The Dragon's Curse? China, the World Bank, and Perceptions of Corruption in Tanzania

The rise of China as a “non-traditional” development partner has been one of the most important phenomenon in the field over the past decade but the implications of this emergence are not yet fully understood. The lack of transparency in Chinese aid programs, coupled with an apparently uninterested stance towards the governance implications of development, lead many to wonder if Chinese engagement will contribute to or undermine development efforts, particularly those of traditional donors such as the World Bank. This paper takes advantage of recent innovations in development aid data to investigate the spatial relationship between Chinese aid, World Bank aid and citizen perceptions of corruption in Tanzania. The paper finds a strong association between the location of a larger number of Chinese aid projects and higher perceptions of corruption. The paper also finds evidence that the presence of a large number of Chinese aid projects may undermine the “beneficial” relationship between World Bank aid projects and perceptions of corruption. However, both of these findings are qualified by the inability to disentangle the association with these aid projects from the association with similarly co-located natural resources, which may be an alternative driver of corruption via the “resource curse”.