- Financial Aid in the form of developmental assistance, project assistance, debt relief etc, has been an important policy instrument for China among its various engagements with Africa, and indeed Africa has been a top recipient of Chinese aid.
- The bulk of Chinese financing in Africa falls under the category of development finance, but not aid
The financial aid from China to African countries has always been a subject of intense debate in the international economic parlance. The aid has been increasing year after year and the dependency of African countries to Chinese aid has been increasing last few years. Financial Aid in the form of developmental assistance, project assistance, debt relief etc, has been an important policy instrument for China among its various engagements with Africa, and indeed Africa has been a top recipient of Chinese aid.
The financial aid from China to sub-Saharan countries have exceeded previous highest levels and reached a whopping USD 23 billion between 2017 to 2020 period. This is more than double the combined aid amount of $9.1 billion lent by banks from U.S., Japan, Germany, the Netherlands, France, and South Africa. The report brought out by the Centre for Global Development has highlighted some glaring statistics which has shown a significant erosion of the aid provided by the western countries to Africa. The report also pointed out that the World Bank provided only USD 1.4 billion to Sub-Saharan African countries during 2016-2020 period.
The direct aid of China comprises eight different types: complete projects, goods and materials. Technical cooperation, human development cooperation, medical assistance, emergency humanitarian aid, volunteer programs and debt relief. The question about whether this assistance provided by China is development assistance or aid, has been a question which is raised by many African observers. The bulk of Chinese financing in Africa falls under the category of development finance, but not aid. This fact is privately acknowledged by Chinese government analysts, although Chinese literature constantly blurs the distinction between the two categories. But the assistance by China has been increasing whereas the aid from other developed countries have been significantly slowing down.
