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Build Back Better, world edition: G7 countries want to fund global infrastructure to rival China

Snacks / Tuesday, June 15, 2021

Friends Reunion vibes... G7 countries have been getting cozy lately. The Group of Seven = the US, UK, Canada, France, Germany, Italy, and Japan. This month, G7 leaders schmoozed over tea at a London summit — and agreed on backing a 15% global minimum corporate tax rate. France decided to ship another Statue of Liberty to the US as a gift of friendship (#aw). Now, the G7 is bonding over a global infrastructure initiative:

  • Build Back Better World: Doesn't exactly roll off the tongue. The G7 announced the initiative on Sunday, inspired by Biden’s "Build Back Better" plan for the US.
  • Global ambitions: You can tell by the addition of "World" at the end. G7 nations would help finance infrastructure projects in developing countries. Think: roads, bridges, and clean energy infrastructure.
  • German Chancellor Angela Merkel: "For countries in need of development, only concrete projects count.” Pun intended?

Rare bipartisan support topics ... Extra vacation days, and countering China’s power (it's a theme). With Build Back Better World, the G7 hopes to rival China's multi-trillion-dollar "Belt and Road" initiative. China’s ambitious program aims to build physical and digital infrastructure connecting hundreds of countries. It's a way for China to expand its global influence. BBBW is a way for the US and friends to counter that.

The real winners could be companies... When the US took on Russia during the Cold War, American military contractors made big profits. Today’s tension with China is less about weapons, more about tech power. This month, the Senate approved a $250B bill to boost government spending on tech R&D to keep the US competitive against China (think: more US-made chips). This global infrastructure initiative could benefit American tech, telecom, and energy companies, too.

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