Through its Belt and Road Initiative, China attempted to portray itself as a supporter of developing nations’ infrastructure and economic growth, but this was merely a ploy to draw them into their debt trap. The G7 launched an infrastructure initiative as a substitute program for the developing nations to compete with China’s BRI.
According to Valerio Fabbri’s article in the Slovenian journal Portal Plus, numerous media outlets have highlighted examples of BRI disillusionment, and many of the countries that have benefited from Chinese investments have lamented China’s debt trap diplomacy as a result of the BRI. And typically, low- and middle-income nations like Sri Lanka and Pakistan are the ones who have suffered from this.
Examples from Pakistan and Sri Lanka have demonstrated how the BRI has impacted the nation’s economy. Following a significant loan taken by Sri Lanka for its 2015 elections, Colombo resorted to China for assistance with the Hambantota Port. Beijing requested assistance once talks on the defense issue were completed, ensuring that China’s military would have access to the port.
Meanwhile, in Pakistan, the Chinese authorities went around Islamabad to contact the Baloch rebels in order to guarantee the security of the critically important China Pakistan Economic Corridor (CPEC). Beijing, meanwhile, has not been overly enthused about preserving Pakistan’s economic stability.
According to the author, accepting Beijing’s assistance for infrastructure development has proven to be a poor decision for both Colombo and Islamabad, leaving both nations heavily indebted to China.
However, things deteriorated in Sri Lanka. Even necessary goods for its citizens, including food and fuel, were not imported by the nation. Even Sri Lanka declared bankruptcy, forcing its President and Prime Minister to step down. The former was even compelled to leave the nation.
BRI loans are covered in enigmatic conditions. Beijing frequently meddles in the domestic affairs of the receiving nations; recent examples of this can be found in Sri Lanka and Pakistan.
Additionally, the BRI projects are very exploitative. The Chancay Multipurpose Port Terminal, an ongoing port building project in Peru, threatens to wipe off the surrounding flora and fauna, generate significant harmful pollutants, and uproot local residents.
In light of recent geopolitical events, the G7, which consists of the EU, the US, Canada, Italy, UK, France, and Japan, as well as the European Union (EU), has unveiled the Partnership for Global Infrastructure and Investment (PGII), a different mechanism that can replace or at the very least mitigate the negative effects of China’s BRI.
US National Security Advisor Jake Sullivan was quoted by author Fabbri as saying, “(We) do think that there is increasing convergence, both at the G7 and NATO, around the challenge China poses and around the need – the urgent need for consultation and especially alignment among the world’s leading market democracies to deal with some of those challenges.”
The G7 has committed to spending USD 600 billion by 2027 as part of the PGII, but the real amount might be significantly higher because the PGII also allows for the mobilization of significant private resources.
With its focus on the human infrastructure at the center of global development objectives, the PGII effort can be a significant gain for global welfare and sustainable development, in contrast to Chinese projects plagued by low cost, lax standards, and hurried timetables.
China’s criticism of the PGII as “ill-intended” and “infeasible” is understandable. Beijing, according to the China Daily, thinks the PGII was created to compete with China.
Beijing is dubious about the PGII’s results and insists that the G7 and other nations should join the BRI. PGII is a sign that many nations are now opposing Chinese investments after a flurry of acquisitions in the last several years around the world. These investments may seem alluring in the short term, but as South Asian nations like Sri Lanka, Pakistan, and Nepal have learned, they end up being a hassle over time.