China WatchCan Europe Compete with China's Belt and Road Initiative?
The European Union this week launched a $340 billion “Global Gateway” fund to boost global infrastructure, which analysts say is aimed at rivaling China’s Belt and Road Initiative. But can the EU’s project compete with Beijing’s billions?
The European Union this week launched a $340 billion “Global Gateway” fund to boost global infrastructure, which analysts say is aimed at rivaling China’s Belt and Road Initiative. But can it compete with Beijing’s billions?
The EU says its Global Gateway will finance high-quality digital, climate, and energy and transport infrastructure, including fiber-optic cables, road and rail, and renewable power, primarily in developing nations.
Green Transition
“It will invest around the world to support our priorities — that is, the green and digital transition,” European Commission President Ursula von der Leyen told a press conference on Wednesday.
“Think, for example, of investment in clean hydrogen. We have partner countries that have an abundance of renewable energy. Think of wind or solar to produce hydrogen, which is of interest for them as well as us, or think of underwater data cable connecting to continents,” she told reporters. “Global Gateway will also focus on transport links, health care capacity … it will also support schools and education systems.”
The fund will offer the equivalent of $340 billion through 2027, with the majority in loans rather than grants.
Democratic Values
“We want to take a different approach. We want to show that a democratic, value-driven approach can deliver on the most pressing challenges. We want to show that it can on one hand meet local needs, but also, on the other hand, tackle the global challenges we have. And thus, in a way also, of course, benefit the European Union, because Global Gateway is also about our strategic interests around the world,” von der Leyen said.
The project is also clearly about geopolitics, said analyst Jonathan Holslag, a professor of international politics at the Free University of Brussels.
“The European Commission obviously does not want to say so, but the main objective behind the Global Gateway is to respond to China’s Belt and Road Initiative, China’s new Silk Road,” Holslag told VOA. “A lot of European companies have encountered huge competition from their Chinese rivals. They have also seen that countries are sliding into China’s orbit.”
Francesca Ghiretti, an analyst at Germany’s Mercator Institute for China Studies, told VOA the European Union should be strategic about which projects it selects, but foresees investment headed toward Africa and India.
