Giles Mohan
(The Open University)
Indrajit Roy
(University of York)
Format:
Panel
Streams:
Politics and political economy
Sessions:
Friday 8 July, -
Time zone: Europe/London
The rise of China and the re-scaling global development politics.
Panel P03a at conference DSA2022: Just sustainable futures in an urbanising and mobile world.
Discourses around a 'new cold war' conclude that the liberal international order is threatened by China. Yet, new mobilities of capital, people, and knowledge re-orient the who, what, where and how of global development politics which this panel addresses through empirically-based theorisation.
Long Abstract:
Putative discourses around a 'new cold war' posit a politics of scale that is based on extant imaginaries of super-power rivalry and 'spheres of influence', and which ultimately conclude that the liberal international order is under threat from China and other erstwhile developing countries. Yet, if we consider new mobilities of capital, people, and knowledge then the reality on the ground suggests a more complex, multi-scalar politics of development. These emerging dynamics force us to radically re-orient the who, what, where and how of global development, which break away from crude 'North-South' geographies to focus on interconnected scales. But development studies' rootedness in political-economy means we retain a critical focus on who benefits and who loses from these emergent processes so that questions of exclusion and peripheralization, and their opposites, are central.
This paper-based panel seeks to assemble empirically-informed theorisations of global development politics in the current conjuncture and to chart emergent trajectories. We are particularly interested in hearing from early career scholars and PhD students, as well as scholars based outside Western Europe and North America. Participants will ideally deliver a video with slides three weeks before the session and the discussant will open the session with a provocation before opening up for discussion. The session would be edited into a video podcast co-hosted by the Open University and University of York.
This paper comments on the empirical impacts the rise of Chinese aid is having on the allocation of traditional donors' aid globally. This attests to how China is forcing a reorientation and refocussing of global aid efforts and how the rise of Chinese aid should be considered explicitly in aid.
Paper long abstract:
The rise in Chinese Official Development Assistance (ODA) in the last twenty years has rattled the traditional donors of the international development community leading to inappropriately targeted support, a lack of donor coordination, and likely poor ODA effectiveness. Though calls for donor coordination and tripartite cooperation grow louder, they continue to be ignored. A dearth of research considering the interdependence of donors' ODA allocations evades development theory and any hope for future donor coordination and tripartite cooperation. Accordingly, this paper asks whether traditional-Chinese donor competition between 2000-2017 in 144 recipient countries is significant in determining traditional donor ODA and whether this competition, if it exists, is stronger in sectors where Chinese ODA is most prevalent. This paper timely presents a global, empirical, and sectoral study investigating competition between China and traditional donors in the extension of ODA. The results highlight statistically significant elasticities of traditional donor ODA with respect to that of China at the 1% level; only projects in the infrastructure and social sectors retained significance, closely mapping the sectors where Chinese ODA is most notably observed. As such, this paper concludes that donor competition is pertinent, impactful, and highly nuanced. In so doing, this paper helps policymakers reflect upon the motives and distribution of their ODA allocations, and ensure future efforts to improve ODA effectiveness by first focusing attention on donor cooperation and addressing recipient need in ODA allocation.
The sovereign debt crisis is at an impasse, with multilateral backstops failing. US reassertion of hegemony has brought stability, while eroding the global financial order. A complex patchwork of multi-scalar competition and collaboration is more likely to emerge than rival US and Chinese blocs.
Paper long abstract:
Covid-19 has produced a severe global economic shock. One result has been a sovereign debt crisis encompassing dozens of predominantly low- and middle-income states. Key multilateral crisis governance mechanisms- the International Monetary Fund as lender of last resort and the Paris Club as a forum for debt restructuring- have failed to adequately perform their expected backstop functions within the global financial order. One important cause has been the rise of a parallel system of Chinese development finance, only weakly connected to the incumbent US-centred regime and incompatible with many of its modalities. Concurrently, a global liquidity glut has seen a much wider range of states borrow from capital markets at commercial rates, greatly complicating restructuring processes. In response, the US has reasserted a hegemonic role through liquidity provision, relying on national institutions such as the Federal Reserve rather than multilaterals such as the IMF to bring temporary stability. I argue that these shifts represent a fraying of US-centred universalist institutions of the global economic order (a trend already observed at the WTO). US-Chinese geoeconomic competition increasingly extends to development finance in individual countries, presenting new opportunities and pitfalls for national-level actors, which I explore via examples from Sri Lanka and Ecuador. However, rather than a divergence into separate US- and China-centred financial blocs, a more likely medium term scenario may see the emergence of a patchwork of regional polarities and ad hoc configurations of private and state actors, an environment somewhat reminiscent of the turn of the 20th century.
