Beyond the ‘debt-trap strategy’ narrative: China’s rise and the expansion of policy autonomy of the Global South

In asking whether China’s growing economic power and international economic engagement increases or reduces the highly constrained industrial policy space associated with the contemporary neoliberal mode of regulation of international economic relations, it is argued that Chinese finance enlarges the development policy space as it significantly helps fill infrastructure gaps, while focusing on big clusters of projects in the energy, transport and industry sectors. In addition, it provides finance free of the neoliberal conditionalities attached to Western-centred multilateral and private finance. Regarding trade and investment relations, Chinese agreements are shallow and grant national states the upper hand in relation to behind-border industrial policy measures in striking contrast to core countries’ neoliberal trade and investment agreements. Considerable emphasis is placed on the responsibility of the Global South to adopt measures enabling itself to seize the development opportunities derived from China’s internationalisation approach.