May 30, 2024

Some G20 leaders announce partnership for global infrastructure and investment projects expected to benefit Africa and counter China’s belt and road initiative

U.S. President Joe Biden meets with President Joko Widodo of Indonesia on the sidelines of the G20 leaders' summit in Bali, Indonesia, November 14, 2022. Photo courtesy: White House
U.S. President Joe Biden meets with President Joko Widodo of Indonesia on the sidelines of the G20 leaders' summit in Bali, Indonesia, November 14, 2022. Photo courtesy: White House

Some G20 leaders on Tuesday announced a partnership for global infrastructure and investment projects on the margins of the 2022 G20 Summit in Bali, Indonesia.

G7 leaders made a similar announcement in Germany in June, detailing how it will benefit their countries and developing nations, many in Africa.

The move is seen as a way to help develop global infrastructure but also compete against China’s Belt and Road initiative.

“At the 2022 G20 Summit in Bali, Indonesia, President Biden, Indonesian President Widodo, and European Commission President Von der Leyen co-hosted a group of G20 leaders to demonstrate their shared commitment to deepen engagement under the Partnership for Global Infrastructure and Investment (PGII) to accelerate investment in quality infrastructure in low- and middle-income countries around the world and strengthen the global economy,” read a fact sheet released by the White House.

In line with the G20 theme for 2022, “Recover Together, Recover Stronger,” PGII investments aim to create lasting positive impacts for partner countries, strengthen the resilience of communities, and support inclusive, sustainable development, as well as benefit partners’ economic security and global supply chains, reads the fact sheet.
 
“In his remarks, President Biden delivered an update on PGII’s progress and impact to date. He announced new projects and followed up on several announced in June 2022 at PGII’s G7 formal launch, providing concrete examples of how the United States and its partners are working together to mobilize capital to deliver quality infrastructure and sustainable development,” it said.

READ FULL FACT SHEET: Presidents Biden, Widodo, von der Leyen, and G20 Announce G20 Partnership for Global Infrastructure and Investment Projects

At the 2022 G20 Summit in Bali, Indonesia, President Biden, Indonesian President Widodo, and European Commission President Von der Leyen co-hosted a group of G20 leaders to demonstrate their shared commitment to deepen engagement under the Partnership for Global Infrastructure and Investment (PGII) to accelerate investment in quality infrastructure in low- and middle-income countries around the world and strengthen the global economy.
 
In line with the G20 theme for 2022, “Recover Together, Recover Stronger,” PGII investments aim to create lasting positive impacts for partner countries, strengthen the resilience of communities, and support inclusive, sustainable development, as well as benefit partners’ economic security and global supply chains.
 
On the margins of the Summit, President Biden, President Widodo, and President Von der Leyen met with leaders and ministers from Argentina, Canada, France, Germany, India, Japan, the Republic of Korea, Senegal, and the United Kingdom, to highlight PGII collaboration and support among likeminded partners globally. The leaders showcased the ways in which PGII partners are coming together to finance transformative infrastructure and to mobilize the private sector as drivers of quality global infrastructure and investment. This event comes at the end of a week of additional PGII project announcements by President Biden, including at COP, the ASEAN Summit, and in a bilateral meeting with G20 host, Indonesia.
 
In his remarks, President Biden delivered an update on PGII’s progress and impact to date. He announced new projects and followed up on several announced in June 2022 at PGII’s G7 formal launch, providing concrete examples of how the United States and its partners are working together to mobilize capital to deliver quality infrastructure and sustainable development.
 
New projects announced include:

  • Indonesia Just Energy Transition Partnership (JETP): The United States and Japan have led the International Partners Group, a collection of ten countries, to successfully launch a long-term partnership with Indonesia to pursue an accelerated and ambitious just energy transition that supports a trajectory that keeps within reach a warming limit of 1.5°C above pre-industrial levels.  The partnership is expected to mobilize over $20 billion in financing from the public sector (G7 partners and likeminded countries Norway and Denmark) and the private sector to support Indonesia’s efforts, using a mix of grants, concessional loans, market-rate loans, guarantees, and private investments.  The Indonesia JETP includes an ambitious power sector emissions reduction pathway based on the expansion of renewable energy, the phase out of unabated coal-fired electricity, as well as a commitment to a just energy transition for workers and communities.
     
