, sustainable infrastructure project in contrast to the Chinese New Silk Road.”

Now this vision seems to become true. The 300 billion euro answer to China’s “New Silk Road”: is not called Marco Polo 2.?, but “Global Gateway”. The EU plans to invest up to 300 billion euros in the infrastructure of emerging and developing countries over the next six years. As can be seen from a project draft of the EU Commission * available to the German Press Agency (dpa), the money is to flow primarily into the development of environmentally friendly energy, data and transport networks. The initiative called Global Gateway will include fiber optic cables for high-speed internet, new railway lines or plants for the production and liquefaction of green hydrogen..

The background to the plans is, in particular, the rapidly growing influence of China *, which is investing internationally in infrastructure projects with its New Silk Road. For this reason, states like Germany have long been pushing for greater EU engagement in this area. Especially in Asia and Africa, China uses every opportunity to gain influence through financing entire projects. Beijing also signed various Silk Road projects in Southeastern Europe, including the notorious “Highway to Nowhere” in Montenegro *. The commitment of the Chinese shipping company COSCO, which owns the majority of the port of Athens, Piraeus, is more successful. The 300 billion euros from the new Global Gateway initiative should flow by the end of 2027. According to the plans, up to 135 billion euros of this will be mobilized through the Fund for Sustainable Development (EFSD +) and 145 billion euros through other European financial institutions. Further grants are expected from other sources. Until recently, there was talk of a significantly lower volume in connection with Global Gateway. Apparently, the EU became aware that only a big hit can compete with China’s New Silk Road *.

 Germany therefore has high hopes for the program. „Global Gateway has the potential to make the EU an effective geopolitical actor“, commented the permanent representative of the Federal Republic of Germany to the EU, Michael Clauss. The offer of rule- and value-based cooperation on equal terms will be an attractive alternative to the Chinese Silk Road for many partner countries. Global Gateway: It is important that the funds flow „The real test of Global Gateway will be whether the EU can mobilize the promised funds and channel them into high-profile strategic projects in coordination with its allies,“ commented China expert Noah Barkin from the US think tank Rhodium Group in Brussels. An EU diplomat, who did not want to be named, told the dpa that it was important to quickly follow up the first steps in implementation. If that succeeds, the partnership approach of Global Gateway could underpin the geopolitical claim of the EU and reduce China’s influence. From the perspective of the 27 EU member states, stronger international networking will also strengthen the competitiveness of the EU and reduce strategic dependencies – for example with regard to critical raw materials. Commission President Ursula von der Leyen had previously said self-critically about the EU *: “We are good at financing roads. But it doesn’t make sense for Europe to build a perfect road between a Chinese-owned copper mine and a port that is also owned by China. „Future investments need to be smarter. Global Gateway is now supposed to do this.

China has already tied more than 60 countries to itself since 2013, including Germany and Greece. The New Silk Road extends to the Rhine port in Duisburg and the seaport of Piraeus in Athens. The USA and Great Britain are also relying on the expansion of the infrastructure and the good business that goes with it. US President Joe Biden named his plan “Build Back ¬Better”.Von der Leyen is not only aiming at Europe, but also at the whole world. She presented her proposal as a complement to the US plan and an „alternative“ to China. Instead of becoming dependent on an authoritarian regime, governments and investors from all over the world should rely on democracy and European values, said the CDU politician. This is a „positive offer“. However, it is unclear whether the offer will catch on. The EU is not only coming late, it is also putting comparatively little money on the table. Only a small part of the 300 billion euros will come from the EU budget. The main burden will be borne by the 27 member states and private investors. China has budgeted $ 1.1 trillion for its Silk Road, almost four times as much. In addition, the European plans are extremely vague. Von der Leyen spoke of clean hydrogen, overseas cables and transport networks. She did not present any specific projects that could be implemented immediately. And when it comes to expanding health and education systems, which von der Leyen is now promising Africa and other continents, Europe is not necessarily a good role model, as the corona crisis shows. The biggest trump card is – at least from an EU perspective – the promise to stand up for “good governance”, that is, for good governance.

