Macroscope | Where the G7’s alternative to China’s belt and road loses its way

We’ve already seen several initiatives portrayed by Western media as alternatives to China’s Belt and Road Initiative, but US President Joe Biden’s “Build Back Better World” (B3W) partnership is the first to be so explicitly framed as such by its sponsor.

Europe has more targeted concerns about the initiative than the United States – we care about the threat the initiative poses to our power to set global standards and about the resilience of European companies in the face of Chinese state subsidies. In Washington, the logic is more along the lines of “anything China does, the US should do better”. But, on both sides of the Atlantic, we should be wary of competition for competition’s sake.

The usual reasons given for competing with the belt and road are that its projects create difficulties for host countries. The claim is that low standards, poor implementation and problems in project selection have led to unwarranted financial burdens on countries, as well as negative social, governance and environmental impacts. In contrast, the European Union and US approaches to connectivity emphasise sustainability and a rules-based, market-led approach.

Beijing generally leaves more responsibility in the hands of host countries than Western partners. Where corruption and low standards prevail, this adherence to the “host country principle” causes problems.