G7 rivals China with grand infrastructure plan

The G7, whose leaders are meeting in southwestern England and who discussed strategic competition with Beijing, has been searching for a coherent response to the growing assertiveness of Xi after China's surging economic and military rise over the past 40 years. 

U.S. President Joe Biden and other G7 leaders hope the plan, known as the Build Back Better World (B3W) initiative, will provide a transparent infrastructure partnership to help narrow the $40 trillion needed by developing nations by 2035, the White House said. 

"This is not just about confronting or taking on China," a senior official in Biden's administration said. "But until now we haven't offered a positive alternative that reflects our values, our standards and our way of doing business." 

The G7 and its allies will use the initiative to mobilise private sector capital in areas such as climate, health and health security, digital technology, and gender equity and equality, the White House said. 

It was not immediately clear how the plan would exactly work or how much capital it would ultimately allocate. 

China’s Belt and Road Initiative (BRI) is a multi-trillion-dollar infrastructure scheme that Xi launched in 2013, involving development and investment initiatives that would stretch from Asia to Europe and beyond. 

More than 100 countries have signed agreements with China to cooperate in BRI projects like railways, ports, highways and other infrastructure. 

Critics say Xi's plan to create a modern version of the ancient Silk Road trade route to link China with Asia, Europe and beyond is a vehicle for the expansion of Communist China. Beijing says such doubts betray the "imperial hangover" of many Western powers that humiliated China for centuries. 

The re-emergence of China as a leading global power is considered to be one of the most significant geopolitical events of recent times, alongside the 1991 fall of the Soviet Union that ended the Cold War. 

China in 1979 had an economy that was smaller than Italy’s, but after opening to foreign investment and introducing market reforms, it has become the world’s second-largest economy and is a global leader in a range of new technologies. 

Leaders of the G7 - the United States, Canada, Britain, Germany, Italy, France and Japan - want to use their gathering in the seaside resort of Carbis Bay to show the world that the richest democracies can offer an alternative to China's growing clout. 

The U.S. official said until now, the West had failed to offer a positive alternative to the "lack of transparency, poor environmental and labour standards, and coercive approach" of the Chinese government that had left many countries worse off. 

According to a Refinitiv database, as of mid-last year, more than 2,600 projects at a cost of $3.7 trillion were linked to the Belt and Road Initiative, although the Chinese foreign ministry said last June that about 20% of projects had been seriously affected by the COVID-19 pandemic. 

As part of the G7 plan, the United States will work with the U.S. Congress to supplement existing development financing and to "collectively catalyze hundreds of billions of dollars of infrastructure investment," the White House said. 

The United States is pushing the other G7 leaders for "concrete action on forced labour" in China, and to include criticism of Beijing in their final communique from a three-day summit in southwest England, the U.S. official said. 

Biden planned to press the other leaders to make clear that they believe forced labour practices are an affront to human dignity and "an egregious example of China’s unfair economic competition". 

"We’re pushing on being specific on areas like Xinjiang where forced labour is taking place and where we have to express our values as a G7," the official said of the final communique to be issued at the end of the summit on Sunday. 

China denies all accusations of abuse in the Xinjiang region. 

The Chinese foreign ministry did not immediately respond to a request for comment on the G7 infrastructure proposal or the U.S. official's remarks about forced labour.