  • Indonesia Millennium Challenge Corporation (MCC) Compact:  The United States and Indonesia have successfully concluded negotiations to launch a $698 million MCC Compact, supported with $649 million from the United States and $49 million from Indonesia. The Compact will support the development of high-quality, climate-conscious transportation infrastructure in five provinces; mobilize international capital in support of Indonesia’s development goals, in part by building the capacity of Indonesia’s financial markets; support coal plant decommissioning as part of the broader JETP program; and increase access to finance for Indonesia’s women-owned businesses and micro, small, and medium sized enterprise
     
  • Trilateral Support for Digital Infrastructure in the Pacific: The United States, in partnership with Australia and Japan, is supporting digital projects that will improve access to and security of digital services in the Pacific.
    • Acquisition of Telecom Assets for Network Upgrades: U.S. International Development Finance Corporation (DFC) is working with Japan Bank for International Cooperation (JBIC) to each provide $50 million to guarantee financing by Export Finance Australia (EFA) for Telstra’s acquisition of Digicel Pacific’s telecom assets in Papua New Guinea and the Pacific, leading to network upgrades that will improve security and performance. The project also supports the continued provision of affordable, high-quality mobile voice and data services to subscribers in these markets. Expansion of the network will further the adoption of innovative technologies.
       
    • Blue Dot Network Certification for Palau Spur Cable: The Trilateral-supported Palau Spur subsea cable will be used to pilot the “Blue Dot” certification framework of quality infrastructure.  A public-private U.S.-, Japan-, and Australia-backed initiative, the Blue Dot Network aims to be a symbol of quality in infrastructure, certifying projects that meet development standards and metrics, including on labor and environment
       
  • Securing Critical Minerals Supply Chains in Brazil: Building on previous support, the DFC will invest $30 million of equity in TechMet Limited for the development of a critical minerals mining platform of nickel and cobalt in Brazil, bolstering supply chain resilience for the renewable energy transition. TechMet’s Brazilian mine produces sustainably sourced nickel through an extraction process that is less water- and carbon-intensive than traditional methods. This nickel is estimated to be near the lowest quartile of carbon intensity for global nickel productio
     
  • Solar Development in Honduras: The Export-Import Bank of the United States (EXIM) is providing a $52 million loan guarantee to J.P. Morgan, who is financing Banco Atlantida’s purchase of $31 million of U.S. equipment for a 53.4 MW solar power project in Honduras. The transaction is the largest-ever solar project EXIM has financed in the Americas. The project will utilize American-made equipment from First Solar Nextracker, Shoals Technologies Group, and Cambria County Association for the Blind and Handicapped.
     
  • Investments in India’s Health Infrastructure:  The DFC will invest over $15 million in India’s health infrastructure, including support for the expansion of a chain of eye clinics for conducting corrective surgery for underserved individuals and an India-based social enterprise that manufactures safe and affordable women’s hygiene products for underserved women in non-metro areas.

Project updates included:

  • Bolstering Care Infrastructure and Economy: Since the Invest in Childcare Initiative was launched as a flagship PGII project at the G7 Summit, the World Bank stands to generate at least $180 million in funding for the initiative, including $50 million from the United States, with additional funds from Germany, Canada, and Australia. The Initiative has shortlisted 27 proposals and awarded the first grant of $2 million to a project in Somalia that is expected to benefit almost 30,000 young women and 3,000 young men and their children primarily from marginalized populations.
     
  • Expanding Digital Access: Since Digital Invest was launched by USAID and State as a PGII flagship project in June 2022, the blended finance program has attracted private sector partners and capital and advanced two key projects that will connect currently un- or under-served communities to digital access in emerging markets:
    • CSquared Liberia Fiber Backbone: $1.15 million of support under Digital Invest is leveraging nearly $2.5 million of financing from CSquared to establish a 350-kilometer national fiber network backbone in Liberia. The new backbone will extend from Monrovia to the Cote d’Ivoire and Guinea borders, provide transformative network connectivity capacity to internet service providers (ISPs) and mobile network operators, and, as a result, serve approximately one million Liberians.
       
    • Microsoft Airband ISP Incentive Fund: A Digital Invest grant of $500,000 will leverage $1.5 million from Microsoft to establish an incentive fund for ISPs providing digital access to community institutions, such as health clinics, schools, and local government facilities. This initiative will include the establishment and piloting of an Incentive Fund, managed by Resonance, to catalyze investment for and expansion of internet networks in hard-to-reach communities.
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments