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Nov 12, 2017

Quietly, and largely out of sight, China has emerged to become a major player in the foreign aid space, challenging institutions and norms long established by the West. Although China's international development budgets remain a tightly guarded state secret, new data  indicates Beijing is spending a lot more money on aid programs than almost anyone had imagined.

AidData, a research lab at William & Mary in Virginia, conducted an analysis of 4,300 Chinese-funded projects in 140 countries from 2000 to 2014. During that time, AidData believes the Chinese spent somewhere around $350 billion on development programs. Unlike the United States, which spent $394 billion during that same period, the Chinese do not spend aid money in traditional development programs (i.e. cash grants to institutions). Instead, the Chinese have focused their efforts on infrastructure development, export credits and loans.

The Chinese approach to international development challenges a half-century of Western dominance where aid to developing countries almost always came with conditions. Whereas U.S. and European countries require aid recipients to undertake political and economic reforms to qualify for assistance, the Chinese have a "no strings attached" policy. Furthermore, the Chinese don't seem eager to deepen their engagement in the clubby aid world of the IMF, World Bank and other international NGOs, preferring instead to deal bilaterally with governments or to create their own development bodies like the Asian Infrastructure Development Bank.

On a more fundamental level, the Chinese are taking away a deeply-embedded narrative within the Western psyche that the U.S./European development model is superior in both economic and moral terms. Many of the perceptions in the West about aid have been framed as white people 'saving poor brown people' in Africa, the Americas and in Asia. Now that there is a legitimate alternative from a non-Western country that happens to be the world's second largest economy, that morality narrative will no doubt face more scrutiny in the years ahead.

In this edition of the China in Africa Podcast, AidData Executive Director Brad Parks joins Eric & Cobus to discuss his team's latest findings on Chinese foreign aid and how Beijing's money is being spent in places like Africa.

Join the discussion? Do you think it's healthy that there is an alternative to the Western-led aid system or is China's lack of transparency and preference in dealing with African elites more concerning? Let us know.

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