This paper specifies top Chinese political leaders, minister-level state agencies, provincial governments, policy and commercial banks, non-financial SOEs, and private companies' respective participation in bilateral and multilateral development finance cooperation.
Paper long abstract:
Why does China engage in multilateral development finance institutions (MDFIs) despite the effectiveness and convenience in reaching national objectives through bilateral lending? The existing literatures of international development finance distinguish China's bilateral development lending, sourced from its various domestic financial institutions to the developing world, from its participation in MDFIs such as the World Bank and ADB. The former is regarded as the Chinese state's self-serving outward expansion that challenges the liberal international order. Whereas the latter is considered as Beijing's subjection to the Bretton Woods system and that it is being socialised into the liberal economic norms. The dichotomy between describing China as a 'revisionist' power and 'status quo' supporter does not help us understand its strategic engagement in bilateral and multilateral development finance mechanisms simultaneously.
This paper details key domestic Chinese actors' institutional choices in international development. Further, the paper specifies top political leaders, minister-level state agencies, provincial governments, policy and commercial banks, non-financial SOEs, and private companies' respective participation in both bilateral and multilateral development finance cooperation, the challenges they face in bilateral lending, and how they pursue 'efficiency' and 'strategic' gains through engaging with the MDFIs. It argues that the domestic Chinese actors adopt a comprehensive participating approach to international development finance. They do not choose between either bilateral or multilateral approach to overseas development activities. Instead, they engage in both, the extent to which depending on their respective political and commercial interests as well as their 'efficiency' and 'strategic' needs.
The paper explains China's decision in 2021 to stop financing coal projects abroad. Using data from elite interviews and official documents, we show how the new policy was jointly shaped by foreign governments, transnational non-governmental actors, and domestic policy entrepreneurs.
Paper long abstract:
Over the past fifteen years, China has surpassed the World Bank as the leading financier in the global energy sector. However, unlike western-led multilateral development banks, the majority of these Chinese energy investments were in fossil fuels, especially coal. For this reason, China's approach to govern overseas energy finance have been highly criticized due to its negative impacts on energy transition in the Global South. In September 2021, Chinese President Xi Jinping announced that China will stop supporting new coal-fired electricity projects abroad. This pledge was made beyond expectations of many observers outside of China as it deviates from China's long-term approach of non-interference when providing development finance. What can explain this dramatic policy change made by Beijing? Drawing on the literature on multi-level governance and Chinese politics, we argue that in the context of rising geopolitical tensions between China and the West, the Chinese government become more receptive to the proposals of greening China's overseas engagement. More specifically, the 'no coal abroad' policy was driven by factors through three channels: pressure of Western governments, advocacy of transnational environmental organizations, and initiatives of domestic policy entrepreneurs. To substantiate our argument, we use government documents and elite interviews to show how these three types of forces interact with each other to lead Beijing to make the decision in September 2021. By unpacking the complex policy-making processes of China's overseas energy finance, the paper contributes to the burgeoning literature on China's global engagement and environmental governance of the Belt and Road Initiative.
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Indrajit Roy (University of York)
Short Abstract:
Discourses around a 'new cold war' conclude that the liberal international order is threatened by China. Yet, new mobilities of capital, people, and knowledge re-orient the who, what, where and how of global development politics which this panel addresses through empirically-based theorisation.
Long Abstract:
Putative discourses around a 'new cold war' posit a politics of scale that is based on extant imaginaries of super-power rivalry and 'spheres of influence', and which ultimately conclude that the liberal international order is under threat from China and other erstwhile developing countries. Yet, if we consider new mobilities of capital, people, and knowledge then the reality on the ground suggests a more complex, multi-scalar politics of development. These emerging dynamics force us to radically re-orient the who, what, where and how of global development, which break away from crude 'North-South' geographies to focus on interconnected scales. But development studies' rootedness in political-economy means we retain a critical focus on who benefits and who loses from these emergent processes so that questions of exclusion and peripheralization, and their opposites, are central.
This paper-based panel seeks to assemble empirically-informed theorisations of global development politics in the current conjuncture and to chart emergent trajectories. We are particularly interested in hearing from early career scholars and PhD students, as well as scholars based outside Western Europe and North America. Participants will ideally deliver a video with slides three weeks before the session and the discussant will open the session with a provocation before opening up for discussion. The session would be edited into a video podcast co-hosted by the Open University and University of York.
Accepted papers:
Session 1 Friday 8 July, 2022, -