• 16 hours Why The Gold Rally Flatlined
  • 22 hours The Uranium Sector Can’t Catch A Break
  • 2 days Upcoming Fed Meeting Has Investors On Edge
  • 2 days Global Gold Sector Outlines Responsible Mining Principles
  • 3 days China’s Giant Vampire Fund Loses $120B
  • 3 days McDonalds To Roll Out Robot Drive-Thru Clerks
  • 3 days Savvy Investors Are Betting Big On This Little Data Company
  • 4 days How The Government Is Wasting Tax Money This Year
  • 4 days Supply Concerns Halt Expansion On Tianqi Lithium Plant
  • 4 days The World’s Biggest IPO Is Almost Here
  • 5 days The Relatively Of Money And Happiness
  • 5 days Wall Street Unfazed By Recession Fears
  • 5 days SoftBank Urges WeWork To Pause IPO Plans
  • 6 days Anti-Aging Market To Hit $55 Billion
  • 6 days JPM, Morgan Stanley Take Advisory Roles In Aramco IPO
  • 6 days Are Bonds In A Bubble?
  • 7 days The Unknown Media Giant Taking The World By Storm
  • 7 days From Millennial To Millionaire With One Simple Trick
  • 8 days The 5 Most Expensive Art Pieces Ever Sold
  • 8 days Are Gold Stocks Overbought?
The Problem With Modern Monetary Theory

The Problem With Modern Monetary Theory

Modern monetary theory has been…

Billionaires Are Pushing Art To New Limits

Billionaires Are Pushing Art To New Limits

Welcome to Art Basel: The…

Zombie Foreclosures On The Rise In The U.S.

Zombie Foreclosures On The Rise In The U.S.

During the quarter there were…

Charles Benavidez

Charles Benavidez

Staff Writer, Safehaven.com

Charles Benavidez is a writer and editor for Safehaven.com. Charles is located in New York City and has over 5 years of experiencing covering financial…

Contact Author

  1. Home
  2. Markets
  3. Other

Trump Administration Offers Alternative To ‘One Belt, One Road’

Road

The Trump administration has announced a plan to offer Asian countries an alternative to China’s ‘One Belt, One Road’ initiative, which could have been subdued somewhat by the Trans-Pacific Partnership (TPP) trade agreement, had Trump not withdrawn from it hastily last year. But the alternative is a chump change compared to what Beijing is bringing to the table.

Speaking at the U.S. Chamber of Commerce ahead of a trip to Malaysia, Singapore and Indonesia this coming weekend, Secretary of State Michael Pompeo announced $113 million in new regional investments focused on technology, energy and infrastructure.

The initiative was initially mentioned by Trump last November during his five-nation tour of Asia.

Among the new investments outlined by Pompeo, the U.S. would invest $25 million to expand its technology exports to the region and add nearly $50 million this year to help countries produce and store their energy resources.

Experts are not exactly thrilled with the plan. From the perspective of scale, China’s One Belt One Road plan crushes it and most see now way that Pompeo’s plan can compare to the billions of dollars in Chinese investment pouring into the region.

Nor has American been winning hearts and minds in Asia, needless to say.

Polls in the region have shown that America’s reputation has deteriorated since Trump withdrew the US from the Trans-Pacific Partnership (TPP) free-trade deal last January. Despite the US exit, the 11 other signatories moved ahead with a new deal signed in March.

On other side, China has been actively increasing its infrastructure loans to countries like Sri Lanka, Vietnam, Pakistan, Bangladesh, Nepal…And there is a need for investment. According to ADB, the continent needs $26 trillion in infrastructure investment by 2030, Bloomberg reported.

China's investment wheel was introduced in 2013 and centers on pumping hundreds of billions of dollars into ports, rail lines and other projects across Asia, Europe and Africa. If the U.S. is just playing the “assistance” game and throwing a few bones to Southeast Asian countries here and there, it can’t compete with Beijing’s soft-power investments that buy it influence on a massive scale and hook countries on massive debts. Related: Treasury Mulling Unilateral $100B Capital Gains Tax Cut

In July, newly appointed Malaysian Prime Minister Mahathir Mohamad launched graft probes into quite a few of Chinese-funded projects resulting with more than $20 billion have now been suspended.

Last November, Pakistan cancelled a $14 billion dam project last year, citing worries over terms. 

The core of Pompeo’s speech is that American private investment is more reliable, more trustworthy than Chinese money, much of which comes from the state level with strings attached.

Whether realistic or not, Pompeo dangled an open and vague threat to Beijing, saying the U.S. would “oppose any country” that seeks to dominate the region.

“Like so many of our Asian allies and friends, our country fought for its own independence from an empire that expected deference…We thus have never and will never seek domination in the Indo-Pacific, and we will oppose any country that does,” Pompeo said.

By Charles Benavidez for Safehaven.com

More Top Reads From Safehaven.com

Back to homepage

Leave a comment

Leave a comment