US-led infrastructure fund to counter China in Indo-Pacific
CANBERRA: The United States, Japan and Australia agreed yesterday to invest in infrastructure projects in the IndoPacific in a move that will be seen as a counter to China’s rising influence in a region that stretches from the east coast of Africa, through Australia to Hawaii in the Pacific Ocean.
“This trilateral partnership is in recognition that more support is needed to enhance peace and prosperity in the IndoPacific region,” Australia Foreign Minister Julie Bishop said in an emailed statement.
The pact will mobilise investment in energy, transportation, tourism and technology infrastructure, according to the statement, which didn’t give any funding details.
The announcement comes after US President Donald Trump’s National Security Strategy, released in December, called for policies to answer rival powers’ infrastructure-building efforts.
Chief among those is Chinese President Xi Jinping’s Belt and Road Initiative, a global plan to build or expand highways, railways, ports, pipelines and power plants that Morgan Stanley forecasts could grow as large as $1.3 trillion over the next decade.
US infrastructure cooperation with Japan and Australia would dovetail with the Trump administration’s evolving national security policies, which have cast the US as in “long-term, strategic competition” with China and Russia.
Before visiting China in November, Trump signed two deals with Japan, pledging cooperation on infrastructure projects in the region.
In February, Bishop said the three nations, along with India, had discussed opportunities to address “the enormous need for infrastructure” in the region, which encompasses some of the world’s poorest as well as fastest-growing economies.
India wasn’t mentioned in the announcement. Instead, the pact will be organised by the US’s Overseas Private Investment Corp, the Japanese Bank for International Cooperation and Australia’s Department of Foreign Affairs and Trade.
“This partnership represents our commitment to an Indo-Pacific region that is free, open and prosperous,” the three nations said in a joint statement. “By working together, we can attract more private capital to achieve greater results.”
No funding arrangements were announced in the statement.
“The trilateral partnership will be formalised in due course,” Bishop said.
Australia’s diplomatic relationship with China, its most important trading partner, has been strained since December when Prime Minister Malcolm Turnbull said Chinese meddling in the nation’s government and media were a catalyst for new anti-foreign interference laws, which passed parliament last month.
China lodged a formal protest with Australia in January after Turnbull’s minister for international development, Concetta Fierravanti-Wells, said the Belt and Road plan risked building “useless buildings” and “roads to nowhere.”