Social Impacts of China's Approach to Development

Abstract

China has emerged as a significant global donor. Whilst there is much debate as to what constitutes Chinese foreign aid, expenditure of the Chinese government on aid grew significantly from the turn of the century linked to events such as the launch of the Forum on China-Africa Cooperation (FOCAC) in 2000 and the initiation of the China-Africa Development Fund in 2006.As China increases its role in international development cooperation, its practices in foreign aid attract more attention and, at times, criticism. Critics have, for example, highlighted issues of corruption, impediments to democratic development, lack of transparency and accountability, and the absence of conditionality other than the ‘One China’ principle and aid being tied largely to Chinese contractors.This rapid literature review collates available evidence on social impacts of China's approach to development. It draws on a diverse range of sources from multiple academic disciplines (both quantitative and qualitative) and grey literature. The review acknowledges that social impacts of development assistance are multidimensional and multifaceted and will manifest differently across sectors and countries making conclusions hard to reach. The review draws heavily on the work of Martorano et al. (2018; 2019) and Iacoella et al. (2021) etc., who combine data on Chinese development projects with data from Demographic and Health Surveys to study the impact of Chinese aid on household welfare and political participation.A nascent body of research has emerged associated with the release of AidData’s Global Chinese Official Finance Dataset (published in 2017). Studies have found positive, negative, or even no impact of Beijing’s aid on recipient countries. To date, the literature has investigated the effect of China’s foreign assistance on a broad range of outcomes in recipient countries, including economic and social development, governance, conflict, and deforestation. Understanding the social impacts of China’s approach to development is thus complex linked to the form and financing mechanisms of development aid. It is also suggested that China’s approach to aid has evolved, influenced by both domestic factors (i.e. the nature of the Chinese economy) and international factors (i.e. influenced by debates around the Sustainable Development Goals (SDG’s) and a desire to exert a leadership role on the international stage).