NEW YORK -- U.S. President Joe Biden's administration, along with the governments of Japan and Australia, is reviving an infrastructure initiative that would provide emerging markets an alternative to China's Belt and Road initiative.
After a prolonged period of inactivity, the Blue Dot Network -- first announced during President Donald Trump's administration -- kicked off talks among stakeholders in Paris on Monday. The meeting and the launch of an executive consultation group was convened by the Organization for Economic Cooperation and Development and funded by Washington and Canberra.
The initiative, which would certify projects meeting such standards as transparency and sustainability, is meant to galvanize the private sector to invest in infrastructure development in emerging markets. This approach has been hailed as a counter to the Belt and Road, which is characterized by heavy central planning from Beijing.
"The Blue Dot Network will be a globally recognized symbol of market-driven, transparent and sustainable infrastructure projects," the U.S. State Department said in a Monday statement, welcoming the consultation group's inaugural meeting.
Over 150 global executives, covering 96 countries, responsible for some $12 trillion of assets under management, participated in the Monday meeting, the OECD said in a statement. Panels at the event included those occupying key posts at financial institutions including Citi and JPMorgan, as well as in the public sector, such as Thailand's Government Pension Fund.
Derek Grossman, senior defense analyst at the RAND Corporation, said Australia, Japan, and the U.S. "cannot possibly match China's BRI dollar-for-dollar," which explains why the initiative focuses on certification and advisory instead of direct funding.
As such he worries that the network "falls far short of effectively 'competing' against China and frankly may come across as not only unimpressive, but even petty in the eyes of BRI recipients," referring to the Belt and Road Initiative by its acronym.
But Matthew Goodman, Daniel Runde and Jonathan Hillman, experts at the Washington-based Center for Strategic and International Studies, argued that the U.S. has unique strengths, including trillions of dollars of pension and insurance funds looking for the long-term returns that infrastructure investment can bring.
The Blue Dot Net work "could provide a high-standard certification to give investors confidence and move one step closer to infrastructure becoming an asset class," they argued in a 2020 commentary.
The Blue Dot Network was first announced in 2019 by the U.S., Japan and Australia at the Indo-Pacific Business Forum in Bangkok.
Wilbur Ross, the U.S. commerce secretary at the time, called the initiative "a multilateral approach to fostering sustainable economic growth by promoting excellence in infrastructure development and supporting alternatives to predatory lending."
Matthew Pottinger, Trump's deputy national security adviser and a key architect of the administration's China policy, said getting a "blue dot" -- a symbol of planet earth -- would be "like getting a Michelin-star rating for your restaurant."
"As that catches on, private sector players are going to want to get in and participate in those projects... So this is designed to also crowd out some of the more corrupt approaches to infrastructure investment that really threaten to undermine prosperity for all of us," Pottinger, a vocal critic of Beijing's Belt and Road initiative, said at the Raisina Dialogue in India last year.
The U.S. has been eager to get India -- the only member of the Quadrilateral Security Dialogue not part of the Blue Dot Network -- on board. New Delhi is already seen as an opponent China's infrastructure push, having refused to participate in the Belt and Road Forum both in 2017 and 2019.
The initiative will use infrastructure development principles set by the Group of 20 and the Group of Seven rich nations as a foundation for its standards, while the OECD will provide technical and operational input to the global certification process and review framework.
Goodman and Runde at CSIS expect the certification process to be costly, as "it must be rigorous enough to persuade private-sector investors to put their money into riskier places."
The creation of such a set of standards will have to involve stakeholders ranging from builders to financiers and will require intensive discussions and negotiations, they wrote in a commentary on the initiative last year, saying the process would likely take a couple of years.