It’s about sustainability and transparency, they say in Brussels – not about the quick money and new dependencies that China is often accused of. In addition, geopolitical goals are also being pursued, von der Leyen admitted. When she took office two years ago, the CDU politician had already promised a “geopolitical commission”, but afterwards she delivered little. That should change with the “Global Gateway”. „Here you can see the geopolitical commission in action,“ said EU Commissioner Jutta Urpilainen. From now on, the „systemic rival“ China will be opposed. Ultimately, it’s about more influence – and about new business. While China is building airports, rail networks and highways around the world, the EU wants to concentrate on the lucrative markets in the digital sector and climate protection. Here, however, it competes with the USA and Great Britain, Europe is lagging behind. “Internal disputes within the Commission had held up this important geostrategic initiative for too long,” commented Reinhard Bütikofer, who heads the European Parliament’s delegation to China. But now a breakthrough is emerging, according to the Green politician. His parliamentary colleague Markus Ferber is much more skeptical. The financing is not secured, says the financial expert of the CSU. “A big hit looks different. China will not tremble in fear. „

Officially, China is quite relaxed about the Global Gateway initiative.The Global Times summarizes the Chinese expectations:  Global Gateway would lack political centrality and sustainability and endurance due to the political system, the financing was uncertain and also not very extensive, the value orientation could be rather disadvantageous, as the project is designed more as a counterweight to China and would not help the underdeveloped countries The same would apply to Biden’s B3W initiative, which will never realize the gigantic investment amount promised, especially since central banks, austerity policies and the US Congress would not allow this. Not feasible. Or as the GT quotes an expert:

“A successful global infrastructure construction plan needs at least three elements – sustainable and massive funding, unshakable determination and the spirit of inclusiveness and mutual respect for partners, and the certainty of internal politics, Lü Xiang, a research fellow at the Chinese Academy of Social Sciences in Beijing, told the Global Times on Tuesday. „The US has none, and the only thing it’s good at is to tell a good story by talking big.“

German China expert Professor van Ess comments

“In principle, it is certainly good for Africa if there are several competing initiatives from China, the EU and the USA. But the GT could be right when it smugly states that the EU could trick itself with its value orientation. Instead of goal orientation, one uses all sorts of buzzwords that have to come up today: climate, gender, values. The Africans will certainly be happy when they get energy-efficient air conditioning systems from Germany, but whether they are ready to change their society for it, is doubtful.”

However, it is the question if it is a good idea to make out of a infrastructure program a sort of half regime change and gender program.

Global Gateway has apparently startled China a bit. In the official propaganda of the CCP and the Global Times, the project is portrayed as a quasi-failure, “ rubber check”, not feasible, doomed to fail, but it does not seem so certain. Before the project could be directed against China, the spoekesman of the Chinese Foreign ministery and the CCP are now trying a hug strategy and offering the EU cooperation on connectivity.

“China, EU can forge complementarity in infrastructure connectivity: spokesperson

By Global Times Published: Dec 02, 2021 06:58 PM

China EU. Photo: VCG

China EU. Photo: VCG

China and the EU can forge complementarity in infrastructure connectivity, China’s Foreign Ministry said on Thursday, arguing against pitting infrastructure initiatives against one another, after the EU’s newly unveiled Global Gateway strategy was hyped by some as another response to the China-proposed Belt and Road Initiative (BRI).

China welcomes all initiatives that help developing countries build infrastructure and foster common development, Foreign Ministry spokesperson Wang Wenbin told reporters on Thursday.

There’s a lot of common ground between China and the EU in connectivity, and the two sides can be complementary and jointly push for global sustainable development, according to the spokesperson. 

His remarks came after the EU officially announced the Global Gateway strategy on Wednesday, which aims to mobilize 300 billion euros ($339 billion) in infrastructure spending by 2027.

The new infrastructure push, following in the footsteps of the US-led G7 initiative known as the Build Back Better World (B3W), is being hyped by some Western media as another attempt to counter the BRI.

The B3W initiative, for its part, has plans to narrow the $40-trillion-plus worth of infrastructure needed in the developing world by 2035.

Different initiatives are not supposed to be mutually replaceable or exclusive, but should instead advocate inclusiveness and coordination, Wang said. 

The BRI holds to the principles of extensive consultation, joint contribution and shared benefits, and it upholds the ideas of openness, integrity and greenness, he said, noting that the BRI, committed to enabling sustainability and improving living standards, is intended to add new impetus to global economic growth and open up new space for international economic cooperation.

During the eight years since the BRI was proposed, efforts to jointly implement the initiative have yielded fruitful achievements, resulting in tangible support for people from BRI economies and rendering the initiative highly welcome, especially among developing countries, according to Wang, vowing continued efforts on the part of China to jointly build the BRI.  

China’s cumulative direct investment in economies along the BRI routes hit $136 billion over the eight years since the BRI’s advent. 

BRI economies set up 27,000 businesses in China during the period, with cumulative actual investment totaling $59.9 billion, official data showed. 

