Driving commercial and political engagement between Asia, the Middle East and Europe
Driving commercial and political engagement between Asia, the Middle East and Europe
Driving commercial and political engagement between Asia, the Middle East and Europe
US Secretary of State Mike Pompeo has announced an allocation of US$113 million to promote digital, energy and infrastructure connectivity in the Indo-Pacific.
In a move already described as an attempt to rival China’s Belt and Road Initiative, Pompeo said the funds “represent just a down payment on a new era in US economic commitment to peace and prosperity in the Indo-Pacific region.”
The announcement puts meat on the bones of President Trump’s Indo-Pacific vision, widely seen as an attempt to check China’s influence in the region.
The proposed investment breaks down across three areas, Pompeo said on Monday.
The first initiative is the Digital Connectivity and Cybersecurity Partnership, consisting of an initial US$25 million dollar investment to improve partner countries’ digital connectivity.
Enhancing Development and Growth through Energy – Asia EDGE – will see the US invest nearly US$50 million this year to help Indo-Pacific partners import, produce, move, store, and deploy their energy resources, Pompeo said.
The third element relates to infrastructure, with Pompeo launching an Infrastructure Transaction and Assistance Network to boost the development of infrastructure, which he said would be “done right” – perhaps a swipe at China’s BRI efforts, some of which have run into difficulties. This initiative is seeded with nearly US$30 million.
According to the South China Morning Post, the announcement is ‘likely to fuel suspicions in Beijing and worsen relations already fraught with trade tensions, even though senior officials have not said – and probably will not say – the new initiative intentionally targets China.’
US officials, however, have said that the US strategy does not aim to compete directly with the BRI, but instead offer a ‘sustainable alternative by encouraging private-sector investment’, as stated in Reuters.
The disparity in numbers supports this assessment; US$113 million pales in comparison to the predicted US$300 billion investment from China by 2030 through the BRI. It also highlights the difference between China’s large-scale government-led initiatives and the US approach, which is focused instead on private investment. That said, Pompeo emphasised that the US investments were “foundation” payments, adding that it was “clearly in America’s strategic interest to deepen engagement in the region.”
The US will also work multilaterally, as it has agreed to partner with Australia and Japan on its Indo-Pacific investment, two nations that have similar aims of a ‘free and open’ region not dominated by China.
