Tuesday, 22 July 2014

Development at home and abroad: Chinese challenges

China is rapidly becoming not just the biggest engine of economic growth in the world and the biggest market, but also the largest contributor of development aid. China’s extraordinary wave of rapid growth and poverty reduction at home over the last few decades is now being matched by assertive influence in south-south cooperation, development finance, trade, and social and economic policies around the world. The interrelationships between China as a development actor domestically and abroad, and the embeddedness of both in Chinese history, culture and discourses, are the subject of a new IDS Bulletin published this week: China and International Development: Challenges and Opportunities’?

Domestic growth – and its downsides

China’s own rapid growth has involved a unique combination of targeted state investment and business finance and action. In some respects the strong role played by central government and institutions such as the China Development Bank make China a key example of an ‘entrepreneurial state’, in the terms proposed by my SPRU colleague Mariana Mazzucato. Chinese experiences will be amongst those discussed at a high-profile conference in London this week, exploring how success in smart, innovation-led growth has more often than we realise needed long-term, visionary ‘mission-oriented’ public policy and investment to enable, kick-start and nurture private sector activity.

As China’s economic growth has proceeded apace, its downsides have also become more apparent. These include sharp and rising inequalities between regions and social groups, and severe environmental challenges – from disasters and degraded landscapes to polluted water sources and devastating urban air quality problems. Chinese scientists and stakeholders recently debated these challenges – and plans for a new generation of integrated, co-designed knowledge and policy efforts to build sustainable development pathways – at a Future Earth symposium. Everyday sustainability problems were all too evident during my visit to Beijing in June for Future Earth and other meetings. At a talk hosted by the China International Development Research Network, chaired by one of the Bulletin’s co-editors, Li Xiaoyun, I discussed the challenges of linking sustainability with social justice, drawing on the pathways approach of the STEPS Centre. Discussions here and with Chinese colleagues in Tsinghua University, Beijing Normal University and the Chinese Academy of Social Sciences all revealed urgent needs and high enthusiasm for new approaches that link the technical and the social to seek sustainable development in areas like low-carbon energy and urban waste management.

How far Chinese ‘mission-oriented’ finance for innovation will embrace these challenges remains to be seen, but there are encouraging signs. Some argue that China has always been a ‘developmental state’, investing concertedly in its least-developed Northern and Western provinces since the 1980s. Meanwhile the China Development Bank is expanding from its traditional focus on infrastructure, communications, transportation and basic industries – many of them highly polluting – to support green investments in areas like solar energy, low-carbon cities, watershed protection and waste recycling.

China going global

How are China’s own experiences influencing the country’s growing role as an international development actor? The Bulletin explores this issue at a timely moment: the week after China published its new white paper on foreign aid, and during the week of the 6th BRICS Summit in Brazil. China is a heavyweight player in BRICS discussions and its growing domestic focus on green investment is arguably reflected in the BRICS Summit declaration issued earlier this week. This  includes a clear commitment to clean energy  and sustainable development.

Importantly, the Summit is firming up plans for the BRICS Development Bank first mooted in 2013. As Adriana Erthal Abdenur argues in the Bulletin, China’s participation will not represent a significant addition to its already vast international development cooperation and lending programme. But it will enhance China’s legitimacy and leverage in shaping international development policies, multilateralism and assistance approaches on a global stage.

Chinese international development modalities have developed historically and socio-culturally, in ways that contrast with the models of traditional Development assistance Committee (DAC) donors. The emphasis is on least developed countries, on south-south cooperation and mutual interests in aid-business-trade, and on respect for national sovereignty and local ownership. With most projects focusing on large scale infrastructure or agricultural investments, in as much as poverty reduction is a focus it is assumed to trickle down from these. Chinese development discourses generally emphasise the technical, and non-interference in messier social and political matters.

How far can this discourse of non-interference be held up in practice? 

As the long history of aid and development tell us, projects and assistance that claim to be ‘only technical’ always and inevitably carry social assumptions and politics with them, even if implicitly.

How will recipient countries experience and co-ordinate an expanding range of inputs and impacts from Chinese and other aid donors who do things differently? And how will China interact, discursively and practically, with other countries and agencies who seek to tackle poverty, vulnerability and sustainability in more overtly social and political ways?

These are key challenges for a very near future, set to ramp up a level as China extends its presence not just on the ground in developing countries but in interaction with other rising powers in BRICS finance and policy platforms.


  1. From your point of view, what are the advantages and disadvantages of chinese cooperation in Africa? Multilateral institutions can lose some weight in the flow of finance for developing Countries in China's favor?

  2. Thoroughly I really like your post on China development. I think China’s extraordinary wave of rapid growth and poverty reduction at home over the last few decades is now being matched by assertive influence in south-south cooperation, Development Finance, trade, and social and economic policies around the world.


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