The Transformation of Transatlantic Cooperation: From Coordination to Geopolitical Competition in Global Infrastructure Financing

In June 2022, the United States (US) and the European Union (EU) announced the “Partnership for Global Infrastructure and Investment” (PGII) within the G7 institutional setting to counteract the Chinese Belt and Road Initiative. In the following years, however, both transatlantic partners shifted from coordination to competition in global infrastructure and investment financing. To capture the changing dynamics in the politics of transatlantic global infrastructure cooperation, the paper introduces a distinction between transatlantic coordination and geopolitical competition. Transatlantic coordination is characterized by joint initiatives and instruments, absolute gains, and positive-sum games. Geopolitical competition, in turn, includes unilateral action, relative gains, and zero-sum games. In a second step, the paper explores the mechanisms that explain the shift from coordination to competition. The paper argues that this change results from preference disalignment over the distribution of gains, the perception of coordination as a zero-sum game, and the move to a more transactional approach in the transatlantic relations. To illustrate the argument made, the paper maps evolution from policy coordination in the case of the PGII in 2022 to geopolitical competition from 2024 on with the African Lobito Corridor case, where the EU and the US initially coordinated their actions in 2022.