A fresh look at China as an aid donor

 

Axel Dreher and Andreas Fuchs recently published an article titled, “Rogue Aid? The Determinants of China’s Aid Allocation,” as part of the “Foreign Aid of Emerging Donors and International Politics” project funded by the German Research Foundation. In their paper, Dreher and Fuchs use econometric methods to test whether China’s reputation as a “rogue donor” is consistent with actual patterns in Chinese aid flows. The dataset used in the paper is a synthesis of several existing sources of Chinese aid information, including AidData’s China dataset, which is a compilation of statistics from The China Commerce Yearbook (中国商务年鉴) and the Almanac of China’s Foreign Economic Relations & Trade (中国对外经济贸易年间).


Apart from sensitivity to political issues regarding Taiwan, the evidence suggests that Chinese aid is not overwhelmingly influenced by the country's commercial or political interests. Chinese aid allocation patterns seem to generally fall in line with the government’s non-interference policy. Dreher and Fuchs conclude that the use of the term “rogue aid”—see, for example, Moisès Naím's 2007 article in Foreign Policy magazine—to describe Chinese foreign aid is probably unwarranted. China, like DAC donors, uses aid to advance its strategic interests; however, it is more forthright about its policy that foreign assistance should benefit both the recipient country and the donor country.

The Dreher and Fuchs study also provides valuable information about trends in Chinese assistance; aid flows are tracked roughly from 1956 to 2006. Yet the authors admit that incomplete data limits the effectiveness of their study. They argue that greater transparency of aid flows (for more discussion of China and aid transparency, see a post from Monday on the Guardian’s Poverty Matters blog) would be beneficial to China, as it would help address concerns that China’s activities in the developing world are harmful.


This post was written by Austin Strange, a Research Assistant at the College of William and Mary.

Tags: south-south cooperationtransparency