(Quartz Media, New York, 11 October 2017) US president Donald Trump’s plans to slash the American government’s overseas spending has led to a rash of speculation that China could emerge as a new “global leader” on everything from free trade to the world’s fight to combat climate change, including reports that suggest China could become the world’s most generous country as well. The suggestion however is based on a study (pdf) which does not suggest China is in “pole position” to be the world’s biggest aid donor. It breaks down China’s overseas finance by destination and type from 2000 to 2014, and shows that Beijing is sending much more money abroad, but most of that money can’t be described as aid. China contributed over $350 billion in “official finance” to 140 countries and territories over that time, the study says. But much of that official finance wasn’t “official development assistance,” or aid, as defined by the OECD, which is finance specifically for local economic development or to improve welfare in the recipient country; it can’t profit the donor country; and at least 25% of the amount must be provided to the recipient as a grant. Beijing’s loans often come with some very serious strings attached. Often, the money must be used by the recipient country to buy materials or contracts from China’s state-owned companies, which would boost production and profits at home. In other words, the loans are more like a company extending export credit to an overseas customer who buys its goods
