Bangladesh Prime Minister Sheikh Hasina accepted European Union President Ursula von Der Leyen's invitation to attend the first Global Gateway Summit in Brussels as the two commemorated 50 years of diplomatic ties based on democratic values and adherence to the rule of law. Twenty countries were invited to participate in this first summit. Analysts have dubbed the Global Gateway Summit the "European version of BRI," which is seen as a challenge to China's Belt and Road Initiative (BRI).

In her address, Prime Minister Sheikh Hasina reaffirmed "friendship to all, malice to none," one of Bangabandhu Sheikh Mujibur Rahman's fundamental principles for Bangladesh's foreign policy. In her address, PM Hasina hinted that peace, shared prosperity, and economic cooperation are the cornerstones of Bangladesh's relationship with the world's powers. She pleaded with world leaders to use every effort to prevent needless arms races and wars and to use the proceeds for women's empowerment and education instead.

PM Hasina's travel to Brussels for the Global Gateway meeting suggests that Bangladesh is attempting to diversify its financial investments for infrastructure development as the government seeks alternate financial routes rather than relying solely on China. Bangladesh is also a participant in the Belt and Road Initiative, a global infrastructure development effort sponsored by China.

Strong bonds with EU

The European Union's Global Gateway Initiative is a global strategy based on particular principles for investing in infrastructure projects and establishing economic ties. The energy transition from fossil fuels to renewables, climate change, healthcare, commerce, and infrastructure development will all get funding. The Global Gateway Fund is around 330 billion euros in size. This offers up new finance options for LDCs and developing countries in already constrained funding channels owing to the rich economies' economic slump and conflict.

Since Bangladesh's war for independence, the European Union has been a long-standing collaborator. Over the previous 50 years, the bond has become gradually stronger. It is also one of Bangladesh's most important export destinations. At the inaugural edition of the conference, the EU agreed to two investment deals with Bangladesh. The first is a renewable energy package worth over 400 million euros to aid Bangladesh's green transformation.

A 350-million-euro European Investment Bank (EIB) loan that the EU is guaranteeing, as well as a 45 million euro blended support package that includes technical assistance and an investment award, make up the 400 million euros that the EU and EIB announced for renewable energy projects.

Furthermore, an associated Green Energy Transition project costing €12 million, including €7 million in German co-financing, intends to work on policy, legal framework, and investment climate to support an equitable green energy transition. This project is a component of Bangladesh's effort to decrease its dependency on fossil fuels and battle climate change. This funding will help the Mujib Climate Prosperity Plan, which seeks to have the nation produce at least 6,000 MW of energy from renewable sources, including solar power plants and wind farms, by 2030.

Fighting climate change

According to the Mujib Climate Prosperity Plan, the total predicted electricity output would reach 28,975 MW in 2030, with renewable energy accounting for 17.4 per cent of total generation. It is now just 4.6 per cent. According to recently completed research by the Centre for Policy Dialogue, this will result in a 27.8 per cent drop in the use of fossil fuels and an 80.1 per cent rise in the use of renewable energy within seven years.

The European Union and Bangladesh signed five additional cooperation actions worth an additional 70 million euros in support of the education sector to promote a decent work agenda, scale up green construction, boost effective digital governance, and prevent gender-based violence in public spaces in the country.

"We are confident that this initiative will enable developing countries such as Bangladesh to fight climate change, address infrastructure gaps, invest in renewable energy, digital innovation, healthcare, education, and much more," said PM Hasina. The Global Gateway represents friendship, collaboration, trust, and symbiotic interdependence."

She also urged the European Union to continue providing commercial facilities to emerging nations like Bangladesh for an additional six years in order to facilitate their transition from LDC graduation to prosperity. According to Bangladesh Foreign Minister AK Abdul Momen, who quoted the prime minister at a press briefing, she has asked the European Union to extend its business facilities for six years rather than three, as Bangladesh and other least developed nations are currently experiencing economic pressure as a result of the COVID-19 pandemic and Ukraine war.

Clarifying China links

The idea that Bangladesh is leaning towards China may have been dispelled thanks to Sheikh Hasina's visit. Bangladesh's main goal is building up its infrastructure; so it is sending out the message that it wants to get along well with everyone.

The EU recognises that emerging countries such as Bangladesh have a great need for cash for infrastructure development and it will be hard to turn these states away from Chinese influence unless they are provided with financial tools to meet that demand. Bangladesh's invitation to the summit implies that the thinking that Dhaka is in danger of being sucked into the Chinese debt diplomacy is exaggerated and that the government is merely seeking cash to reach its goal of being a developed country by 2041.

Bangladesh has seen sustained GDP growth of more than 6 per cent for more than a decade, and the size of the economy has quadrupled in the previous 15 years to over $450 billion. And the EU is prepared to offer funding in the form of soft concessional loans and grants.

The Global Gateway strategy embodies a Team Europe approach, bringing together the European Union, EU Member States, and European development finance institutions with the goal of mobilising 300 billion euros in public and private investments between 2021 and 2027, creating essential links rather than dependencies, and closing the global investment gap.

(The author is a security and strategic affairs analyst based in Dhaka. Views are personal. He can be reached at kamalmazumderju@gmail.com)