Biden and G7 take on China

Ian Bremmer's Quick Take:

Hi, everybody happy Monday. Ian Bremmer here. I've got a Quick Take for you. Thought we would talk a little bit about President Biden's first trip outside the United States as president and the G7, which frankly went better than expected. I'm the guy that talks about the GZERO world and the absence of global leadership. But the desire of a lot of American allies to have a more regularized relationship with the United States that feels like a partnership and alliance is pretty high. And President Biden's willingness to play that role, irrespective of the constraints and divisions that he has back at home, it's also pretty high. And those two things aligned.


The timing also was fantastic, because the United States is now looking in the rear view mirror at coronavirus, largely. And that's almost true for the Europeans, the Brits, the Canadians, even the Japanese are getting better. So if there was ever a time to not play domestic politics for the G7 and instead, actually look ahead at what can be done on the global stage, this was it. And as a consequence, there was more progress than you would normally expect. First of all, one billion vaccines being provided, repurposed to lower and medium income countries, plus some financing. The United States providing half of that, 500 million vaccines from the United States being donated to poor countries. And I did not hear a single Senator or member of the House of Representatives, Democrat or Republican, in any way complain about the US doing that.

That's the first piece of meaningful US leadership on the global stage that I have seen that hasn't been politicized in the US in years. And that's a good piece of news because we desperately need to do more. And until everyone's vaccinated, the global economy is slow and people will continue to get sick and die, and we're not out of the woods. So that's a positive thing. The allies were happy to support it and to be seen as playing along with American leadership, I think. I would have liked to have seen more. I would have liked to have been earlier, but it's still by far the biggest announcement that's been made since coronavirus has hit. And it happened under American leadership with the G7, so that's good context.

Secondly, you got some coordination on tax policy. We knew that was coming. It'll take years to actually get ratified in the US Congress and in European individual parliaments, but it still is alignment, it's steering the ship. There was pretty strong coordination on Russia. Not that they necessarily know what to do, but that they're all mutually angry about the cyberattacks that are going on. And Biden wants to coordinate policy with the Europeans, which is why you saw the pullback on the pipeline Nord Stream 2, sanctions that the US was putting on. The view was, "Look, the pipeline is getting built anyway. With tougher sanctions under the Trump administration, and they were tougher, the pipeline was still getting built. It was probably going to be made operational." The only question is after Merkel, do the Greens take the chancellorship? Probably not. And so as a consequence, Biden's like, "Why am I doing this? Let's coordinate with the Europeans and our allies on Russia." That worked pretty well.

The big question and the most interesting piece was China. And this announcement with no details around it, given in the communique of the B3W, Build Back Better World. That is a horrible acronym. I hope they change the name. But the idea was to come up with something that could offer an alternative to China's Belt and Road. It sounds like it just came out of thin air, that's not the case at all. It's actually been discussed for over a year now. Initially it was Australia, Japan, and the United States under the Trump administration, looking for something to do that would support investment and financing of big projects in infrastructure for lower income countries around the world, where right now it's all China, all Belt and Road all the time. There's no alternative.

And you could have done it with the quad, but the Australians are in a trade war with China right now. They wanted some air cover. They certainly wanted a broader group. And the Americans and the Japanese were both happy to move in that direction. So they moved it to the G7. And the Australians, the South Koreans and the Indians, none of them members of the G7, were all invited as special guests. The only other special guests was South Africa, part of the British Commonwealth, the Brits were hosting it. So really an effort to bring the Asian allies in, bring India, a member of the quad in, and be able to get stronger consolidation in policies toward China.

Now, suddenly when the China conversation happened on Saturday, the Europeans, the French, the Germans, and the Italians, felt blindsided because they hadn't heard about what all of this meant. And the fact that a project was ready to go, a multibillion dollar telecom project in Southeast Asia, that is, I'm told, going to be announced in the next few weeks. So they pushed back and that was on Saturday. They even shut down the internet for the summit, because nobody wanted all of this dissent to get out and discussed with the staffers of the G7 that could have scuttled anything they agreed on. They figured, "Let's wait until we all know how we want to frame this in the communique, and then we can turn the internet back on." That's what actually happened. And you ended up getting largely what the Biden administration wanted, which was a lot of talk about China in the communique, a lot of things the G7 agreed they were angry about, whether its Uighurs or South China Sea, or intellectual property theft. And a willingness to set up this B3W a committee that will organize towards putting it in place.

Does it feel like we're heading more towards confrontation with China? Yes. Are the Europeans happy about that? Not particularly. But US leadership on the issue, which is significant. It's not going to be a competitor to Belt and Road, but it is looking like an alternative to digital Belt and Road, more strategic for the Americans and more aligned for a lot of the American allies.

So interesting, significant, worth talking about. More important on balance than the upcoming summit in a couple of days with Russia and Putin. I'm sure I'll talk about that too, but that's for another day. That is your Quick Take. I'll talk to everybody real soon.

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