Archive for ‘Foreign aid’


Despite its reputation, Chinese aid is quite effective

CHINA is one of the world’s largest providers of foreign aid. But it has a reputation as a rogue donor: stories abound of shoddy projects, low environmental standards and mistreatment of workers.

A hospital built by the Chinese in Luanda, the capital of Angola, developed alarming cracks and had to be rebuilt. Aid is widely thought to have been diverted for arms purchases by Robert Mugabe’s regime in Zimbabwe. The list goes grimly on.

Stories do not abound, however, about who gets China’s aid and what it goes on. The government says that it spends about $5bn a year on assistance to other countries. But it has no aid ministry comparable to, say, Britain’s Department for International Development. Most details of the aid programme are kept secret, perhaps because the largesse is unpopular domestically. Many Chinese think that their country is too poor to give handouts and the money ought to be spent at home. When the health ministry tried to investigate whether Chinese projects in Africa made people healthier, the rest of the government flatly refused to co-operate.

The most detailed study so far of Chinese aid, published this week by AidData, a research group at the College of William and Mary in Virginia, shines a light on the murky data. The report looks at 4,400 projects which China has either committed to, is building or has finished, between 2000 and 2014. It finds that the country gave or lent about $350bn over that period—not much less than the total of American aid, which was $424bn in those years. But almost all of America’s aid is in the form of grants, compared with a fifth of China’s. The rest is concessional lending at below-market interest rates, mostly to Chinese companies working abroad—the kind of aid that used to be common in the West but went out of fashion in the 1990s because it overburdened recipients with debt. The grant component of China’s aid was $75bn, still a lot (about the same as Britain’s), but not a tidal wave of money.

Previous AidData studies of Chinese aid have been controversial. In 2013 the researchers reckoned that aid to Africa alone (which accounts for half of China’s total foreign aid) was $75bn between 2000 and 2011. Deborah Brautigam of Johns Hopkins University in Maryland said their calculation was “way off”. She criticised what she described as its excessive reliance on unreliable news reports. AidData’s new estimate appears to be better grounded. It is based more on official announcements from Chinese commercial offices abroad and from the finance and planning ministries of recipient countries.

The authors use their new numbers to look at whether Chinese aid works—an equally controversial subject. In a study published along with the data set, researchers including Bradley Parks of the College of William and Mary find that the grant kind does. They reckon a doubling of Chinese grant aid is associated with a 0.4-point increase in the rate of GDP growth of the recipients after two years. That is more than can be said for China’s no-strings-attached concessional lending, which, according to AidData, has no effect on the receiving country’s GDP. It appears to be tantamount to an export subsidy to Chinese firms, with a side order of backhanders for local elites.

On a happier note, the study looks at whether Chinese aid damages Western assistance. The researchers do this by calculating whether aid effectiveness declines in countries that receive Western aid and then get an influx of Chinese cash. It finds no decline, implying Chinese aid does not harm efforts by other donors.

Three conclusions can be drawn from AidData’s findings. First, Chinese aid could do more good in poor countries if more of it came in the form of grants, rather than cheap loans. Next, Western aid agencies should not be so wary of co-operating with the Chinese. Co-ordination is important in aid-giving because otherwise you might find, say, three aid agencies each building a hospital in the same city. Because China is regarded as a rogue, it is not roped into the co-ordination efforts among Western donors. That should change. Lastly, the paucity of information about China’s aid (despite AidData’s efforts) is caused by the opacity of China’s government. Perhaps it might consider being more open about a programme that appears, for all its flaws, to be moderately effective.

Source: Despite its reputation, Chinese aid is quite effective


Chinese Vice President hands over new equipment to Tanzania-Zambia Railway Authority – Xinhua |

Chinese Vice President Li Yuanchao on Wednesday toured the Tanzania-Zambia Railway Authority (TAZARA) in Tanzania and handed new equipment supplied under loan terms of the 15th Protocol of Economic and Technical Cooperation between China, Tanzania and Zambia.

Li handed over the equipment, including six forklifts and four mobile cranes, to Tanzanian Minister of Transport Harrison Mwakyembe on behalf of TAZARA.

The Chinese Vice President, who took a short ride on a TAZARA train to Yombo on the outskirts of the commercial capital Dar es Salaam, commended the authority and its workers for upkeeping the infrastructure which was built four decades ago.

Li, who is on a six-day official visit to Tanzania, promised to hold further discussions with his colleagues when he goes back to China to find more ways to help TAZARA.

Mwakyembe said that the assistance was part of the pledge made by the Chinese government to help improve TAZARA infrastructure and his country would continue to value the assistance rendered by the People’s Republic of China since early 1970s.

“The saying that – a friend in need is a friend indeed – was truly reflected in the assistance provided by China 40 years ago, building the TAZARA railway when Tanzania and Zambia fought to liberate other southern African countries,” said the Tanzanian minister.

Mwakyembe said TAZARA was the largest single foreign aid project undertaken by China and the track was built with the highest standards, as evidenced by the infrastructure which remained in good shape after 40 years.

The 15th Protocol of Economic and Technical Cooperation was signed by the three governments of China, Tanzania and Zambia on March 26, 2012 in the Zambian capital Lusaka, with a value of 270 million yuan (about 40 million U.S. dollars) worth of projects to be undertaken in support of TAZARA.

