U.S.-Backed Transit Corridor Looks to Connect Europe, Middle East, Asia

Date: Monday, September 11th, 2023
Source: The Wall Street Journal

The U.S. and its partners in Europe, the Middle East and Asia will on Saturday unveil plans to build a transit corridor linking the three regions, a U.S. official said, a massive initiative that faces high hurdles but could eventually undercut China’s inroads in a key global trade route.

The project aims to connect Saudi Arabia, the United Arab Emirates and potentially Israel by freight rail, then use sea transport to reach India and Europe, spanning some of the world’s biggest economies over a total distance of more than 3,000 miles.

Principal deputy national security adviser Jon Finer said the U.S., India, Saudi Arabia, the U.A.E., EU and other G-20 partners would agree on a memorandum of understanding to “explore a shipping and rail transportation corridor that will enable the flow of commerce, energy and data from here in India across the Middle East to Europe.”

Officials from some of the other countries involved also said a preliminary agreement would come Saturday at an infrastructure event taking place on the sidelines of the G-20 summit in New Delhi.

The group of advanced and developing economies is meeting to address economic challenges that include climate change, overhauling international financial institutions and strengthening and diversifying supply chains.

Finer described the project as “expansive and ambitious,” saying the U.S. sees value in linking those three regions and that it is a way to partner to improve global infrastructure. Underpinning the plans are some major geopolitical goals of policy makers in the U.S. and Europe. One is to compete with China’s global infrastructure initiatives to curtail Beijing’s influence. Another is to boost Washington’s influence in the Middle East, where its global rivals Russia and China have gained ground in recent years. Expanding ties between Saudi Arabia and Israel, which don’t have formal relations but share suspicion of Iran, could be a further boon.

The U.S. and its European partners in recent months have stepped up plans to finance global infrastructure projects in a bid to counter China’s influence through its Belt and Road Initiative. Beijing envisioned that overseas infrastructure push, which began gaining steam in the 2010s, as directing an estimated $1 trillion toward Chinese-financed rail, roads, pipelines and ports that would link Asia with Europe, Africa and Latin America. However, Chinese ambitions for the plan have been fading more recently.

Many Western countries view the initiative as a vehicle for boosting China’s global economic and diplomatic clout. EU countries have distanced themselves from the project as they seek to reduce China’s economic influence in the region.

European Commission President Ursula von der Leyen traveled through Abu Dhabi on her way to the G-20, meeting with President Sheikh Mohamed bin Zayed on Thursday and pledging to “work across the board to reinforce” ties between the U.A.E. and the bloc.

At the G-7 leaders meeting in May in Japan, leaders pledged to drum up $600 billion in infrastructure funding for global partners, and Saturday they will convene a follow-up meeting on that initiative, the Partnership for Global Infrastructure and Investment.

U.S. national security adviser Jake Sullivan said Thursday that the White House was investing effort in the continent-spanning transit project, the contours of which were first reported by Axios.

“We believe that connectivity from India, across the Middle East, to Europe is incredibly important and will bring a significant number of economic benefits, as well as strategic benefits, to all of the countries involved,” he told reporters aboard Air Force One.

All the signatories to the agreement would commit financing, but details of cost and timelines won’t be hashed out for several more months, one of the officials said.

Israel isn’t expected to be an initial partner in building the corridor, but its inclusion along the route would help integrate it more deeply with Saudi Arabia, as the White House tries to negotiate a deal to normalize relations between the two countries. Imposing limits on its growing relationship with China has been one of Washington’s demands of Riyadh in those negotiations.

The new transit corridor would also boost relations between Washington and Riyadh, which have been strained by issues including human rights, oil policy and perceived Saudi support for Russia in its war against Ukraine.

Saudi Arabia has begun planning to boost its national infrastructure as part of multi-trillion dollar plans to transform its economy away from oil. Besides transit, it is exploring establishing new electricity and data connections across the region and beyond.

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