China and the West: a Conversation with Li Xiaoyun

Li Xiaoyun is a professor and former dean of China Agricultural University’s College of Humanities and Development, and president of the China International Development Research Network (CIDRN), an informal network of more than 20 Chinese research centers, institutes, and university departments that produces research, public events, policy briefings, and publications on China’s international development cooperation. Dr. Li participated in The Asia Foundation’s recent conference, China’s Overseas Development Policy in a World “Beyond Aid,” in Bangkok, where he sat down with the Foundation’s Zhou Taidong.

Can you briefly describe the key philosophical and practical differences between China’s approach to development cooperation and that of the Organization for Economic Co-operation and Development’s Development Assistance Committee?

From reading China’s two foreign aid white papers, you probably will get the impression that there is not much difference between China’s foreign aid and that of the OECD-DAC. China and OECD-DAC member countries share very similar assistance areas and even aid-delivery modalities. However, on a more substantive level, China’s development cooperation is very different from that of OECD-DAC members. The West has a world view and a history of colonialism towards non-European societies that have influenced the structure of its intervention-based aid industry. This structure is clearly evident in the institutional arrangement of aid systems dominated by the West. The organizational structures of established donors such as the World Bank, the UK’s DFID, and Germany’s GTZ; the aid instruments of donor coordination, aid harmonization, and monitoring and evaluation; and the financing mechanisms with accountability requirements are all based on an interventionist model. Politically, the West’s aid program has become an instrument for both capitalist and social lifestyle expansion at the expense of other, long-established local lifestyles. This is the fundamental reason why Western aid has so many problems and the problems have never been solved within the Western system itself.

In contrast, China’s development cooperation actually originated from a different philosophical outlook, and it has followed different principles and strategies. China’s foreign aid also started with political concerns, and to some extent with China’s geopolitical and economic interests; however, it has not been tied to any colonial ideas. The territorial expansion of the Chinese empire did not follow the European style of colonization. There is no interventionist world view, and no impulse to transfer its model to non-Chinese societies. The relationship between China and its “colonies” during the imperial era was largely based on chaogong – tribute to an emperor from a vassal state. Chinese sociocultural norms such as “reciprocity” and “clean the snow in front of your own door” are the basic elements influencing China’s foreign policy. China’s current aid practices of “mutual benefit” and “non-interference” are typical examples. “Mutual benefit” reinforces the ownership and responsibility of the partner country, and better develops equal partnership, because one-way giving creates an unequal power relationship. “Non-interference” lets partner countries develop a homegrown development strategy.

China’s non-interventionist aid policy derives partly from this sociocultural tradition, but also from its own development experiences. China firmly believes that poor countries need to have their own development strategy under their own political and socio-economic conditions. Both success and failure in implementing their own policies will help the country find its own way of development, while strong external intervention will do the contrary.

What are some of the key challenges that the Chinese government has encountered as it expands its international development programs?

Chinese development cooperation now faces new challenges under the new global development architecture. First, as China moves from its previous, marginal status to being one of the central powers in the global system, it needs to have more multilateral perspectives for its development cooperation program, rather than sticking to bilateral channels; second, as a respected global leader, China needs to incorporate the provision of global public goods into its development cooperation program, rather than primarily focusing on its own economic interests; third, China’s development cooperation program needs to be reformed so that accountability can be ensured and transparency, monitoring, and evaluation systems can be strengthened.

What value does China see in “triangular cooperation” with bilateral and multilateral agencies? Will we see more of these initiatives from China in the future?

China has already started triangular cooperation with bilateral donors such as the U.S., the U.K., Australia, and New Zealand, and multilateral donors such as UNDP, FAO, and IFAD. China considers triangular cooperation a tool for learning from other bilateral and multilateral agencies, promoting mutual understanding among different partners, and relieving concerns about Chinese foreign aid among traditional Western donors.

However, China is very careful about any form of triangular cooperation. There are several reasons for this. First, China does not want partner countries to feel that China intends to enter any coalition with others – especially the traditional Western donors – to impose the “aid/development effectiveness” agenda. Many partner countries actually do not want China to become a member of OECD-DAC, because China often can be their leverage in negotiating with OECD-DAC donors. Second, China would certainly go for triangular cooperation if partner countries proposed and welcomed it, but this is unlikely to occur. Third, triangular cooperation, when putting different systems together, is usually more costly in time and money. China, as a developing country, is still constrained by its aid budget, and its aid management institution is short on manpower.

What lessons do you think China can learn from the history of development cooperation by the OECD-DAC?

There are several lessons that China can draw from OECD-DAC. First, China needs to improve its aid regulatory and accountability system to reduce the arbitrariness of decision-making. Second, China needs to establish a scientific monitoring and evaluation system for its aid programs to improve its aid impact and effectiveness. Third, China needs to support and involve civil society organizations in its aid programs to ensure that its aid directly benefits local communities.

What do you think the OECD-DAC can learn about development cooperation from China?

Although OECD-DAC members have long dominated international development aid, both in terms of total volume and general approach, China has become an increasingly influential donor who can offer several lessons for OECD-DAC members. First, OECD-DAC can draw from China’s principles of “mutual benefit” and “mutual respect” in the evolution of their aid policies. An open acknowledgement of the mutual benefit principle avoids the hypocrisy of the current policy discourse by OECD-DAC members. Mutual respect means not only respect for the views of partner countries in negotiating specific aid programs, but also respect for these countries’ own choices of national development policy and direction. These are part of the reason that China’s aid has been welcomed by many developing countries, especially those in Africa. Second, China’s aid is praised by partner countries for its responsiveness and efficiency. China is responsive to the demands of partner countries and has been efficient in decision-making and aid delivery. China’s foreign aid is mainly delivered through in-kind transfers. It does not require a complex project appraisal process, because China considers that the feasibility of any project should be the responsibility of the recipient country. Third, and related to the previous point, China’s aid is less costly. China’s foreign aid is perceived as “real aid” by partner countries, because it does not involve the high costs of consultants and the high costs of managing aid in partner countries.

Looking at the future of development cooperation, do you think China and the OECD-DAC are more likely to converge or diverge in their approaches?

There appear to be many areas where the two different aid approaches are converging. First, there is an increasing recognition from OECD-DAC members that aid should support growth, not only in partner countries, but also in their own countries. The abolishment of stand-alone aid agencies in Canada, New Zealand, and most recently in Australia, and their integration into foreign and/or trade ministries, indicate that the aid policies of these OECD-DAC members are more likely in the future to serve their economic and commercial interests. Second, the China’s Foreign Aid 2014 whitepaper indicated that China has significantly increased capacity building for officials from developing countries. Third, while some OECD-DAC members are increasing investment in infrastructure and economic growth programs, there is also increasing interest in China’s foreign aid to support social development in other developing countries.

Zhou Taidong is a program officer in The Asia Foundation’s Law and Regional Cooperation program in China. He can be reached at [email protected]. The views and opinions expressed here are those of the authors and not those of The Asia Foundation.