China, US are not the only nations that support overseas development
The United States has announced a multibillion plan for infrastructure investment in the Asia-Pacific region in what could be seen as a direct response to China’s ambitious “Belt and Road Initiative”.
While he made no reference to the Beijing-led scheme, US Secretary of State Mike Pompeo said on Monday that the “Indo-Pacific Economic Vision” would increase the financial support the US provided to countries in the region through a proposed merged agency, the US International Development Finance Corporation.
Along with US$113 million in direct government investment, the plan would double the global spending cap for the agency to US$60 billion, which could be used to provide private companies with loans for projects overseas, he said.
The direct investment would be in new technology, energy and infrastructure initiatives, Pompeo said. The US would also spend US$25 million to expand technology exports to the region, add nearly US$50 million to help countries produce and store their energy resources, and create a new support network to boost infrastructure development.
Despite Beijing’s and Washington’s massive investment plans for Asia, they are not the first to support socioeconomic development programmes in the region or elsewhere.
Here are some of the others:
China might like to think it is leading the way with its belt and road plan, but when it comes to infrastructure investment in Southeast Asia Japan is streets ahead. According to figures from BMI Research, since the 2000s, Tokyo’s total investment spend in the region is about US$230 billion, or about US$75 billion more than Beijing’s.
In 2016, Japan provided aid in various forms to 89 countries and regions, one of which was China.
Financial support to Beijing comprised more than US$33 million in loans, almost US$1.6 million in grants and more than US$1.8 million in the form of “technical cooperation”, according to the Japanese foreign affairs ministry.
The European Union supports the development of better trading links with Asia, and in February the European Commission released a document soliciting opinion on its Europe-Asia Connectivity plan.
More than 35 per cent of Europe’s exports go to Asia, and four of its top 10 trading partners are in the region.
The EU is the largest donor of development aid in the world, and has provided financial support for road projects in Vietnam and Laos, as well as water resource and port developments in Africa.
It also has a commitment to donate at least 0.7 per cent of the gross national income of its member nations every year.
Australian Prime Minister Malcolm Turnbull in March unveiled the “Asean-Australia Infrastructure Cooperation Initiative”.
The project “will develop a pipeline of high-quality infrastructure projects, to attract private and public investment”, Australian Foreign Minister Julie Bishop said.
The Soviet Union launched its aid and trade programme in 1953, funding for which peaked at US$1 billion in 1960. South Asian and Middle East countries were among the biggest recipients, with projects including a steel plant at Bhilai in India and a motorway programme in Afghanistan.
When the Soviet Union collapsed in 1990, Russia halted most of its aid activity, and it was not until 2007 that Moscow drafted an aid plan, in which it said it would seek to “create a belt of good neighbourliness” along its borders and “influence global processes with a view to establishing a stable, fair and democratic world order”.
Russia’s aid budget rose to US$902 million in 2015 from US$231 million in 2010, with the money spent on a variety of programmes, from education, to health and agriculture.
Source: South China Morning Post