Chinese Economics Thread

[delft]

Brookings has an interesting look at China's foreign aid reforms. I don't think it's proper to call China's development loans "aid," but the article is interesting nonetheless.

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Many of us will remember the hubbub in London when it came out a few years ago when it came out that UK had given to a hydro-power scheme in Malaysia in order to sell military aircraft to that country. In the Dutch press I read occasionally that Dutch aid is given more the interest of Shell or even Heineken than those of the receiving country.
So giving aid to improve the infrastructure of a country and the technical level of its inhabitants to make them more receptive to buying Chinese goods is pretty magnanimous.

 

[Blackstone]

So giving aid to improve the infrastructure of a country and the technical level of its inhabitants to make them more receptive to buying Chinese goods is pretty magnanimous.

That might be true, but Professor Debora Brautigam spent decades in Africa studying Sino-African relations and business conducts, and her conclusion is the West largely misunderstands Chinese involvement in Africa, and how China views the continent.

Chinese "aid" to Africa is actually small, with the vast majority of money spent being loans for specific projects like roads, rails, dams, power plants, and the like. The reason China is so deeply rooted in Africa is they treat African nations as economic partners and not hapless beggars, so money given are usually loans and not aid. Of course, Beijing does indeed lend "aid," but they are much smaller in comparison.

Here's a link to Professor Brautigam's very informative book on China in Africa that dispels a lot of myths about China as "neo-colonialists." It's a great read with lots of information backed by evidence, but it's not dry like run-of-the-mill academic papers, so it wouldn't cure insomnia.

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[delft]

That might be true, but Professor Debora Brautigam spent decades in Africa studying Sino-African relations and business conducts, and her conclusion is the West largely misunderstands Chinese involvement in Africa, and how China views the continent.

Chinese "aid" to Africa is actually small, with the vast majority of money spent being loans for specific projects like roads, rails, dams, power plants, and the like. The reason China is so deeply rooted in Africa is they treat African nations as economic partners and not hapless beggars, so money given are usually loans and not aid. Of course, Beijing does indeed lend "aid," but they are much smaller in comparison.

Here's a link to Professor Brautigam's very informative book on China in Africa that dispels a lot of myths about China as "neo-colonialists." It's a great read with lots of information backed by evidence, but it's not dry like run-of-the-mill academic papers, so it wouldn't cure insomnia.

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There are very many stories about aid in the shape of equipment, water pumps come to mind, that are provided without costs to the recipients and without arrangements for maintenance. When a few years later the equipment fails all effort has been in vain.
It makes more sense to provide equipment at a reasonable cost paid for by a loan at an interest rate which can be kept reasonably low because it is provided with technical training for its use and maintenance, especially if it is part of the developing infrastructure of the country as railways, roads, dams and power plants. The improved infrastructure will make the loans repayable and the whole will be of advantage to the recipients.
Other countries also provide a lot of "aid" in the form of loans and it was the fact that a lot of the aid was of no real help to many African countries that let to the financial crises in many of them some twenty years ago that the IMF tried to "solve" by a "restructuring" that included reductions in education and health services.

 

[kroko]

World Bank removes from its website a contentious chapter from a report made on china´s economy 2 days after its release.

News about the original report:

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After the chapter was removed:

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What do you make of this?

 

[Blitzo]

World Bank removes from its website a contentious chapter from a report made on china´s economy 2 days after its release.

News about the original report:

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After the chapter was removed:

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What do you make of this?

If china did "oppose" the part of the report (for whatever reason), I can't imagine the world bank would have removed it just willy-nilly. Like the articles say, it is a western dominated institution, and if it went through the proper review process then I can't imagine it would have been pulled simply on the basis of Chinese protests if such protests even occurred.

 

[kroko]

If china did "oppose" the part of the report (for whatever reason), I can't imagine the world bank would have removed it just willy-nilly. Like the articles say, it is a western dominated institution, and if it went through the proper review process then I can't imagine it would have been pulled simply on the basis of Chinese protests if such protests even occurred.

Well, we cant be naive. China is increasingly more influential in international institutions, it has the second largest economy in the world. And, of course china would have good reason to remove very damning information from the world bank report.

 

[AssassinsMace]

What I read from some articles when it first came out that the gist of it is nothing new that hasn't been criticized before. Let's not forget that a human rights group recently reported that the World Bank is guilty of the things Obama was worried about AIIB in regards to countries it may give loans to. Maybe the report was redacted because it would be hypocritical to point the finger? That story certainly didn't get much play in the media. Is that because of "outside" influence? Maybe the criticism here was meant to bury that story. It's always about distraction and deflection.

 

[Blitzo]

Well, we cant be naive. China is increasingly more influential in international institutions, it has the second largest economy in the world. And, of course china would have good reason to remove very damning information from the world bank report.

In either case the particular chapter was removed for a reason... regardless of China's influence, it is still somewhat limited in the western dominated world bank, and I can't help but believe that if the particular chapter went through the entire review process properly then they wouldn't have removed it so easily... or if the world bank had its own motivations for removing it.

.... OTOH, if the world bank really is willing to change the contents of its reports on a whim of influence, then it puts no small amount of doubt onto the validity of current and past reports on all global economies, and one can't help but wonder if the larger and more dominant economies of years past may have influenced the world bank (and/or other institutions) regarding reports on their own economies.

 

[Blackstone]

World Bank removes from its website a contentious chapter from a report made on china´s economy 2 days after its release.

News about the original report:

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After the chapter was removed:

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What do you make of this?

Humm, do you suppose Chinese intelligence services have pictures/vids/recordings of extreme wrong doings by leading World Bank officials and decided to make MICE of them...?

 

[JayBird]

Perhaps the damage is already done because the people already got the propaganda value they wanted out of the first article? It's like attorneys and prosecutors make some outrageous statements and then withdrawal the statements before even objection from the other side. The important thing is the jury( audience) already heard what you said the first time. And then you can even make a sad face and claim no one put pressure on you to gag the report.