The Economist — Diplomacy and aid in Africa

The United Nations General Assembly is one of the few great levellers in life. In it a tiny country such as Comoros, with a population of less than a million people and a land mass smaller than that of Rhode Island (America's smallest state) has the same voting power as India, with a population over a thousand times larger. Little wonder then that the great powers spend so much time courting the minnows, and showering them with aid, to keep them on side when resolutions come up before the UN.

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Abstract

Chinese “aid” is a lightning rod for criticism. Policy-makers, journalists, and public intellectuals claim that Beijing uses its largesse to cement alliances with political leaders, secure access to natural resources, and create exclusive commercial opportunities for Chinese firms—all at the expense of citizens living in developing countries. We argue that much of the controversy about Chinese “aid” stems from a failure to distinguish between China's Official Development Assistance (ODA) and more commercially oriented sources and types of state financing. Using a new database on China's official financing commitments to Africa from 2000 to 2013, we find that the allocation of Chinese ODA is driven primarily by foreign policy considerations, while economic interests better explain the distribution of less concessional flows. These results highlight the need for better measures of an increasingly diverse set of non-Western financial activities.

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