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$600 Billion Dollar “Partnership for Global Infrastructure and Investment” Laid Out By White House And G7 Leaders

By Casseb

United States of America – President Biden and G7 leaders announced yesterday their aim to form a values-driven, high-impact, transparent infrastructure partnership to satisfy the infrastructure requirements of low- and middle-income nations and promote U.S. and ally economic and national security objectives. Members of the Administration have traveled to hear directly from countries about their infrastructure needs, strengthened cooperation throughout the U.S. Government and with the G7, and closed game-changing deals.

At the G7 Leaders’ Summit in Schloss Elmau, Leaders will launch the Partnership for Global Infrastructure (PGII) to mobilize hundreds of billions of dollars and deliver quality, sustainable infrastructure that improves people’s lives around the world, strengthens and diversifies our supply chains, and creates new opportunities for American workers and businesses.

President Biden pledged $200 billion for PGII over the next 5 years through grants, Federal money, and private sector investments. They intend to invest $600 billion in global infrastructure with G7 partners by 2027. The US and its G7 partners will seek extra supportive funds from like-minded countries, multilateral development banks, development finance institutions, and sovereign wealth funds.

Important Foundational Facts Of The “Partnership for Global Infrastructure and Investment” 

  • Tackling the climate crisis and bolster global energy security through investments in climate resilient infrastructure, transformational energy technologies, and developing clean energy supply chains across the full integrated lifecycle, from the responsible mining of metals and critical minerals; to low-emissions transportation and hard infrastructure; to investing in new global refining, processing, and battery manufacturing sites; to deploying proven, as well as innovative, scalable technologies in places that do not yet have access to clean energy.
  • Developing, expanding, and deploying secure information and communications technology (ICT) networks and infrastructure to power economic growth and facilitate open digital societies—from working with trusted vendors to provide 5G and 6G digital connectivity, to supporting access to platforms and services that depend upon an open, interoperable, secure, and reliable internet and mobile networks with sound cybersecurity.
  • Advancing gender equality and equity—from care infrastructure that increases opportunities for economic participation by women, to improved water and sanitation infrastructure that addresses gender gaps in unpaid work and time use – in order to boost the global economic recovery by ensuring that half the population is not forced to sit on the sidelines.
  • Developing and upgrading the infrastructure of health systems and contributing to global health security through investments in patient-centered health services and the health workforce; vaccine and other essential medical product manufacturing; and disease surveillance and early warning systems, including safe and secure labs. Addressing the current pandemic and preventing and preparing for the next one is crucial to U.S. economic and national security.

As the partnership advances the White House stated multiple flagship infrastructure and supporting construction projects will be rolled out. The PGII (Partnership for Global Infrastructure and Investment’) flagship projects will be in addition to the lengthy list of projects already underway.

