7 July 2023, NIICE Commentary 8678
Narendra Kumar Arya
The leaders of the Group of Seven (G7) met in Hiroshima from 19-21st May 2023 and addressed various global challenges and priorities. According to the official website of the G7 Hiroshima Summit 2023, the Summit had nine sessions and produced five standard documents on Ukraine, Hiroshima Vision on Nuclear Disarmament, Statement on Economic Resilience and Economic Security, G7 Clean Energy Economy Action Plan and Hiroshima Action Statement for Resilient Global Food Security.
Major Issues and Points of Commitment.
During the Summit, expectedly as European nations are finding ways to cope with difficulties raised by the Ukraine crisis, the G7 leaders reprobate Russia’s illegal war of aggression against Ukraine. They expressed unwavering support for Ukraine and committed to intensifying diplomatic, financial, humanitarian, and military support. The G7 leaders reaffirmed their commitment to achieving a world without nuclear weapons while ensuring security for all. They also emphasised the importance of disarmament and non-proliferation efforts, including strengthening international treaties and export controls. However, a Chinese outlet called it an absurd scene at G7 – the bandit leader ran for police chief. The G7 leaders emphasised the importance of a free and open Indo-Pacific region based on the rule of law. They expressed support for ASEAN centrality, unity, and cooperation and reaffirmed partnerships with Pacific Island countries. The leaders recognised the need for resilience in the global economy and committed to maintaining macroeconomic stability. They emphasised the importance of inclusive and sustainable growth, addressing climate change, and reducing poverty. To overcome these problems, they also pledged to support sustainable development financing and debt relief efforts, particularly in low and middle-income countries. Additionally, the G-7 leaders directed their officials to establish the “Hiroshima AI process” to address generative AI and report back by the end of 2023.
Value-Based Approach to Global World Order
The G7 leaders showed their commitment to upholding and reinforcing the free and fair international order based on the rule of law. It was the consensus of the leaders that they oppose any attempts to change the status quo without agreement. They underscored guaranteeing rights for all, fair treatment, and collaborating with other nations on an equal footing. It was also pledged that they should work with international partners to create an inclusive, resilient world that leaves no one behind. The need to attain the Sustainable Development Goals (SDGs), revitalise international cooperation, and mobilise resources for sustainable development was called upon.
In a separate factsheet on the G7 Partnership for Global Infrastructure and Investment (PGII), the Summit expressed commitment by the G7 countries to promote “sustainable, inclusive, resilient, and high-quality infrastructure” through public and private investments. This was declared in the last Summit. The Summit members said that the partners should marshal up to $600 billion by 2027 to bridge the infrastructure investment gap in partner countries. In areas such as climate change, energy crisis, supply chain resilience, digital infrastructure, transportation networks, sustainable health systems, and gender equality, the PGII has undertaken several projects worldwide and making enormous investments.
In order to deliver goals and objectives, it asserted its endeavour to work along with like-minded partners from governments, private sector entities, and financial institutions. They made a commitment to continue to work through established country-led partnerships working groups for investments in sustainable infrastructure development along with engaging the private sector, international organisations, and partner countries. This will be under the administrative control of respective state governments.
Promoting Sustainable Energy
Sustainability is a mantra of our age and the G7 also incants this high-priority mantra. It highlighted its support and cooperation for various energy-related projects worldwide. The Team Europe-Namibia Partnership for renewable energy and hydrogen investments in Namibia with $120 million in grants and a loan of $547.9 million is already underway. Then there are Wind power plants under construction one in Vietnam ($25 million) and two in Egypt ($281 million and 240 million) with the assistance of the Japan International Cooperation Agency (JICA) and the Japan Bank for International Cooperation (JBIC). The Qaliwana/Vatutokotoko Hydropower Project on the small island of Fiji is also making progress. The Summit also underlined the fact that the construction of a Power-to-X (P2X) hydrogen power reference plant in Morocco with German involvement with a grant of up to $110 million is planned. In India also Ayana Renewable Power Ltd. received investments from British International Investment (BII) and worked with India’s National Infrastructure Investment Fund (NIIF), and the Green Growth Equity Fund (GGEF) for a Renewable solar PV project. FinDev Canada provided a $40 million loan to Genneia for greenfield renewable energy projects in Argentina, and FMO is providing a $45 million loan alongside FinDev Canada.
In line with other sustainable energy endeavours, Maranatha Energy Investment S.R.L in the Dominican Republic received a $7.7 million loan from FinDev Canada for a photovoltaic solar plant. Again, the UK government’s Foreign, Commonwealth and Development Office (FCDO) has invested $7 million into the Climate Energy Access Resilience (CLEAR) in partnership with Helios Investment Partners and PIDG’s InfraCo Africa. This fund aims to speed up decarbonisation and build climate resilience in Africa.
