Ain’t No Sunshine when Xi’s Gone: What’s behind China’s Declining Aid to the Pacific?

Abstract

The much-awaited update to the Pacific Aid Map showed a sharp drop in China’s 2019 aid spend in the Pacific, despite the pressing development needs presented by COVID-19. While eight of the Pacific’s ten major donors also saw falls in their aid spends from 2018 levels, China Aid dropped the most, falling 31 per cent to just 6 per cent of overseas development assistance (ODA) in the Pacific, a far cry from 2018 reports that the People’s Republic of China (PRC) was set to become the region’s leading donor based on committed aid funds. This In Brief strongly concurs with the map’s authors about the reasons for the relative decline. However, it’s doubtful that 2018 represents a ‘high-water mark’ for China’s aid to the region (Pryke and Dayant 30/9/2021), or indeed any sort of roll back in China’s presence. The nature of China’s engagement with the region is changing — in line with global trends — as China’s state-owned enterprises (SOEs) and policy banks get more creative about how they fund their operations.