Project Examples Put Fourth By The White House Press Team

  • AfricaGlobal Schaffer (Washington, DC) and Sun Africa (Miami, FL) signed a contract with the Government of Angola to develop a $2 billion solar project in four southern provinces. Solar mini-grids, solar cabins with telecommunications, and home power kits will be included. The project will help Angola meet its climate commitments, including generating 70% carbon-free power by 2025.
  • In collaboration with G7 members, the EU, and multilateral organizations, the U.S. International Development Finance Corporation (DFC) is disbursing a $3.3 million technical assistance grant to Institut Pasteur de Dakar (IPD) for early-stage project development for an industrial-scale flexible multi-vaccine manufacturing facility in Senegal with potential annual capacity of millions of doses of COVID-19 and other vaccines, potentially using both vira and non-vira-based DFC’s grant is part of a $14 million grant financing package that also includes $3.3 million from IFC, $2 million from AFD, and $5.2 million from EIB (EIB). DFC and other development finance institutions are evaluating a loan to support IPD’s expansion to supplement EIB’s $80 million sovereign loan financing package.
  • SubCom (Eatontown, NJ) was awarded a $600 million contract to build the Southeast Asia–Middle East–Western Europe 6 cable, which will connect Singapore to France via Egypt and the Horn of Africa. The 17,000-km submarine cable will provide high-speed, reliable connectivity to the region. The U.S. Government, including the Department of State, Commerce’s Advocacy Center, EXIM, and the U.S. Trade and Development Agency’s (USTDA) commitment of nearly $4 million in additional capacity building to support five countries using SubCom’s technology, helped SubCom win the construction and deployment of the undersea fiber optic cable.
  • The U.S. Government and NuScale Power LLC (Tigard, OR) will provide $14 million for Romania’s first small modular reactor (SMR) plant. This investment is meant to mobilize a multi-billion-dollar effort and showcase U.S. ingenuity in the advanced nuclear sector, accelerate the clean energy transition, create thousands of jobs, and strengthen European energy security while upholding the highest standards for nuclear safety, security, and nonproliferation.
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  • USAID will commit up to $50 million over five years to the World Bank’s new global Childcare Incentive Fund – a $200 million public-private partnership to address the gap in suitable childcare infrastructure; boost women’s employment opportunities, productivity and income; and promote human capital and early learning for children. Bill & Melinda Gates Foundation, Conrad N. Hilton Foundation, Echidna Giving, Ford Foundation, William & Flora Hewlett Foundation, and LEGO Foundation are also partners.
  • DFC will invest up to $25 million in the Uhuru Growth Fund I-A, which will help SMEs in West Africa, including women-led businesses, grow. Nigeria, Ghana, and Cote d’Ivoire are among Africa’s largest economies. Uhuru has committed to investing at least 30% of capital in portfolio companies that support DFC’s 2X women’s economic empowerment initiative. Over 40% of Uhuru’s team members are women. Like-minded partners are also investing, including the German Development Finance Institution, the European Investment Bank, and British International Investment. DFC expects to raise $78 million through this investment.
  • Digital Invest will leverage $3.45 million in State and USAID funding to mobilize up to $335 million in investment capital for internet service providers and financial technology companies in Africa, Asia, and Latin America that use secure network equipment. This new blended finance program will promote resilient, secure digital ecosystems in developing countries.
  • USAID will invest $40 million to decarbonize and strengthen Southeast Asia’s power system by increasing regional energy trade, accelerating the deployment of clean energy technologies, and engaging private sector leaders and key development partners in shared priorities. The program will increase regional energy trade by 5% and deploy 2 gigawatts of advanced energy systems with U.S. assistance.
  • DFC will invest up to $30 million in Omnivore Agritech and Climate Sustainability Fund 3, which invests in entrepreneurs building India’s agriculture, food systems, climate, and rural economy. The Fund invests in companies that improve food security, climate resilience and adaptation in India, and smallholder farm profitability and productivity. The Fund aims to raise $130 million with a $65 million first close in 2022 and a final close in 2023. DFC expects to raise $30 million through this investment.
  • ABD group (Philadelphia, PA), a project development company, was awarded a $320 million healthcare infrastructure project in Côte d’Ivoire. It has already begun work on 10 locations. ABD Group credits the U.S.-Côte d’Ivoire MOU for commercial cooperation with laying the groundwork for this deal. The project has received $160 million in closed financing from Commerce, with another $160 million nearing completion.

President Biden’s Memorandum issued yesterday laid out an intensive expanded series of clauses. Points touched on are climate and energy security, digital connectivity, health and health security, and gender equality and equity and how they will be crucial for future development. How well countries harness their digital and technology sectors and transition to clean energy will determine their economic prosperity and competitiveness.

Countries will need new and retrofitted infrastructure, secure clean energy supply chains, and secure access to critical minerals and metals to facilitate energy access and transitions to clean energy. They will also need significant infrastructure investments to make communities more resilient to threats like pandemics, malicious cyber actors, and climate change.

The Memorandum further explains infrastructure is underinvested financially and technically and delivering high-quality infrastructure in low and middle-income countries requires helping to establish and improve institutional and policy frameworks, regulatory environment, and human capacity; defining strong engineering, environmental, social, governance, and labor standards; and structuring projects to attract private investment.

Through the PGII, the U.S. and like-minded partners will emphasize high-standards and quality investments in resilient infrastructure to drive job creation, safeguard against corruption, guarantee respect for workers’ organizations and collective bargaining as allowed by national law or similar mechanisms, support inclusive economic recovery, address environmental degradation risks, promote robust cybersecurity, promote skills transfer, and protect Ame. The PGII will promote values-driven, transparent, and sustainable infrastructure development to benefit recipient countries and communities.

The Memorandum states the bipartisan support for stronger infrastructure is there. Time will tell how the bipartisan effort will work out but Infrastructure development is bipartisan and Congress passed the Better Utilization of Investments Leading to Development Act of 2018 (BUILD Act) with bipartisan support to mobilize private-sector dollars to support economic development in low- and middle-income countries.

This can include support for projects to build infrastructure, create first-time access to electricity, start businesses, and create jobs. The BUILD Act established the United States International Development Finance Corporation (DFC), authorized a higher exposure cap for the DFC than the former Overseas Private Investment Corporation, and provided new tools to engage entrepreneurs and investors to help low- and middle-income countries access private resources to generate economic growth. The goal of the government leaders is by investments strengthen our partners, provide opportunity for people worldwide, and minimize future U.S. foreign aid.

See a complete version of the Memorandum on the Partnership for Global Infrastructure and Investment Here.

photo credit: Casseb

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Via The Bylt Team