The protocol, which is an interest-free loan, covers the procurement and supply of 18 passenger coaches and accompanying consumables, four new main line locomotives, two shunting locomotives, two rescue cranes and various lifting equipment.

via Chinese Vice President hands over new equipment to Tanzania-Zambia Railway Authority – Xinhua |


Chinese hospital ship Peace Ark arrives in the Philippines – Xinhua |

China\’s navy hospital ship Peace Ark arrived in typhoon-hit Philippines on Sunday night and is the first foreign vessel of its kind that has reached there, Chinese Foreign Ministry spokesman Qin Gang confirmed.

Peace Ark, the first 10,000-ton-class hospital ship in the world, with 300 beds and over 100 medical professionals on board, has been put into use in the Philippines, Qin told a daily news briefing on Monday.

Doctors onboard Peace Ark, together with an emergency medical team sent by the Chinese government and an international rescue team dispatched by the Red Cross Society of China have treated hundreds of patients, the spokesman said.

Chinese medical workers will work closely with their Philippine and international counterparts during the rescue process, Qin said.

Qin also announced that the Red Cross Society of China has delivered a new batch of relief supplies worth 5.4 million yuan, including 2,000 tents and drugs, to the Philippine National Red Cross.

Typhoon Haiyan has killed 5,235 people and injured 23,501 others,the Philippine government said. Another 1,613 people remain missing.

via Chinese hospital ship Peace Ark arrives in the Philippines – Xinhua |


After Stingy Aid to Typhoon Haiyan Victims, China Tries Damage Control – Businessweek

With a relief team finally on its way to the Philippines, China is trying to control the damage from its petty response to the Typhoon Haiyan tragedy.

A 17-member disaster relief team from the China Red Cross prepares to depart for the Philippines, in Beijing, on Nov. 20

The Chinese group is getting there late because of political differences between the two governments. The storm may have killed thousands of people and brought to a halt a large swath of China’s neighbor to the south, but since the world’s new economic giant is feuding with the Philippines about disputed islands in the South China Sea, the leadership in Beijing decided to take advantage of a humanitarian catastrophe to teach President Benigno Aquino who’s boss.

China initially offered a paltry $100,000 in aid and, after an international outcry, raised that figure to $1.6 million. It’s as if Dr. Evil decided to go into the disaster-relief business: “One point six million dollars!” Hence the headlines worldwide expressing outrage that China, the world’s second-largest economy, was offering less money than do-it-yourself furniture maker Ikea.

Not the ideal message for a country trying to persuade its neighbors of its trustworthiness. China’s ham-fisted response to Haiyan is a welcome gift for Japanese Premier Shinzo Abe, who has spent much of his first year in office touring countries in the region that have good reason to worry about China’s intentions.

That’s probably why China’s officials and media are trying to change the narrative. Chinese relief workers are on their way to the Philippines now, China’s Foreign Ministry announced today—a week and a half after Haiyan hit. But not to worry, some Chinese blankets and tents started arriving on Monday and Tuesday. “China will also send a medical boat Peace Ark, which belongs to the Chinese navy, to the Philippines,” the Xinhua news agency reported today. “The boat, which has good medical rescue capability and maneuverability, will depart soon.”

Even as the Chinese relief effort finally gets underway, there’s a new message: China is actually the victim here, hurt by Philippine bureaucrats. According to Xinhua, China was slow because the Philippine government hadn’t given its blessing. Indeed, the state-run news agency reported yesterday the emergency medical team was “ready to go” and would “depart for the disaster areas immediately, once China gets permission from the Philippines.”

via After Stingy Aid to Typhoon Haiyan Victims, China Tries Damage Control – Businessweek.


* China Signals Interest in Afghanistan

NY Times: “In a sign of China’s growing interest in neighboring Afghanistan after the departure of the United States and NATO led forces, President Hu Jintao met the Afghan leader, Hamid Karzai, in the Great Hall of the People on Friday and announced a new strategic partnership between the two countries.

Mr. Karzai was given special attention this week at the summit meeting of the Shanghai

English: Afghan President Hamid Karzai at a su...

Cooperation Organization, a group of six countries organized by China that includes Russia and Central Asian nations bordering Afghanistan. China is trying to ensure that a Muslim separatist group in a western region does not benefit from the Taliban when Western forces leave Afghanistan.

In a joint statement, China and Afghanistan said they would step up cooperation in security and the fight against terrorism, as well as increase intelligence sharing. No specifics were given.

A modest $23 million aid grant for unspecified projects that accompanied the new partnership indicated that despite concerns about the stability of Afghanistan after 2014, when most United States and allied troops are expected to be gone, China had no immediate plans to play a major development role.

This was Mr. Karzai’s fifth, and most prominent, visit to China. No Chinese leader has been to Afghanistan since the 1958 visit of Prime Minister Zhou Enlai. China’s major worry is the prospect of a Taliban-dominated Afghanistan lending sanctuary to the separatist group, the East Turkestan Islamic Movement, led by ethnic Uighurs, a Turkic-speaking, largely Muslim people in the autonomous western region of Xinjiang. The group wants a breakaway homeland in Xinjiang.

via China Signals Interest in Afghanistan –

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