Navigating the growth-and-sustainability dilemma of recipient countries in China-sponsored projects
the example of "no pain no gain"
In Shakespeare’s timeless play Hamlet, the character Hamlet declares, “There is nothing either good or bad, but thinking makes it so.”[1] This quote resonates with the ongoing debate surrounding China’s increasing provision of development finance in recent decades. Some China-sponsored projects are economically successful while others are not due to the differences of host countries’ goals and political system when selecting, managing, and executing those projects. This post argues that regardless of whether China’s non-interference principles and management system foster short-term economic growth in recipient countries, they frequently pose significant challenges such as environment damage, inequality, and exploitation, which potentially hinders long-term sustainable development in developing countries.
In this post, I will examine both successful and failing China-sponsored projects of infrastructure and industry in Africa from 1960s to the present, then analyze their mixed impacts on host country’s development to evaluate whether recipient countries truly benefit from Chinese-sponsored projects and to what extent.
On the one hand, China’s principle of “non-interference in internal affairs”[2] often leave host countries agency to select, manage, and execute infrastructure projects, bringing economic success to countries with consistent goals and effective government system.
For example, Tanzania’s TAZARA railway, “key pillar of the country’s five-year national development plan” (FYNP) was one of China’s most successful projects as it “formed the backbone of a new spatial orientation for agrarian production and rural commerce” in Tanzania, leaving “positive impacts on economic development patterns” with “ an annual economic growth rate of 7 percent. [3][4] This success comes from China’s management system which rapidly approved the project and financed “US$415 million” without interfering with Tanzania’s politics as the Western donors, and China’s ability to “finish the project ahead of schedule,” which helped Tanzania authorities achieve their FYDP timely.[5]
Additionally, Tanzania sustained its economic growth via an effective government that prevented corruption via the readiness to conduct investigations and willing to sentence corrupted leaders, preventing “white elephant projects” and potential of a debt-trap.[6][7] This example shows that China-sponsored projects bring economic benefits to the host country, especially when its timely deep-pocketed investment is a better deal compared to the West.[8][9][10] However, this project still posed a “high risk of deforestation in Tanzania” and “encountered a number of operational, maintenance, and sustainability problems” over time, raising concerns about environment damages and questioning TAZARA’s economic performance in the long run.[11]
On the other hand, firstly, host countries’ agency in engaging with Beijing’s offers does not always result in economic success due to the risk of debt-traps, and even worsen inequality in politically corrupted states with weak management ability.
While Chinese state actor “determines the strategic rhetoric and mobilization” of the projects, China’s “fragmented state structure” allows the implementation of China-sponsored projects “falls in the hands of bureaucracies, local governments, and state companies.”[12] This reason and corruption could lead host countries to economic failure. For example, during nine-year rule of President Mahinda Rajapaksa, many white-elephant projects were selected and implemented for his personal political purposes.[13] Mattala Rajapaksa International Airport (MRIA), one of the most expensive projects, was executed in Rajapaksa’s hometown for his political aims rather than the district’s benefits, then becoming “the world’s emptiest” airport.[14]
Without considering Hambantota’s actual needs, Sri Lanka “failed to generate revenue that would enable loan payment” to China and got in “US$8 billion of debt,” making it challenging to escape.[15][16] Additionally, weak corrupted government often chose to locate China-sponsored projects “disproportionately” in their hometown, further deepening the economic inequality between different provinces.[17] Moreover, a research found that “infant mortality actually increases with levels of local exposure to Chinese development projects,” referring to the uneven distribution of economic development in African countries.[18] In the long term, this tendency will prevent host countries from developing sustainably and proportionally.
Secondly, despite the potential of economic growth in the short run, China-sponsored projects also posed issues of natural resources exploitation and host country’s economic ability in the long run.
For example, Angola leaders accepted the Chinese-sponsored railway deals despite the expensive loans coming with them, risking Angola’s debt sustainability and oil resources as the deals were structured as “oil-backed.”[19] Dependency theorists would argue that these deals would mostly benefit the Angolan elite leaders while increasing payment responsibility for Angolan future citizens, deepening the inequality in Angola and putting Angola into a future debt-trap when this country runs out of oil.[20][21]
In conclusion, whether China-sponsored projects are beneficial to host countries is a complex question that relates to not only China state actors and host country governments, but also Chinese private actors and the citizens of recipient states. Those projects could bring economic growth in the short run but also issues of environment, inequality, and debt-traps. As a Vietnamese, awareness of this complexity and how positionality can influence our understanding about China-sponsored projects are crucial in keeping sustainability development for future generations.
