The European Union is set to join the US, Japan and Asean in competing with China’s Belt and Road Initiative
The European Union is poised to become a stronger player in Asia with the unveiling next week of its alternative to China’s belt and road investment strategy.
The Euro-Asian connectivity strategy is expected to be agreed by the member states on Monday and formally unveiled at Thursday’s Asia-Europe Meeting in Brussels.
In addition to the strategy, the EU is also working on plans to boost investment in India and Central Asia.
Observers said the moves would increase competition for badly needed infrastructure and investment across Asia.
The EU says it intends to engage with other strategies, including the Belt and Road Initiative, the Free and Open Indo-Pacific strategies of Japan and the US, as well as Asean’s Connectivity 2025.
Asia needs more than US$1.7 trillion in infrastructure development per year, according to estimates last year by the Asian Development Bank, and observers say the increased competition to fund projects will mean better deals for the region.
Official policy documents directly contrast the EU plan with Beijing’s belt and road strategy, describing the European approach as “sustainable, comprehensive and rules-based” with the aim of “creating a level playing field and equal opportunities for all”.
The Euro-Asian connectivity strategy is “implicitly” in competition with China, said Frans-Paul van der Putten, senior researcher at Clingendael, the Netherlands Institute of International Relations, and is part of a broader push by the EU to show a united front on China policy, like the EU’s moves to introduce a foreign investment screening process following a buying spree of European high tech companies.
The text of the strategy “screams China at almost every paragraph”, said François Godement, director of the European Council on Foreign Relations’ Asia and China programme, adding that calls for transparency and openness were meant for Beijing’s attention.
The proposal “emphasises very heavily the role of other partners” across Asia beyond Beijing, as well as those outside Asia like the US and Canada, which is part of a “balancing strategy” against China, he said.
The Commission has proposed an increase of €60 billion (US$69 billion) to the bloc’s foreign investment framework, a large portion of which will go to Asia, and which it expects will leverage further financial resources from the private sector.
