Paper short abstract:

With it's vast scope and granularity on actors involved in China's overseas development finance program, AidData's Global Chinese Development Finance Dataset enables this deep dive into the role of Western private financing institutions in bolstering the effectiveness of Belt & Road Initiative.

Paper long abstract:

International financial networks supporting large infrastructure projects involve a plethora of visible and hidden actors working together as financiers, co-financiers, recipients, insurers, and implementers. Most policy analyses of China’s Belt and Road Initiative, however, focus exclusively on the senders or recipients of financial flows, without considering the crucial role of financial brokers bridging structural holes that are endemic to large financial networks. Using detailed information from AidData’s newly released Global Chinese Development Finance Dataset, apply structural holes analysis to identify key co-financiers enabling Chinese overseas development projects. We find that projects involving the top-20 intermediaries have 43% greater commitment values than average and are 19 times more likely to be financed through syndicated loans. Beijing engages these reliable intermediaries in riskier projects, likely as a risk mitigation tool, and increasingly through syndicated loans. With over 86 of projects involving top-5 intermediaries committed in the first five years of the BRI-era having a combined value of $11.5 billion, this is the first-ever systematic investigation into this underexplored aspect of Chinese development financing.

Paper short abstract:

This paper argues that the rise of global land governance initiatives is influencing private firm behaviour in ways that dilute the contrast between Chinese state capital and global private capital and shape future perspectives on foreign direct investment in land-based investment in Africa.

Paper long abstract:

The literature on Chinese investment in Africa differentiates between Chinese state capital and global private capital. Based on theories of varieties of capital, this literature sees the peculiarity of Chinese state capital in its pursuance of strategic, politically motivated, long-term interests in Africa, in contrast to short-cycled and profit-orientated forms of ‘Western’ private capital. This paper puts this contrast into question in light of the sharp rise of public and private global governance norms and (certification) instruments for responsible investments and the emphasis on ‘land tenure security’ in international agendas, which exerts substantial pressure on private investors. We argue that these global governance initiatives are shaping new trends in foreign direct investment in Africa, and have, in many instances, worked to influence firm-behaviour in ways that dilute the sharp contrast between Chinese state capital and global private capital. This article contributes to the literature by empirically exploring the similarities and differences between Chinese state-owned enterprises (SOE) and global private firms (MNE) in their investment strategies in African agriculture. Based on 45 in-depth case studies of large-scale investments across four African countries – Uganda, Sierra Leone, Tanzania, Zambia –collected over the course of three years, the authors systematically explore the factors underpinning the logic of accumulation in Chinese state and private investments. The findings show that global private capital – much like Chinese state capital – can act in ways that go over and beyond profit maximisation or self-interest and may make decisions based on political, reputational, and more long-term considerations.

Paper short abstract:

This paper uses quantitative analysis of Chinese infrastructure contracts to highlight the blowback that Chinese engineering and construction firms face in liberal democracies, which is paradoxically worsened by China’s diplomatic overtures via the Belt and Road Initiative (BRI).

Paper long abstract:

China’s Belt and Road Initiative (BRI) has two interconnected goals: increasing China’s diplomatic clout and expanding the presence of Chinese companies overseas. However, contrary to the intuitive notion that successful diplomacy also creates economic opportunities, we argue that when the partner country is a liberal democracy, these goals conflict. Using a global panel dataset of Chinese infrastructure contracts from 2004 to 2019, we first hypothesize and quantitatively uncover a negative relationship between host state liberal democratic institutions and infrastructure contracts won by Chinese firms overseas. Second, we test whether host states’ joining the BRI affects contract volumes. Our results indicate that in states with more democratic institutions, host government joining of the BRI is in fact negatively associated with infrastructure contracts for Chinese companies, pointing to blowback in liberal democracies against the BRI. This study contributes to understanding of the complex relationship between diplomacy, development, and commerce, the domestic politics of foreign countries in shaping China’s overseas presence, and the factors driving China’s overseas infrastructure contracting.

Paper short abstract:

Our research considers how OECD donors should respond to rising Chinese ODA efforts to encourage greater trilateral cooperation.

Paper long abstract:

The OECD has long promoted the better integration and coordination of donor aid efforts to little success. We argue that this outcome is inevitable as donor motives are heterogenous whereas directives are generic for all donors. Considering to what extent OECD donors compete with ODA extended by China, the analysis presented in this paper disaggregates donors into two groups, ‘neoliberal’ and ‘traditional’. We hypothesize only ‘neoliberal’ donors will respond competitively to an increase in Chinese ODA, which is is found to hold true. As such, we suggest that ‘neoliberal’ donors should be leading the charge among OECD Development Assistance Committee (DAC) donors to engage with China given their more akin donor preferences.

