Beijing has a Vision for the Global South. What about Washington?

By Matthew Rochat

On October 17-18, 2023, representatives from over 140 countries, including twenty-two heads of states and governments, gathered at Beijing’s Great Hall of the People for the third Belt and Road Forum for International Cooperation (BRF). At the opening ceremony, President of the People’s Republic of China (PRC) Xi Jinping delivered the keynote address, unveiling a new eight-point plan for the next decade of the PRC’s flagship international development strategy known as the Belt and Road Initiative (BRI). The BRF was another notable opportunity for Beijing to showcase its emerging leadership vision for the Global South. It also underscored that Washington needs a stronger vision for developing countries. If Washington wants to maintain its position of global leadership, it must utilize its own comparative strengths in collaboration with Global South partners to unleash growth and development.

The central points from Xi’s speech include a logistical corridor spanning across Eurasia by railway, road, sea, and air; a Silk Road zone of e-commerce involving free trade and investment treaties; a USD 47.8 billion “financing window” from both major development banks, the China Development Bank and the Export-Import Bank of China; an emphasis on green development with the launch of the Green Investment and Finance Partnership (GIFP); a promise to promote scientific and technological innovation including artificial intelligence; the promotion of people-to-people exchanges through art and tourism; the strengthening of transparency and integrity along the BRI; and the facilitation of multilateral cooperation through the institutionalization of a BRI secretariat.

Text analysis of the speech indicates that Xi used the words “cooperation” forty-seven times, “joint” eleven times, “connect” ten times, “friend” eight times, “together” eight times, “us” five times, and “mutual” five times. Other notable terms include twenty three mentions of “development,” fifteen references to “build,” and eleven allusions to “green.” Xi’s speech is an early indication that Beijing hopes to maintain a similar ethos of “win-win” cooperation that characterized the previous era of the BRI.

However, Xi has also indicated that the next decade of the BRI will be different than the previous. The first decade of the BRI was defined by large-scale infrastructure projects that, in some cases, involved financing greater than USD 1 billion. Many projects were dubious in terms of their environmental impact, involving the construction of coal plants or cutting down forests. The new phase will emphasize a “small is beautiful” approach to development, promoting project loans closer to USD 100 million and shorter repayment windows. In addition to smaller projects, the new approach emphasizes greener, and more socially responsible projects such as hospitals, clean energy plants, and low-carbon manufacturing.

From the perspective of the Global South, the PRC’s futuristic vision of a “global community of shared future” is a compelling sales pitch. The discourse emanating from Beijing presents an optimistic image of the future, where developing countries are active participants in world affairs. This is not limited to the BRI, but extends to three other Chinese-led initiatives referred to as the Global Development Initiative (GDI), the Global Security Initiative (GSI), and the Global Civilizational Initiative (GCI).

Moreover, at the conclusion of the August 22–24, 2023 BRICS forum–a multilateral platform for Brazil, Russia, India, China, and South Africa–South African President Cyril Ramaphosa announced that Iran, Saudi Arabia, Ethiopia, Egypt, the United Arab Emirates, and Argentina would join the bloc as new members. This new BRICS+ grouping is positioning itself as the torch-bearer for the Global South in terms of setting international standards, shaping norms, and building consensus among countries in the developing world. As the largest BRICS+ economy, the PRC is emerging as the natural leader of a non-Western-led order.

Washington would do well to learn from Beijing’s engagement with the Global South. First and foremost, if the United States wants to maintain its status as the world’s “indispensable nation,” it must aspire to be more than just a leader of the West, and become a leader for all. Notably, it must reject the urge to retrench into isolationism, and instead, grasp firmly onto the mantle of economic leadership by serving as the primary investor in the Global South. As the world’s largest economy and issuer of the still preeminent currency, channeling finance to the developing world through multilateral lending institutions such as the World Bank and the International Monetary Fund should remain an utmost policy goal. Currently, these institutions provide disproportionate decision-making authority to high-income countries. Reforming the voting structure of Bretton Woods institutions would grant the Global South more control over the allocation of development finance to target projects that they deem beneficial, while also maintaining transparency and oversight for all stakeholders.

Next, the White House should strive to move beyond merely playing catch-up to the PRC. In an effort to keep pace, the Trump and Biden administrations launched a slew of under-articulated international development initiatives known by names such as the Blue Dot Network, Build Back Better World (B3W), the Partnership for Global Infrastructure and Investment (PGII), and the India-Middle East-Europe Economic Corridor. Referred to by some analysts as the “Biden Road Initiatives,” these initiatives lack as much in imagination as they do in concrete detail. The original B3W languished to the point that the name was eventually scrapped. The Biden White House claims to have mobilized USD 30 billion for its successor, the PGII, through a mix of grants, federal financing, and private sector investment. However, this figure pales in comparison to the PRC’s BRI which is estimated to have surpassed USD 1 trillion.

It is worth keeping in mind that, as the PRC’s domestic economy has slowed, it has built up significant capacity in specific sectors such as construction. BRI projects allow the PRC to alleviate bottlenecks in the domestic economy by exporting excess capacity as most BRI loan agreements require hiring of Chinese firms to execute construction contracts. The United States is not endowed with the same overcapacity in the construction sector, so simply imitating the BRI will not produce the same strategic benefits. If the United States wants to contribute to development in the Global South, it should capitalize on its own comparative advantages.

With reformed Bretton Woods institutions overseeing “hard infrastructure” projects, the White House should expand the role of agencies such as the U.S. International Development Finance Corporation, the Millennium Challenge Corporation, the Export-Import Bank of the United States, the U.S. Trade and Development Agency, the Department of Commerce, the U.S. Agency for International Development, and the U.S. Department of Agriculture who can partner with private sector actors to build “soft infrastructure.” Soft infrastructure includes any social institutions and human capital that are essential to a well-functioning society, and will be crucial in the transition toward environmentally and socially sustainable development. Prosper Africa and Power Africa are two examples of what this can look like in practice.

Engaging in development projects that utilize its competitive strengths will also benefit the United States. This will provide opportunities for U.S. firms to change the nature of the relationship with countries in the Global South. As opposed to an asymmetrical relationship defined by aid and paternalism, this new dynamic can evolve to become one of collaboration, where both sides stand to gain. This recalibration of relations on a more equal footing will give a signal that Washington does have a meaningful vision for the developing world and is genuinely committed to achieving the Sustainable Development Goals outlined in Agenda 2030. The governing administration should institutionalize multilateral engagement with the Global South by using its impressive convening power and building on the groundwork laid by the 2022 U.S.-Africa Leaders Summit.

The United States has once again shifted its attention away from development projects in the Global South in the wake of major conflicts between Russia and Ukraine, and more recently, Israel and Hamas. If the United States wants to preserve its leadership role in the world, it must maintain a measured and stable commitment to developing countries. This commitment starts with economic leadership, embracing the role as the lender of choice in Bretton Woods institutions, which should be refitted to ensure greater decision-making authority of the Global South. Rather than playing catch-up to the PRC’s BRI, the United States should use its comparative advantage in “soft infrastructure” to pursue its own unique development strategy based on partnership and mutual interest. Finally, the United States must be an active participant in multilateral forums, shaping an inclusive vision of the international order that acknowledges the growing importance of developing countries.

Matthew Rochat is a PhD candidate in the Political Science Department at the University of California Santa Barbara and an Adam Smith Fellow at the Mercatus Center.

“Forum on China-Africa Cooperation (FOCAC)” is by GovernmentZA and is licensed under CC BY-ND 2.0.