Could China replace the US as a global aid giver?
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One of the first things that Donald Trump did as US president was to freeze foreign aid. USAID is the agency that has pumped billions into global projects from disaster relief to fighting malaria. And we've talked about it on another episode of What in the World. When Donald Trump made that announcement, this activist went viral on TikTok. We have

We have depended on USAID for over 60 years and the moment the owners of the money say, let's take a 90 day pause that I audit where my money is going, suddenly the whole country goes into a frenzy. This should be a moment of reflection for Uganda and the African continent in general. We have been asking for a very long time to be liberated from colonialism, neocolonialism and now that the opportunity presents itself, for some reason we are complaining.

You're going to hear a bit more from her later in the episode because today we're talking about who might now step in to replace USAID. Could it be China? Well, China has already upped its foreign spending in places like Africa. It's investing in huge infrastructure projects like the Belt and Road Initiative that plans to build new trade routes to connect Asia with Africa and Europe.

But will this plug the gap? Or is it more about soft power, a way for China to exert its influence around the world? That is what we're going to be exploring on this episode of What in the World from the BBC World Service. I'm Hannah Gelbart.

Let's find out more about this now from Sean Wan, who is from the BBC's Global China Unit. Hi. Hello. Welcome back to the podcast. Thank you so much for having me back. So before we get into why China might step up its aid donations, I want to find out a bit more about the basics. How much international aid does China currently give? Well, I think for most countries or donors, it should be the easiest question to answer. But China is actually quite elusive when it comes to aid spending.

What we have so far is a combination of news reports, bank reports, contracts being signed, etc. And even the latest figure we have is up until 2021. But it does give us a good sense of China's spending. So over the two decades leading up to 2021, China spent over 1.34 trillion US dollars on international aid and development. And that is a huge number, even bigger than the US is spending in roughly the same period, which stands around 1.24 trillion dollars. Yeah.

Since the dismantling of USAID, many people are wondering who is going to do it instead. I mean, given that China is already spending so much on international aid, will it fill the gap? Hannah, that is an important question that many are asking, right? Well, in short, I would say the answer is no, at least not in the same way that many people are expecting. Definitely not on the dollar for dollar basis.

So before we talk into specifics, I think it's important to kind of step out a little bit to say comparing USAID to China aid is like comparing, say, apples to rice. They both offer nutrients, in this case money, but they're also fundamentally different. We already talked about China spending so much money overseas. So it's incredibly important to spell out the differences between USAID and China aid in order to answer the question of whether China will fill the gap or not.

So let's talk about the specifics, especially when it comes to what kind of projects China is going to fund. We have seen a lot of reports on USAID suspension's impact on, say, sub-Saharan African countries' ability to fight HIV or Iraq's ability to keep terrorism threat at bay.

All those things speak to the USA's priority, such as health, security, governance, etc. But those are not the places where China aid is going. What we're talking about is those big infrastructure projects. For example, in Peru, where Beijing financed the megaport that just went into operation last year, in Tanzania, China also financed major railways.

And also in Pakistan, for example, this country received some of the biggest development aid from China in support of the China-Pakistan Economic Corridor that includes major seaports, airports, railways, Russia as well, also on the scale of big infrastructure projects.

infrastructure development. So those are the places where China aid is going. And to circle back to your question, judging from the sector where China aid is actually funding, China might not be able to fill in the gap left by the suspension of the USAID. What I'm hearing from you is that the US focused on

humanitarian projects in humanitarian relief, whereas China is more about infrastructure and these like big scale projects. Absolutely. Does China invest anything in humanitarian aid? Oh, absolutely. China is still quite involved in humanitarian aid as well. For example, we're talking about

Say, after an earthquake struck Morocco, China did send some humanitarian aid. After the war broke out in Gaza, China also sent humanitarian aid as well. So all that's to say that China does get involved in that sector. It's just not on the same scale as USAID. China must be getting something out of this. What are they getting?

China's getting a few things back out of this. First of all, the soft power war going on between China and the US is still brewing. And the US has garnered a lot of support from international communities by giving out grants to humanitarian sectors globally. And China has seen that kind of opportunity as well. So even though China is not necessarily spending so much money on humanitarian aid, it is still spending a lot of money on international development.

And that has again come back to serve China's long-term goal of expanding its soft power and making it look like the leader of the global south. But also at the same time, a lot of the contracts, for example, signed under Belt and Road Initiative

were awarded to Chinese contractors. And they are the people who go to those countries and hire locals or bring Chinese workers. And all this money, a lot of this money, would eventually come back to China. So that's also what China is looking for as well. And last but not least, I think one of the main reasons why Beijing wants to do this is to sort of stimulate local economic development.

growth by planning all those infrastructure projects and basically asking the host countries to develop economies themselves and then gradually getting closer to China and maybe eventually competing with China in a way. So does that mean that people domestically, people in China are supporting the idea of China spending so much on foreign aid?

