Biden Gambles on Developing Economies as Xi Opts Out of G20
While expressing his disappointment over Chinese President Xi's absence, President Biden sees an opportunity to influence the direction of a political club that has posed challenges for Washington, particularly as China's economy faces instability. As President Biden prepares for the upcoming Group of 20 (G20) meeting in India, he extends an offer to the "Global South": regardless of China's economic situation, the United States is willing to support their development.
With a substantial commitment to the World Bank and assurances of ongoing U.S. involvement, President Biden aims to convince rapidly growing economies in Africa, Latin America, and Asia that there is a viable alternative to China's Belt and Road initiative. This Chinese project has injected billions of dollars into developing nations but has also left many of them burdened with substantial debt. One significant advantage President Biden possesses is the absence of Chinese President Xi Jinping from the G20 meetings.
President Biden's strategy revolves around proposals for reforming the World Bank and increasing financial support for the institution's climate and infrastructure assistance programs in the developing world. These measures could unlock hundreds of billions of dollars in new funding for grants and loans.
To support this effort, the White House is requesting $3.3 billion from Congress, supplementing prior actions by the United States and its close allies to secure $600 billion in public and private investments by 2027 for the Partnership for Global Infrastructure and Investment. This alternative to the Belt and Road initiative excludes China from the equation.
Zack Cooper, a senior fellow specializing in Asia at the American Enterprise Institute, noted, "Xi's absence from the G20 does give the United States an opening, which could be compounded by the challenges that China's economic downturn will have for Belt and Road spending."