G7 Versus ‘BRI-Plus’

Authored by Anders Corr via The Epoch Times,

China’s international organizations are getting bigger and more roguish while claiming to champion a “fair” and “multilateral” international system. Autocracies and human rights abusers—including Iran, Saudi Arabia, the United Arab Emirates, Egypt, and Ethiopia—are signing up for Beijing’s vision of a world in which unelected dictators are ever more free to commit human rights abuse against their citizens and those abroad.

Democracies are opting out of this Chinese Communist Party (CCP) approach and the organizations meant to facilitate such crimes.

On Dec. 29, Argentina announced it had changed its mind and would not accept an invitation to join the BRICS countries (started by Brazil, Russia, India, China, and South Africa, and led by Beijing).

The other international organization led by the CCP, the Belt and Road Initiative (BRI), also faces trouble with its membership.

Italy, the only Group of Seven (G7) country in the group, officially left the BRI in late 2023.

The democracies that remain in CCP organizations have their own problems.

India follows a foreign policy lacking in democratic values. It engages with Russia through energy and arms purchases, for example, despite Moscow’s war against Ukraine. It neglects to condemn the aggression at the United Nations. The United States wants to attract New Delhi as an ally against Moscow and Beijing, and so has not been more vocal in its criticism. Still, there is an implied financial threat against India for its continued engagement with Russia.

South Africa is a basket case of socialism, criminality, and dysfunction. The situation is so bad that its most important state-owned company, a power utility, cannot reliably keep on the electricity. Its GDP per capita fell almost 23 percent since 2011. That even South Africa, which is a founding member of BRICS and a member of BRI since 2015, cannot leverage its China links for enough development aid to keep on the lights illustrates the poverty underlying Beijing’s claims to support international development.

The original vision of BRICS, of a set of four countries (South Africa was added later) seen by Wall Street as in the fast lane of economic growth, has now boiled down to India, one of the group’s only democracies. That growth is dependent on its trade with the G7.

Economic growth in Brazil and South Africa has continuously sputtered, and Russia and China have plateaued or worse due in part to their frequent opposition to “the West.” Beijing and Moscow are now trying to leverage the group into a currency union that will make its members immune from the kind of sanctions targeting Russia that could also be used against China, should it invade Taiwan.

The most recent BRICS joiners, announced on Dec. 29, are mostly dictators and human rights abusers.

Iran is the worst of the new bunch, with ongoing support for international terrorism against the United States and Israel through its proxies, Hamas, Hezbollah, and the Houthis. The Houthi flag includes the slogan, “God is Great, Death to America, Death to Israel, Curse the Jews, and Victory for Islam.” Belonging to an international organization with Iran should, therefore, be unthinkable.

To reverse the dynamic requires imposing economic and political costs on countries that join China’s international organizations. Sanctions on BRI and BRICS (jointly the “BRI-plus”) countries should be led by the United States, our allies, and other G7 countries, and include decreased access to alliance markets.

The United States, Europe, Japan, and other countries close to the G7, like South Korea, import much more from BRI-plus countries than vice versa. This gives the G7 more trade leverage than the BRI-plus based on the rule that the net importer in a trade relationship has more trade leverage than the net exporter, all else equal. This is consistent with former President Donald Trump’s observation, when speaking about trade with China, that “the customer is always right.”

The United States and allies can also impose costs on foreign banks that support BRI-plus countries.

On Dec. 22, the Biden administration issued an executive order authorizing new sanctions against banks in third-party countries that facilitate the breaking of bans on military exports to Russia. This will hit China and India the hardest.

Imposing costs on BRI-plus countries can also be done by holding membership in the BRI-plus as disqualifying for membership in the G7.

Countries that receive trade, aid, or other economic privileges from the G7 should be expected to shun BRI-plus and improve their observance of free elections and human rights.

Countries would thus reveal themselves as those that support democracy, or not. Only those that do should continue to be supported by the G7.