Before we turn to the autumn agenda, two editions from the summer archive:

Global Gateway and the contest for infrastructure influence - how Europe is trying to compete with China for the loyalty of the developing world, and why it started so late

When China launched its Belt and Road Initiative in 2013, it set out to build a network of infrastructure - ports, railways, roads, power plants, digital networks - across the developing world, financed by Chinese capital and built by Chinese companies. Over the following decade, Belt and Road reshaped the strategic landscape of Asia, Africa, and parts of Europe itself, binding dozens of countries to China through infrastructure, debt, and the relationships that large construction projects create. It was one of the most ambitious instruments of geopolitical influence of the century, and for years it had no serious competitor.

Europe’s response, when it came, was late and initially modest. It was not until 2021 that the European Union launched Global Gateway, its own initiative to finance infrastructure in the developing world - an explicit, if rarely stated outright, attempt to offer an alternative to Belt and Road and to compete for the influence that infrastructure investment confers. The initiative aims to mobilise substantial sums - a headline figure of around 300 billion euros - for infrastructure projects across the developing world, presented as a partnership offering higher standards and fewer strings than the Chinese alternative.

Whether Global Gateway can succeed - whether Europe can compete with China in the contest for infrastructure influence, having started a decade behind - is one of the more revealing tests of European power in the wider world. It is a test of whether Europe can translate its considerable economic resources into strategic influence, and of whether it can act with the speed and coherence that geopolitical competition demands.

Global Gateway is the European Union’s framework for financing infrastructure and connectivity projects in partner countries across the developing world - in Africa, Asia, Latin America, and Europe’s own neighbourhood. It covers digital infrastructure, energy and climate projects, transport networks, health systems, and education, presented under the banner of a values-based partnership.

The financing model is characteristic of how Europe operates. Rather than direct state lending of the kind that finances much of Belt and Road, Global Gateway relies on mobilising a combination of public and private capital - using public funds and guarantees to attract private investment, in the leveraged manner that the European Investment Bank and the Union’s development finance institutions have long employed. The headline figure represents the total investment the Union hopes to mobilise through this combination, not a sum of direct state spending.

The initiative’s pitch to partner countries rests on a contrast with the Chinese alternative, usually implied rather than stated. Global Gateway projects are presented as adhering to higher standards - on environmental sustainability, on labour conditions, on governance and transparency, on the financial sustainability of the debt involved. The European offer, in essence, is infrastructure without the problems that have attended some Belt and Road projects: without the opaque terms, the debt burdens that have entangled some recipient countries, the environmental and social costs, or the strategic dependencies that Chinese infrastructure has sometimes created.

The premise behind both Belt and Road and Global Gateway is that infrastructure is a source of strategic influence - that building a country’s ports, railways, and power networks creates relationships, dependencies, and goodwill that translate into political alignment.

The logic is sound and well established. A country whose critical infrastructure was built and financed by a particular power develops ties to that power - commercial relationships, technical dependencies, debt obligations, and the simple fact of gratitude or grievance that large projects generate. Infrastructure is long-lived, and the relationships it creates persist for decades. The power that builds the developing world’s infrastructure shapes the developing world’s future - its trade patterns, its technological standards, its strategic orientation.

China understood this earlier and acted on it more decisively than anyone else. Belt and Road gave China a presence and a set of relationships across the developing world that no amount of diplomacy could have purchased - and it did so in regions where Western engagement had often been declining. By the time Europe and the United States recognised the strategic significance of what China was building, China had a decade’s head start and a network of completed projects and committed partners.

Europe’s belated response reflects a recurring pattern in its strategic behaviour: a slowness to recognise geopolitical competition until it is well advanced, followed by an attempt to catch up using the economic resources that Europe possesses in abundance but has often been reluctant to deploy strategically. Whether the resources can compensate for the late start is the central question.

Global Gateway - Key Facts

Launched: 2021
Headline mobilisation target: around €300 billion
Model: leveraging public funds and guarantees to mobilise private investment
Sectors: digital, energy and climate, transport, health, education
Pitch: higher standards, transparency, sustainable debt - an alternative to Belt and Road
Strategic purpose: competing for infrastructure influence in the developing world

Global Gateway faces serious obstacles, some structural to how Europe operates and some inherent in the contest it has entered.

The first is speed and coherence. Belt and Road’s effectiveness came partly from China’s capacity to decide and act quickly - to commit financing, dispatch companies, and complete projects on timelines that a centralised system makes possible. Europe’s model, relying on the mobilisation of private capital and the coordination of multiple institutions and member states, is slower and more complex. The leveraged financing approach that allows Europe to claim large headline figures also makes the actual flow of investment harder to assemble and slower to materialise. A partner country choosing between an offer it can act on now and an offer that requires assembling a consortium of public and private financiers may prefer the former even if the latter is, in principle, better.

The second is the gap between the headline figure and the reality on the ground. Large mobilisation targets are easy to announce and hard to realise, particularly when they depend on attracting private investment to projects in countries that private investors regard as risky. Critics have questioned how much genuinely new money Global Gateway represents, as opposed to the repackaging of existing development commitments under a new strategic banner. The credibility of the initiative depends on its delivering visible projects, not on the size of the number attached to it.

The third is the question of whether Europe’s higher standards are an advantage or a handicap in the actual competition. The environmental, social, and governance conditions that make the European offer attractive in principle also make it slower, more demanding, and more expensive to deliver. A recipient government weighing a European project with extensive conditions against a Chinese project with few may find the Chinese offer more attractive in practice, whatever the long-term costs. Europe’s standards are a genuine differentiator, but they are not unambiguously an advantage in a competition where speed and ease often matter more to recipients than long-term quality.

The first misunderstanding is to overlook Europe’s scale as a development and external-financing actor. The European Union and its member states together constitute the largest provider of development assistance in the world - a fact that receives little attention in American discussions, which tend to focus on Chinese and American engagement with the developing world. Europe’s resources in this domain are vast; the question has always been whether it deploys them strategically.

The second misunderstanding is to assume that the contest for influence in the developing world is primarily a US-China affair, with Europe a minor participant. In fact, Europe has deep, long-standing relationships across Africa, parts of Asia, and Latin America - historical, commercial, and institutional ties that give it advantages China cannot easily match. Global Gateway is an attempt to mobilise these advantages strategically, and if it succeeds, Europe could be a more significant force in the contest than the US-China framing suggests.

For American policymakers and companies, the practical implication is that Europe is an actor to be reckoned with in the developing world - a potential partner in offering an alternative to Chinese infrastructure, a competitor in some markets, and a power whose engagement with the developing world is larger and more consequential than its low profile in American strategic discussion would suggest. The contest for the developing world’s infrastructure is not bilateral. Europe is in it, late but with real resources, and how it performs will shape the strategic landscape for decades.

Global Gateway is Europe’s belated recognition that infrastructure is power and that the developing world’s ports, railways, and networks are being built by someone - and its attempt, a decade behind China, to ensure that some of them are built by Europe, on European terms.

Friday’s EuroTasteDaily Review steps back from the contest with China to examine Europe’s role as the world’s largest provider of development assistance - the soft power that decades of aid, trade preferences, and engagement have built, the conditions Europe attaches to its generosity, and the question of whether Europe’s development power is a strategic asset it has never fully learned to use.