Global Times

“Frisbee- Hu”Xijin´s assertative offenses against the projects seem to be moderated by the CCP by this new article pronouncing EU- Chinese cooperation offers. Maybe with the idea is to connect the BRI with the Global Gateway and thereby build an Eurasian connectivity bloc against Biden´s B3W and the USA. Before the nationalistic Global Times, the mouthpiece of the CCP commented the EU Global Gateway and Biden´s B3W initiative as follows:

“EU’s Global Gateway ‘another rubber check’ from West

Bloc’s feeble credentials hurt credibility of infrastructure plan

By GT staff reporters Published: Dec 01, 2021 10:28 PM

The EU on Wednesday launched a new connectivity initiative called the Global Gateway, aiming to mobilize 300 billion euros ($339 billion) in infrastructure outlays by 2027, in another attempt to counter the China-proposed Belt and Road Initiative (BRI).

The EU’s Global Gateway is essentially a new case of the West’s endless moves – right on the heels of the US-led G7 initiate known as the Build Back Better World (B3W) – to seize the ground in moral terms as such BRI counter-initiatives that tout higher standards and values-based cooperation are de facto rubber checks, international affairs observers said. 

They cited the EU’s feeble governing credentials and economic slowdown as undercutting the credibility of its new infrastructure strategy. 

Fake moral heights 

In an effort to justify the infrastructure investment proposal that intends to boost links in digital, energy and transport as well as strengthen health, education and research systems, a European Commission announcement on its website said, „The EU will offer not only solid financial conditions for partners, bringing grants, favorable loans, and budgetary guarantees to de-risk investments and improve debt sustainability – but also promote the highest environmental, social and strategic management standards.“

The infrastructure strategy’s implicit BRI rival target, as shown by its self-touted standards and values, builds on the West’s never-ceasing efforts to portray their BRI version as superior in moral terms, experts said, noting that such hypocrisy would by no means mask similar pushes that are born to be unviable.

With the Global Gateway, the EU, moving alongside the US, is orchestrating a push for their voices to be heard and followed in a global race to set trends and standards in the environment and social activities, Gao Lingyun, an expert at the Chinese Academy of Social Sciences in Beijing, told the Global Times on Wednesday.

„We will support smart investments in quality infrastructure, respecting the highest social and environmental standards, in line with the EU’s democratic values and international norms and standards,“  European Commission President Ursula von der Leyen was quoted as saying in the Wednesday announcement. 

When the EU announced in mid-September that it would implement the Global Gateway, von der Leyen said that the connectivity strategy is envisioned to be turned into a trusted brand around the world.

Similarly, the guiding principles of the US-led B3W include values-driven, good governance and strong governance, and climate-friendliness, read a White House statement in June.

The EU made it clear in the Wednesday statement that the Global Gateway and the US initiative B3W „will mutually reinforce each other.“

The much smaller Global Gateway, compared with the B3W initiative which aims to narrow the $40-plus trillion worth of infrastructure needed in the developing world by 2035, is some sort of allegiance the EU swears to the US, Gao said.

It could be the case that the EU is betting on the new infrastructure push to divert public attention away from its failed response to the coronavirus, which has been exacerbated by the rapid spread of the Omicron variant, he added.

The Omicron variant, originally detected in South Africa, poses a „high to very high risk“ to Europe, the European Center for Disease Control warned Friday.

Rubber checks

For the new connectivity strategy to not once again fade into obscurity, the EU will have to prove its prowess in funding various projects under the Global Gateway, largely beyond the bloc’s financing capabilities, analysts said.

The Global Gateway, according to the announcement, builds on the 2018 EU-Asia connectivity strategy, among several other connectivity partnerships. The EU will resort to its European Fund for Sustainable Development Plus, the financing arm of its external investment plan, that could make available „up to 135 billion euros in guaranteed investments for infrastructure projects between 2021 and 2027,“ the bloc announced Wednesday, in addition to up to 18 billion euros in grants from the EU budget.

Other than that, up to 145 billion euros in planned investment are expected from European financial and development finance institutions. 

Albeit smaller than the B3W, that still suggests the bloc will be banking on unspecified financial and development bodies to bankroll a large portion of the push, in a similarly infeasible attempt reminiscent of the B3W, experts said.

It took the Biden administration months of thorny negotiations to have a $1.2 trillion bipartisan infrastructure bill – to be implemented in phases over eight years -get passed by the House recently, rendering the gigantic $40 trillion B3W plan almost unimaginable.

Factoring in pressure faced by the US Federal Reserve and the European Central Bank (ECB) to ramp up plans to normalize monetary policy at their meetings in mid-December, it becomes increasingly infeasible for such external investment bills to come into fruition.

„In the Eurozone, Germany’s incoming chancellor Olaf Scholz and outgoing Bundesbank President Jens Weidmann sent strong signals for the ECB to prioritize price stability again instead of focusing on policy to fund indebted countries,“ economists at DBS said in a research report sent to the Global Times on Wednesday. 

The regulatory and economic fundamentals of the EU, Chinese experts said, make the continent fundamentally unviable to implement the infrastructure strategy as something more than a rubber check.

The Chinese economy, poised to overtake the EU’s by the end of the year, has proven its ability to delivery BRI projects over the past eight years since the BRI’s advent, experts said, betting on the Chinese economy’s strength and institutional prowess to honor inclusive and transparent BRI promises to continue the BRI’s trail.

In the first half of the year, China’s GDP expanded by 12.7 percent to 53.2 trillion yuan ($8.2 trillion), official data showed. This suggests the amount is closing in on the EU’s GDP of $8.33 trillion, media reported, paving the way for full-year figures to exceed the EU’s.

Feeble regimes 

The EU is a loosely-bound grouping, with the distribution of national interests within the 27-member bloc fairly divided and the continuity of policies often in doubt, observers said, saying that the group’s infrastructure plan is more prone to fail. 

„The Global Gateway plan should be effective during the term of the current European Council. But there is no guarantee as to whether it will move forward in the next term,“ Cui Hongjian, director of the Department of European Studies at the China Institute of International Studies, told the Global Times on Wednesday.

Compared with China’s political and policy stability, doubts needs to be put on the long-term nature and sustainability of this EU program, Cui said, noting that China has already proven its leadership in long-term international projects for developing countries in programs such as the Asian Development Bank-funded projects.

Observers noted that unlike China, the EU’s original intention for this project was to confront China rather than to provide real support to developing countries.

While the B3W expects to be global in scope, ranging from Latin America and the Caribbean to Africa and the Indo-Pacific, the Global Gateway strategy has plans to back projects spanning Eastern and Southern Europe, Africa, Central Asia and the Indo-Pacific, media reports said.

The vision, dreamy as it seems, stands in contrast with the bloc’s poor capability to turn its vision into reality.

Put in perspective, the EU proposed a transport, energy and digital infrastructure plan linking Asia and the bloc in September 2018, touted as the continent’s answer to the BRI.  

More than three years since, the plan, underpinned by a proposed 60 billion euro fund that could raise over 300 billion euros in 2021-27, has become almost invisible, in a striking sign of the bloc’s weakness to set its vision in motion.

US’ B3W infrastructure projects financially unfeasible, bound to fail: experts

BRI’s success combines high standards, China’s national conditions

By GT staff reporters Published: Nov 09, 2021 09:13 PM Updated: Nov 10, 2021 02:34 PM

The US has plans for its first infrastructure projects in January as part of a Group of Seven (G7) initiative touted to counter the China-proposed Belt and Road Initiative (BRI), media reported Monday, in a feeble attempt to seek validation for Washington’s existence post-COVID-19.

The US-led G7 initiative known as the Build Back Better World (B3W), essentially a political stunt to challenge the eight-year-old BRI framework and a sly trick played by the Biden administration to build momentum for the passage of the US domestic infrastructure spending package, is financially not feasible, experts said. 

They cast doubts over the viability of the colossal spending required to materialize the ulterior motives-powered B3W initiative, particularly when compared with the open and inclusive BRI.

The US eyes investments in five to 10 large infrastructure projects worldwide in January, Reuters reported on Monday, citing an anonymous senior US official.  

At least 10 promising projects in Senegal and Ghana were identified during a tour last week by a US delegation led by Daleep Singh, Biden’s deputy national security adviser, according to the report.

During a similar tour in early October, a US delegation visited Ecuador, Panama and Colombia, the official said, disclosing that another Asia tour is slated before the end of the year.

The infrastructure projects suggested by the US delegation actually have almost nothing to do with real „infrastructure,“ a Senegal government source told the Global Times via email on Tuesday.

It remains unknown what amount will be needed for the initial projects under the B3W initiative. 

Launched in June as a broader G7 program, the B3W initiative aims to narrow the $40-plus trillion worth of infrastructure needed in the developing world by 2035.

Financial overshoot 

The plan goes well beyond the funding capacities of the initiators that have been grappling with their internal infrastructure spending bills, notably the US, as their economies, underpinned by sizable quantitative easing programs, begin tapering pandemic-era stimulus, experts said, revealing the sly intentions unexpressed behind the B3W initiative.

The deal that touts itself as a better alternative to the BRI means almost a destined path to bankruptcy for the B3W membership, Gao Lingyun, an expert at the Chinese Academy of Social Sciences in Beijing, told the Global Times on Tuesday.

The B3W initiative is committed to four areas of focus, „climate, health and health security, digital technology, and gender equity and equality,“ according to a White House statement in June, envisioning to mobilize private sector capital and catalyze investments from development finance institutions from the G7 and like-minded partners.

In geographic terms, the initiative will range from Latin America and the Caribbean, to Africa and the Indo-Pacific, the statement said.   

In light of all the travails the Biden administration has gone through for a $1.2 trillion bipartisan infrastructure bill to be implemented in phases over eight years, which only passed the House on Friday after months of thorny negotiations, the $40 trillion-plus spending, arguably to a large extent on the US, seems impossible at the beginning.

A successful global infrastructure construction plan needs at least three elements – sustainable and massive funding, unshakable determination and the spirit of inclusiveness and mutual respect for partners, and the certainty of internal politics, Lü Xiang, a research fellow at the Chinese Academy of Social Sciences in Beijing, told the Global Times on Tuesday. „The US has none, and the only thing it’s good at is to tell a good story by talking big.“

The Biden administration can’t even realize the goal to renew its domestic infrastructure and has a big problem in funding. „How could it convince Congress to support a $40 trillion global infrastructure plan? And once the Republicans return to the White House and gain control of the Senate and the House in the future, how could it promise its partners the massive plan would be sustained?“ Lü said.

The vaguely planned initiative that comes eight years after the BRI was initially proposed but apparently overshoots in funding terms is considered political propaganda to rival the BRI, according to Gao.

The B3W initiative was launched when the Biden administration fought a tough battle in its home turf to get the infrastructure package passed, hinting that the initiative serves as an effective tailwind for the package to eventually get through, he added. He also said that the US government plans to have more businesses glued to the grandly phrased initiative, thus paving the way for its rivalry with China in the global infrastructure push in the post-virus era.  

Welcome, and good luck

On the part of the China-proposed BRI that has held onto openness, inclusiveness and transparency and has over the years come into impressive fruition in the BRI markets, the US-led initiative is barely a cause for concern, observers said.

In response to a question about the US-led plan, the Chinese Foreign Ministry said on Tuesday that the space for cooperation in the field of global infrastructure construction is broad, and there is no question of competition between different initiatives.  

Wang Wenbin, a spokesperson of the Ministry of Foreign Affairs, said the world needs to „build bridges“ rather than „tear down bridges; to strengthen connectivity rather than seeking decoupling; to make mutual-benefits and win-win cooperation rather than a closed-door policy and exclusiveness.“ 

„We hope the US takes concrete actions to push the joint development for all countries.“

Wang Yiwei, director of the institute of international affairs at the Renmin University of China, told the Global Times on Tuesday that „there is no need to be worried, and China welcomes any country, including the US, to make credible, inclusive and sustainable actions to help the developing world.“

The US and Western countries have emphasized a so-called „high standards or high quality,“ this is what the BRI has always insisted, „so we welcome their initiative on that. But the point is the high standards need to fit the reality and conditions of developing countries, and this is China’s advantage,“ said Wang Yiwei.

The reason why the BRI is so successful is that China has used its experience in reform and opening-up, which perfectly combined Western high standards and China’s national conditions as a developing country, to serve the projects in other developing countries, Wang Yiwei noted. 

„So without cooperation from China, the US plan is unlikely to be successful,“ Wang Yiwei said. 

„It’s obvious that Biden is busy with various ‚boondoggles‘ and loses attention to the really important issues. He picks senseless fights with countries like China and Russia, while American people look to a competent president who can effectively solve problems in the economy, the COVID-19 pandemic, and immigration,“ Lü said, noting that this makes the Democrats and Biden face a serious situation in the upcoming midterm election and even the 2024 presidential election.

One year out from the 2022 midterm elections, „58 percent of Americans say President Joe Biden hasn’t paid enough attention to the nation’s most important problems, as a majority disapproves of the way he’s handling his job as President,“ according to a new CNN Poll

Based on the current facts of US politics and the capability of the US-led G7 bloc, „We know they (the US and its Western allies) are just talking big and we know they want to compete with us, but we still welcome them to help the world together with us for better development. High quality development, infrastructure and inter-connectivity are needed for mankind,“ Wang Yiwei said.

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