Resilience in Global Supply Chain and Connectivity Infrastructure
The G7 group is actively engaged in several initiatives that are focused on improving the resilience of supply chains, as well as enhancing connectivity in digital and transportation infrastructure. To connect the DRC and Zambia with global markets via Angola, the United States is investing in rail expansion and solar projects. Additionally, Kreditanstalt für Wiederaufbau of Germany is financing a railway project in Indonesia that aims to enhance urban public transport. During the Summit, it was informed that the Japan International Cooperation Agency is undertaking the financing of several transportation infrastructure projects in the Philippines, India, and Bangladesh, comprising railways, rapid transit lines, highways, and ports. The U.S. has facilitated a partnership for a multi-metals processing facility in Tanzania, targeting battery-grade nickel production. The group is also helping develop a Caribbean Maritime Intra-Regional Transport, a port in Ecuador- the Puerto Bolívar container port, modernisation of the Alexandria Area Control Centre in Egypt and a tramway in Morocco’s Rabat-Salé-Témara agglomeration.
Cobbling up Digital Infrastructure
There is tremendous competition among the major powers to establish their dominance in the digital world. The West, under the tutelage of the United States so far, had a lead in digital infrastructure, but the same is being challenged by China’s Digital Silk Route, touted by American scholars. This as a fitting reply to the Chinese act, is visible in the initiation of several digital infrastructure projects around the world, by the assembled nation’s leaders seemed to give. The European Union (EU) launched the Copernicus- Philippines program to establish an earth observation system for disaster risk management and climate change in the Philippines and also to develop sustainable connectivity packages for digital and transport infrastructure between Central Asia and Europe. Jamaica’s digital plan to bridge the digital divide, such as installing Wi-Fi networks in schools, is being supported by the EU, along with similar projects in the Digital for Development (D4D) Framework in Sub-Saharan Africa.
The Summit also unleashed the fact that the U.S. International Development Finance Corporation provided a loan to Africa Data Centres to construct a data centre in Ghana, increasing access to cloud-based technologies and boosting competitiveness. A digitally very ambitious project- the Medusa optical fiber cable project- aims to interconnect South European countries – Portugal, Spain, France, Italy, Greece and Cyprus – with North African countries – Morocco, Algeria, Tunisia & Egypt and integrate them into the “EU essential terabit R&D network.” Several other initiatives are also currently operational under the mentorship of G7 member countries, such as the Trans-Balkan Electricity Corridor, the electrification of rural Madagascar, and the Electricity Cable with Tunisia (ELMED inter-connector project, to name a few.
Enhancing Food Security and Health Systems
It was also divulged during the Summit concerning its efforts for enhancing food security and health systems, especially in developing and poor countries that JICA launched a debt facility called SAFE (Facility for Supporting Agricultural supply chain and Food Security Enhancement) with a budget of up to $1 billion to enhance food security. The facility aims to promote private capital mobilisation by providing direct lending to agri-business companies or through financial institutions in collaboration with partner institutions. AgDevCo, an African agribusiness investor, received $90 million from British International Investment (BII), Norfund, and the U.S. International Development Finance Corporation (DFC). The G7 Summit also highlighted the Global Gateway Team Europe Initiative on Manufacturing and Access to Vaccines (MAV+) claimed to be working to increase fair access to essential healthcare resources in Africa and has mobilised over $1.2 billion in partnership with e European Commission, EU Member States, and European financing institutions. The UK’s Foreign Commonwealth and Development Office (FCDO) and USAID Power Africa are investing $2.2 million in the Powering Healthcare initiative to provide energy solutions for health centres and clinics in developing countries.
Advance Gender Equality and Equity
The official document of the Hiroshima Summit underscored the fact that African Development Partners III (ADP III), a private equity fund investing across Africa, is focusing on job creation, climate change mitigation, and gender balance in collaboration with a debt facility worth up to $ 1.5 billion to improve financial access for vulnerable groups, including women and Micro, Small and Medium-sized Enterprises (MSMEs). Canada’s contribution of $31.2 million to the Mirova Gigaton Fund supports investments in clean energy and climate-smart projects.
The 2X Challenge, launched at the G7 Summit in 2018, is an undertaking to promote gender-specific investing and has successfully secured over $15 billion from 2021 to 2022 to support gender equality. In a nutshell, the G7 leaders in Hiroshima address global challenges and set forth a comprehensive agenda and claimed their commitment to a global order to reinvigorate international cooperation. However, it has a degree of rhetoricity with regard to highly held universal values. Its sideling of two major powers also smelt of focusing on maintaining Western dominance and halting the rise of Chinese influence.
Narendra Kumar Arya is an Associate Professor in Department of Political Science and International Relations, Mahatma Gandhi Central University, Bihar, India.
