On November 4th, the US announced it’s take on the a “standard for global #infrastructure development,” the Blue Dot Network.
Essentially, the strong antagonism against China’s Belt and Road Initiative is starting to make sense, as the US quite obviously has it’s own version of the project that it wanted to pitch.
High standards deliver high impact!
— OPIC.gov (@opicgov) November 4, 2019
It is a joint project of the US Overseas Private Investment Corporation (OPIC), Australia’s Department of Foreign Affairs and Trade (DFAT), and Japan Bank for International Cooperation (JBIC). It is a global “sustainable infrastructure development in the Indo-Pacific region and around the world,” according to the OPIC press release.
The project was announced at the Indo-Pacific Business Forum in Bangkok, Thailand. It was outlined by OPIC’s David Bohigian, along with U.S. Department of State Under Secretary for Economic Growth, Energy, and the Environment Keith Krach, DFAT Deputy Secretary Richard Maude, and JBIC Governor Tadashi Maeda.
They had the following to say:
“The development of critical infrastructure—when it is led by the private sector and supported on terms that are transparent, sustainable, and socially and environmentally responsible—is foundational to widespread economic empowerment,” said Bohigian. “Through Blue Dot Network, the United States is proud to join key partners to fully unlock the power of quality infrastructure to foster unprecedented opportunity, progress, and stability.”
“This endorsement of Blue Dot Network not only creates a solid foundation for infrastructure global trust standards but reinforces the need for the establishment of umbrella global trust standards in other sectors, including digital, mining, financial services, and research,” said Krach. “Such global trust standards, which are based on respect for transparency and accountability, sovereignty of property and resources, local labor and human rights, rule of law, the environment, and sound governance practices in procurement and financing, have been driven not just by private sector companies and civil society but also by governments around the world.”
“Australia is committed to promoting high-quality infrastructure, inclusive approaches, and facilitating private sector investment in the Indo-Pacific region,” said Maude. “I’m pleased that this commitment is shared by East Asia Summit Leaders, and we look forward to working closely with our regional partners to develop Blue Dot Network to take action on this commitment.”
“Blue Dot Network is an initiative that leads to the promotion of quality infrastructure investment committed by G20 countries,” said Maeda. “As JBIC has a long history of infrastructure finance all over the world, JBIC is pleased to share such experience and contribute to further development of Blue Dot Network.”
The Blue Dot Network would specifically support the goals of the East Asia Summit Leaders, and “build upon common principles of project excellence agreed to as part of the G20 Buenos Aires Call to Action, G20 Osaka Summit Principles for Promoting Quality Infrastructure Investment, discussions around the G7 Charlevoix Commitment, and the Equator Principles.”
US Commerce Secretary Wilbur Ross had the following to say, during his speech at the Indo-Pacific Development Mission:
“It is a multilateral approach to fostering sustainable economic growth by promoting excellence in infrastructure development and supporting alternatives to predatory lending.”
He separately told the Financial Times ahead of the launch: “Each blue dot is meant to be a dot on the map that will be a safe place for companies to operate if they are interested in sustainable infrastructure projects…The point is to show seriousness about the sustainability of projects.”
And, indeed, the US is quite interested in the region.
Since the beginning of the Trump Administration, U.S. government agencies have invested more than $2.9 billion to support the economic pillar of the Indo-Pacific strategy. This investment will further be supported by the U.S. Development Finance Corporation (DFC), created by the Better Utilization of Investments Leading to Development (BUILD) Act of 2018. There are further plans for Indo-Pacific economic engagement with $60 billion in development finance to leverage greater private sector investment in emerging markets.
Two-way trade between the U.S. and the Indo-Pacific Region increased by almost 6% in 2018 to almost $2 trillion.
The cumulative stock of foreign direct investment between the United States and the Indo-Pacific increased by 5.9 percent in 2018, to $1.6 trillion. The United States is the largest source of FDI in the Indo-Pacific Region, with a total investment at the end of last year valued at nearly $866 billion.
China’s foreign direct investment in the region was $504 billion in 2017, of which $381 billion went to Hong Kong, and only $123 billion to the rest of the region.
According to FDI Markets, the number of U.S.-announced greenfield projects in the Indo-Pacific Region rose by 23 percent last year, to 1,022. ASEAN is the number-one U.S. investment destination in the Indo-Pacific for American companies. With a cumulative $271 billion invested, there is $29 billion more U.S. FDI in ASEAN than in China and Japan combined.
And the US’ increased focus on the Indo-Pacific region was underlined by Trump even back in November 2017:
“We have been friends, partners, and allies in the Indo-Pacific for a long, long time, and we will be friends, partners, and allies for a long time to come.”
In regard to the Blue Dot Network, there is little concrete information and numbers as of yet, but there are grand promises, which the US hopes would be able to compete with China’s Belt and Road. It is gaining more support throughout even beyond the Indo-Pacific region, since it is truly a “global infrastructure,” at least in China’s claims for it.
Rather, at least, instead of empty antagonism against the Belt and Road now the US has a (potential) alternative it can offer.
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