It depends on when you asked. Back in the early 2010s, for example, when China's economy was going through its explosive economic growth, a lot of people were going out to Africa, were going out to Latin America to try to open their businesses. And from that point on, the way people saw China, the way people saw Chinese development in sub-Saharan Africa, for example, is reflective of

of how they see their future. They say that by exporting our money, by exporting our infrastructure projects, by supporting other countries, it's gonna come back to us. We are gonna be able to get better economic benefits down the road as well.

But nowadays, China itself is going through a rather challenging situation economically at home. A lot of people are struggling. And we have property crisis going on in China. And domestic spending has not come up yet either. So at this time, Beijing is going to be having a pretty hard time trying to justify the decision of trying to up its humanitarian aid or international aid assistance

two global partners in face of the fact that many people within China are actually struggling. What criticism has there been of Chinese aid policies? I think the biggest criticism we've seen so far is the lack of consideration for human rights record of the recipient countries.

USAID plays a lot of importance on the host countries or the recipient countries' human rights record. China, on the other hand, doesn't really care that much about it. For example, Russia, under the sanction of the Western government for invasion of Ukraine, is still receiving a lot of development aid from China. So I think that is the biggest point where it's drawing criticism. Sean, thank you so much for coming back on the podcast. Of course. Thank you.

Let's chat to Janice Nkajanao. She is a social justice activist and an international law student from Uganda. Hi Janice. Hello Hannah. Welcome to the podcast. So as we heard at the top of this episode you recently went viral on TikTok following the announcement by Donald Trump. If you don't want Africa and Uganda to rely on foreign aid whether that comes from the US or China is there another solution that you would like to see? Like where is Uganda going to get the money it needs from? I think

I think the biggest issue is the fact that we lack viable accountability systems within Uganda itself. I know in one of my videos I've been criticized a lot for painting African nations as corrupt and thieves. And the point was that because the amount of money we lose every day is baffling.

So we have all this money slipping out and we have so much debt that we gain from foreign aid or from partnerships from foreign countries. So the first step, honestly, that I want us to as a nation to elaborate is to have accountability for our money. If we can properly use the money we already have, it becomes easier to make more money. I think the other thing that Uganda should incentivize, for example, public-private partnerships essentially.

because there are so many projects that cannot lie on government, but the private sector within the country is willing to provide those services. It's just that in most cases, the government would rather give those partnerships to Western companies than to give those partnerships to local companies. That's not only reducing employment opportunities for people living within the country, but it's just creating a whole issue of

having to deal with so many external factors that we do not need. I think a key thing that East African countries are currently doing, or African countries, is the African Continental Free Trade Area. This helps us to reduce reliance on external donors because there's an intrastate trade system that reduces not only how much money we need to spend on importation, but also creating a sense of communion within African nations and the African continent. And I think lastly,

Africa nations should actually start investing in innovation. That's the biggest thing that young people like me are arguing about when it comes to sustainability, because they do not spend as much on innovation. Yet we have so many brilliant minds in tech, in innovation, entrepreneurship. But young people are not given these spaces or these platforms yet.

That's why we have a huge problem of brain drain in Africa and in Uganda, because young people are leaving because the government does not see their worth. Or each time young people come up to speak about these issues, it's a sort of threat to them. And so it becomes a whole big issue.

Daniel Dadsi is a BBC reporter in Ghana, and he sent us this about China's funding strategy in Africa. At the 2015 Forum on China-Africa Cooperation, which is called FOCAC, President Xi Jinping pledged a huge $60 billion financial support to Africa, and it was supposed to touch various forms of assistance, investment, loans, what have you. In the most recent FOCAC,

The theme was small is beautiful, where China is now focusing on smaller revenue generating projects that are less risky for both China and its African partners. Now, there are two reasons for this. First of all, African governments are finding it more and more difficult to pay back their loans since COVID. It's been an age old problem that has been building, but COVID really made it worse. Also, there are experts who say that China is facing its own economic challenges even

In-country. And so it has to be more careful in how it dishes out money or puts out its investments. So it does not necessarily translate that China has the financial muscle or the economic muscle to switch to social services or include social services. And China has been blamed by some major countries like the U.S.,

for pushing or exacerbating Africa's debt problem. And so they are being more careful in lending or giving out as much money as they did in the past. So it may not be as straightforward to assume that China can simply include social services in their existing offering of support to Africa.

That brings us to the end of today's episode. If you have thoughts on this, we would love to hear your opinions. You can send us a DM on Instagram. We are at BBC What In The World or send us a voice note on WhatsApp. I'm Hannah Gelbart. This is What In The World from the BBC World Service. We'll see you next time.