Bibliography
Brautigam, Deborah. 2011. The Dragon's Gift: The Real Story of China in Africa. Reprint edition. Oxford: Oxford University Press.
Chellaney, Brahma. 2017. "China’s Debt-Trap Diplomacy." Project Syndicate. Project Syndicate, January 23. https://www.project-syndicate.org/commentary/china-one-belt-one-road-loans-debt-by-brahma-chellaney-2017-01.
Dreher, Axel. 2022. Banking on Beijing: The Aims and Impacts of China’s Overseas Development Program. Cambridge: Cambridge University Press .
Monson, Jamie. 2009. Africa's Freedom Railway: How a Chinese Development Project Changed Lives and Livelihoods in Tanzania. Indiana University Press.
Shakespeare, William. 2019. Hamlet. Revised Edition 2019. Edited by Neil Taylor Ann Thompson. London: Bloomsbury.
Taylor, Ian and Tim Zajontz. 2020. "In a fix: Africa’s place in the Belt and Road Initiative and the reproduction of dependency." South African Journal of International Affairs 277-295.
Wang, Yuan. 2023. "Big brother and small boy: African executive extraversion under Sino-African power asymmetry." In The Railpolitik, by Yuan Wang, 171-198. Oxford: Oxford University Press.
—. n.d. "China and Developing Countries: Part 1. "Theory II. Host country agency"."
—. n.d. "China and Developing Countries: Part 2. "Contemporary controversies I. Debt trap diplomacy"."
Ye, Min. 2021. "FRAGMENTED MOTIVES AND POLICIES: THE BELT AND ROAD INITIATIVE IN CHINA." Journal of East Asian Studies (Cambridge University Press) 193-217. doi:https://doi.org/10.1017/jea.2021.15.
[1] Shakespeare, William. 2019. Hamlet. Revised Edition 2019. Edited by Neil Taylor Ann Thompson. London: Bloomsbury.
[2] Brautigam, Deborah. 2011. The Dragon's Gift: The Real Story of China in Africa. Reprint edition. Oxford: Oxford University Press: 22 – 41.
[3] Dreher, Axel. 2022. Banking on Beijing: The Aims and Impacts of China’s Overseas Development Program. Cambridge: Cambridge University Press: 15 - 24
[4] Monson, Jamie. 2009. Africa's Freedom Railway: How a Chinese Development Project Changed Lives and Livelihoods in Tanzania. Indiana University Press.
[5] Dreher, “Banking,” 15 – 19.
[6] Wang, Yuan. n.d. "China and Developing Countries: Part 2. "Contemporary controversies I. Debt trap diplomacy"." 00:51 – 14:08.
[7] Dreher, “Banking,” 15 – 24.
[8] Dreher, “Banking,” 15 – 24.
[9] Brautigam, “The,” 22 – 42.
[10] Wang, Yuan. n.d. "China and Developing Countries: Part 2. "Contemporary controversies I. Debt trap diplomacy"." 02:00 – 09:54.
[11] Dreher, “Banking,” 15 – 19.
[12] Ye, Min. 2021. "FRAGMENTED MOTIVES AND POLICIES: THE BELT AND ROAD INITIATIVE IN CHINA." Journal of East Asian Studies (Cambridge University Press) 193-217. doi:https://doi.org/10.1017/jea.2021.15.
[13] Dreher, “Banking,” 15 – 19.
[14] Chellaney, Brahma. 2017. "China’s Debt-Trap Diplomacy." Project Syndicate. Project Syndicate, January 23. https://www.project-syndicate.org/commentary/china-one-belt-one-road-loans-debt-by-brahma-chellaney-2017-01.
[15] Dreher, “Banking,” 15 – 19.
[16] Taylor, Ian and Tim Zajontz. 2020. "In a fix: Africa’s place in the Belt and Road Initiative and the reproduction of dependency." South African Journal of International Affairs: 277-295.
[17] Dreher, “Banking,” 122 – 159.
[18] Dreher, “Banking,” 192 – 246.
[19] Wang, Yuan. 2023. "Big brother and small boy: African executive extraversion under Sino-African power asymmetry." In The Railpolitik, by Yuan Wang, 171-198. Oxford: Oxford University Press.
[20] Wang, “Big,” 171 - 198.
[21] Wang, Yuan. n.d. "China and Developing Countries: Part 1. "Theory II. Host country agency"." 03:55 – 17:08
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