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International relations

US answers Belt and Road with own Indo-Pacific investment plan

Pompeo to visit Malaysia, Singapore and Indonesia this week

U.S. Secretary of State Mike Pompeo speaks during the Indo-Pacific Business Forum at the U.S. Chamber of Commerce in Washington on July 30. (Getty Images)

NEW YORK -- The U.S. declared a "new era" in American commitment to the Indo-Pacific on Monday, with Secretary of State Mike Pompeo announcing a $113 million package aimed at developing the region's digital economy, energy sector and infrastructure.

Although Pompeo made no mention of China, experts say the plan is meant to defend U.S. interests in the region as China forges ahead with its own trade and infrastructure investment program, the Belt and Road Initiative.

Pompeo said he will leave Wednesday on a trip to Malaysia, Singapore and Indonesia, where he will discuss the plan, which he called a "whole-of-government" mission.

Speaking at the Indo-Pacific Business Forum in Washington on Monday, Pompeo said, "The Indo-Pacific, which stretches from the United States west coast to the west coast of India, is a subject of great importance to American foreign policy." He called it one of the greatest engines of the future global economy and that the American people "have a stake" in the peace and prosperity of the region.

Speaking about the pledged $113 million, Pompeo said the "funds represent just a down payment on a new era in U.S. economic commitment to peace and prosperity in the Indo-Pacific region."

Of the $113 million, an initial investment of $25 million will be made toward improving partner countries' digital connectivity to expand opportunities for U.S. tech exports. Nearly $50 million will be earmarked this year to help partners manage energy resources, with approximately $30 million to be spent on infrastructure.

At multiple points during his remarks, Pompeo appeared to take jabs at China's activities in the region. The U.S. "will never seek domination in the Indo-Pacific, and we will oppose any country that does," he said.

In explaining the concept of a "free and open Indo-Pacific," Pompeo said that "free" expresses the desire for "every nation to be able to protect their sovereignty from coercion by other countries." By "open," the U.S. is looking for "a peaceful resolution of territorial and maritime disputes," he said.

"The United States of America does not invest for political influence but rather practices partnership economics," Pompeo added.

The vision of a "free and open" Indo-Pacific region was first announced by President Donald Trump at last year's Asia-Pacific Economic Cooperation summit in Vietnam.

Alyssa Ayres, senior fellow at the Council on Foreign Relations and former deputy assistant secretary of state for South Asia, said Pompeo's speech lacked clarity on what the strategy was and that the funds were small in comparison to Chinese investments. "The $113 million is not comparable to, say, the $62 billion that China is providing for the China-Pakistan Economic Corridor. The U.S. needs to show how they are going to leverage this investment and which countries, such as Japan, India, Australia and Singapore, that it intends to cooperate with."

Ayres said that Pompeo's scheduled visit to India in September, when the U.S. and India will hold two-plus-two talks involving the foreign affairs and defense ministers, will be an opportunity to deepen discussions on the Indo-Pacific strategy.

Tanvi Madan, a fellow at the Brookings Institution and the director of The India Project at the think tank, said "there will be questions about the scale of American funding and broader involvement, as well as how this all fits in with the administration's approach to trade."

"In some ways Delhi sees the Trump administration as more clear-eyed about Beijing than its predecessor," Madan said. "But there are concerns about the nature of U.S. involvement and questions about reliability and consistency, as well as the administration's America First approach."

While Monday's announcement was presented as an economic decision made for the benefit the American people and the companies doing business in the region, it also stands to assuage fears among U.S. allies that China will fill a leadership gap left by an increasingly inward-facing White House.

Pompeo acknowledged that "some are wondering about America's role in the region" after Trump's withdrawal from the Trans-Pacific Partnership, a 12-country agreement that served as the cornerstone of former president Barack Obama's Asia strategy. The 11 countries that remain a part of the pact are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

The secretary affirmed Washington's commitment to economic engagement in the region, noting that American companies would continue to expand and advance U.S. economic interests, "while we work with our partners to craft better and higher-standard bilateral trade agreements."

"We seek to work with anyone to promote a free and open Indo-Pacific, so long as that cooperation adheres to the highest standards that our citizens demand," Pompeo said, in what appears to be criticism of China, whom the U.S. has accused of militarily overstepping its bounds and engaging in unfair trade practices.

Ken Moriyasu in New York contributed to this report.

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