Paper short abstract:

China’s influence in Africa is growing at an exponential rate ranging from trade, investment to aid. It is argued that, Chinese investment in African countries undermine the rule of laws and business ethics. This paper investigate the impact of Chinese investments on local regulatory institutions

Paper long abstract:

In many African nations, regulatory institutions remain largely weak, with inexistent or ineffective enforcement arsenal, tools, or instruments. As a result, foreign investors seize this as an opportunity to shift the balance of power to their benefit by taking advantage of the free market system, while, at the same time, dominating world institutions make sure their rules prevail leaving local regulators powerless in the face of the protection of national policies and standards. The recent involvement of China in different activities on the continent, specifically, in Cameroon infrastructures building, the need for the Asian giant to seek for new markets to invest its capital surplus and on the other hand, about Cameroon, factors such as: the need of capital investment, the bargaining power, the asymmetrical vision and the global context revealed the limits of domestic enforcement capabilities. And moreover, the performance of home regulatory institutions, the behaviour of local players responsible of the enforcement, the public bureaucracy, the competitive clientelism, the state-businesses collusion, the rents seeking attitude and the power holds by foreign actors have brought to the fore the debate on the extent of investors’ power to control local legislators.

At the centre of this discussion is an understanding of the way the dynamic of the distribution of power mutually compatible with institutions help achieve sustainable outcomes leading to diminishing policies space. In this regard, the role of both foreign and local actors is explicitly considered.

Paper short abstract:

This paper investigates the emotional aspect of infrastructure development with reference to the Piraeus case. It explores the ways in which emotions constitutes infrastructure development. Simply, what do emotions do regarding infrastructure development?

Paper long abstract:

Emotions are often ignored or downplayed in the analysis of the rationale and process of Chinese investments as the assumption is that infrastructural investment is pursued on the basis of (bounded) rationality which reflect the 'interests' or negotiated interests of the actors who take part in. As such, emotions are explained away by such rational reasoning as economic benefits and geopolitical influences.

However, it is important to understand the role of emotions in infrastructure development investment projects are awash with emotions. For instance, anger, fear, and a sense of betrayal permeated through the whole process of Piraeus investment. 'COSCO, GO HOME!' was the first message sent by Piraeus dockworkers who staged a 6-month strike upon COSCO's takeover. So do pride and hope on the Chinese side as COSCO presented its Piraeus investment loud and proud, claiming it to be the 'dragon's head.' More importantly, emotions cannot be simply discounted as being flimsy or irrational, as they are embedded in political discourses, and affect the perceptions, motivations, and intentions of all involved parties. Recognising the critical role of emotions reshapes how we think about politics, society, and the formation of policy.

Built on the studies of emotions and the logic of affect, this paper investigates the emotional aspect of infrastructure development with reference to the Piraeus case. It asks what emotions have been invoked, and more importantly, the ways in which these emotions have constituted infrastructure development. Simply, what do these emotions do regarding infrastructure development?

Paper short abstract:

BRI wasn’t announced by chance. This contribution aims to show how China has shaped its foreign-policy strategy to become a superpower and how China adapted its domestic policy for that purpose. In addition, what supporting role China’s political system and Chinese culture play in this.

Paper long abstract:

About ten years ago, China’s Belt and Road initiative (BRI) was officially announced by President Xi Jinping in Kazakhstan, it became a mega investment project with international attention and political reactions (B3W, Global Gateway)! BRI is much more than just an infrastructure project, it reflects how China’s strategical understanding looks like. In fact, China has been working on its foreign policy with further global puzzles like RCEP, CAI and CPTPP.

In the domestic policy, China has followed its zero-covid for three years strictly. By December 2022 China has turned 180 degrees and dropped all restrictions overnight, without any plan and preparations. It shows the opposite of a strategy.

Do we in Europe understand China and Chinese? It’s always opaque for western world to look to China. Chinese culture is long term oriented (Hofstede). On the other hand, Chinese business is famous for its flexibility and pragmatism. How can long-term orientation and short-term decisions match in investment?

Increasingly China is perceived as main rival from USA. The perception about China in Europe has turned more negative. Relationship between Russia and China is strongly criticized by the western alliance. At the same time, most of the emerging countries (Brazil, Africa) do follow China’s new world order.

The world has reached its post covid phase. Is Chinese political system resilient enough to boost economic growth again? What has been changed in China after Covid? And how has China changed the world? We need to study these developments thoroughly!