Dan Banik & Benedicte Bull: Chinese engagement in Africa and Latin America: does it matter for state capacity?

Authors

Dan Banik and Benedicte Bull

Abstract

China is now a major actor in global development and wields considerable influence in large parts of the world. The success of the Chinese development model has not only challenged the notion that democracy is necessary for development but also questioned the hegemony of the neo-liberal state encouraging and laying the foundations for a thriving private market economy. The Chinese model of aid, loans, and investments highlights the principles of ‘win-win’, ‘mutual respect’, and ‘non-interference’, based on the needs of a country as articulated by the recipient government. Yet, although Chinese aid does not explicitly aim to affect domestic policies and institutions in recipient countries, it does affect them.

In this article, we explore the impact of Chinese aid practices – including grants, loans, and investment policies – on state legitimacy and the capacity of state institutions in sub-Saharan Africa and Latin America. We argue that while Chinese development interventions have highly diverse impacts in various geographical contexts, they tend to strengthen the elites that are in power – whether in government, or those supporting it from the outside. The extent to which Chinese policies contribute to strengthening state capacity depends on the incentives and visions that local elites possess.

Keywords

Aid, elites, state capacity, China, Africa, Latin America