US Makes Foreign Aid ‘A Great Alternative’ to China’s Belt and Road Initiative, Says MCC

Despite expectations that the Trump administration would reduce the amount of unspent foreign assistance funds, major foreign aid agencies like Millennium Challenge Corporation (MCC) will forge ahead. MCC’s work counters China’s Belt and Road Initiative.
US Makes Foreign Aid ‘A Great Alternative’ to China’s Belt and Road Initiative, Says MCC
Chinese construction labourers work at the site of a new mall, which is to be part of the Chinese-managed Shangri-La retails and office complex in Colombo, Sri Lanka on Nov. 19, 2018. Paula Bronstein/Getty Images
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Despite expectations that the Trump administration would reduce the amount of unspent foreign assistance funds, major foreign aid agencies like Millennium Challenge Corporation (MCC) will forge ahead. MCC’s work counters China’s Belt and Road Initiative.

“MCC is a great alternative and a great model that stands in contrast to Belt and Road,” MCC’s CEO Sean Cairncross said in an interview with NTDTV.

Over the past two years, the Trump administration has taken a number of measures to directly counter China’s Belt and Road Initiative. This includes the creation of the U.S. International Development Finance Corporation, which has an investment quota of $60 billion through the International Development Investment Act. The U.S. Export-Import Bank has also been restored to full financing capacity.

Millennium Challenge Corporation is also part of the U.S. foreign aid strategy, which promotes good governance and economic freedom by providing development funds to eligible developing countries.

“It’s a model of accountability and self determination, and we are there in partnership,” Cairncross said.

At the ASEAN Foreign Ministers’ Meeting in Bangkok on August 2, Secretary of State Mike Pompeo indirectly criticized China’s Belt and Road Initiative, and implied it has “imperial ambitions.”

While Beijing said the Belt and Road Initiative is aimed at promoting global trade and economic growth, experts say its real intention is to expand the country’s political influence and military presence.

“There are going to be some strategic areas where it’s going to intersect with our strategic interest, where we are going to have to up our game and we are going to have to enable an alternative. That may include things like 5-G. That may include certain ports,” Daniel F. Runde, Senior Vice President, Center for Strategic and International Studies said in an interview with NTDTV.

Sarah Rose, Policy Fellow, Center for Global Development also commented, in an interview with NTDTV. “I think in some ways there is still a question of scale, in terms of development finance a particular,” she said.

Many countries are growing increasingly concerned about the Belt and Road model.

“There are concerns about governance and corruption; there are concerns about quality; there are concerns about environmental issues; there are concerns about human rights. And then I think there’s this legitimate concern that there may be their components—of the feel like a new colonial project—a 99-year lease, just like Hong Kong having a 99-year lease,” Runde said.

A common theme among many of the experts we have interviewed on this topic is that the most important strategy for the U.S. win the competition with China—in the field of foreign aid and development—is to provide an alternative model, elevate global standards, and cooperate with the private sector.

Kitty Wang
Kitty Wang
Author
Kitty Wang is a senior reporter for NTD News. She covers a wide range of international and national news, specializing in U.S.-Asia relations. Kitty graduated from Edwin L. Cox School of Business, SMU with an MBA.
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