China's Aid Policies in Africa: Opportunities and Challenges

Since the Beijing Summit of the Forum on China–Africa Co-operation in 2006, China's renewed interest in Africa has garnered a lot of attention and generated a lot of debate. Western media and analysts have, perhaps not surprisingly, been generally very critical of China's rising influence in Africa. The African reaction, however, has been more mixed. African leaders have welcomed what they see as a new approach to development and increased potential for meaningful South–South co-operation. African civil society groups have been more cautious and are worried about the possible negative repercussions on governance, the environment, human rights and overall economic development. This paper focuses on Chinese foreign aid to Africa and discusses the opportunities and challenges that it presents for China, the African continent, and the international community. This allows the uncovering of many misconceptions regarding the potential impact (whether positive or negative) of this renewed interest by different parties. The paper argues that if one adopts an approach that puts ordinary Africans first, at the centre of development, then the only option available to us is to engage China in a constructive partnership in order to make its aid effective. Key Words: ChinaAfricaforeign aideffectiveness of aidBeijing consensusForum on China–Africa Co-operationofficial development assistanceParis Declaration on Aid EffectivenessSino-African relationsDevelopment Assistance Committee Acknowledgements The author wishes to thank Rosalie Vezina and an anonymous referee of this journal for their helpful comments and suggestions. Notes 1. The fact that Africa (and especially sub-Saharan Africa) will not achieve the MDGs tends to send a more pessimistic message than what is happening in African countries. For example, the benchmark year for assessing progress on the MDGs is 1990 (when Africa was not doing too well), and meeting the different goals would require Africa to improve at rates that have historically not been observed in Africa or anywhere else. One could also question the choice of indicators and difficulties in measuring progress. 2. The FOCAC was established by China and African countries in 2000 to foster South–South co-operation. Prior to the meeting in Beijing in 2006, two other meetings took place, in Beijing (2000) and Ethiopia (2003). 3. This expectation seems to have been met already. The China Daily (19 January 2009) reported that the China–Africa trade volume had reached an all time high of $106.8bn in 2008. 4. Interestingly, there was no mention of what the 2006 level was. 5. See www.focac.org/eng/ 6. The Accra Agenda for Action was endorsed by Ministers of developed and donor countries, and the heads of bilateral and multilateral agencies at the Third High-Level Forum on Aid Effectiveness held in Accra, Ghana, in September 2008. It demonstrates the international community's continued commitment to make development aid more effective. 7. According to the Foreign Commonwealth Office (www.fco.gov.uk), only four African countries now have diplomatic relations with Taiwan and they are Burkina Faso, Gambia, Sao Tome and Principe and Swaziland. 8. This lack of information applies not only to aggregate aid flows, but also to regional or sectoral allocations of aid by China. 9. The DAC defines aid as concessional flows (with a grant element of at least 25%) from the official sector whose main objective is the promotion of economic development and welfare. 10. It is also possible that the Chinese prefer to grant loans and then use debt forgiveness as a way to extract concessions from recipient countries. 11. Please refer to www.infrastructureafrica.org for more information about the state of infrastructure in Africa. 12. Such an argument presupposes that conditionality works, but the evidence is far from conclusive (Collier, Citation1997). 13. There is no evidence that the Chinese are concerned about heavy borrowing by African countries. However, debt relief is part of their assistance envelope to Africa, both in theory and in practice. 14. These principles are clearly defined in OECD (Citation2005). Ownership implies that recipient countries will exercise leadership in crafting their own development policies; alignment means that donor countries will provide assistance based on recipient countries' development strategies; harmonisation implies that donor countries will co-ordinate their actions, simplify their procedures and reduce duplication; managing for results means that donors and recipients will manage resources and use information to improve decision-making; finally, mutual accountability means that donors and recipients are accountable for development results. 15. The EITI is a coalition of governments, companies, civil society groups, investors and international organisations whose objective is to improve transparency and accountability in the extractives sector. It requires governments and companies to disclose what they receive or pay in order to ensure that natural resources can benefit everyone through growth and poverty reduction. For more information, please refer to www.eitransparency.org