Foreign aid in the new era

The global economic landscape has undergone profound changes over the past few decades. The rise of the global South, emerging economies in particular, has led to a shift in economic power, contributing to a more balanced global development landscape.

Multilateral organizations including the United Nations and the World Bank are increasingly learning from the experience of South-South cooperation, and the global South has become a critical force in shaping a new model of international development cooperation featuring equality, inclusiveness and sustainability. Thus, a more diverse multipolar world is fast emerging. Since the 1990s, the World Bank and the International Monetary Fund have been integrating non-Western actors. These changes demonstrate the increased ability of the global South to reshape the international development system.

Since the turn of the century, China has become a critical driving force for the transformation of international development cooperation thanks to its long tradition of providing aid and taking part in South-South cooperation. China has been constantly consolidating the foundation for international development cooperation by supporting the UN-centered international system, regional cooperation mechanisms such as the Belt and Road Initiative, China-Africa, China-Arab and China-Latin America cooperation mechanisms and the South-South Cooperation Assistance Fund.

The novel coronavirus outbreak has caused changes in the international landscape. Amid this common challenge, the idea of building a community with a shared future for mankind has won wider international support.

In the meantime, deep-seated problems have become more prominent, resulting in mounting instability and uncertainties. Imbalanced development within the developed countries has triggered unilateralism and protectionism; COVID-19 has led to the first rise in the global extreme poverty rate in over 20 years. The global development system is facing major changes as developed nations lose the momentum to lead global development.

As the world's largest developing country, China has been making great contributions to the development and the global cause of poverty reduction, by eliminating absolute poverty in the country, contributing over 70 percent of the global poverty reduction.

China is also supporting the poverty alleviation endeavor of other developing countries, especially the least developed ones, by providing assistance with no political strings attached. Since it began doing so over 60 years ago, China has provided nearly 400 billion yuan ($61.84 billion) in foreign aid to 166 countries and international organizations, dispatched over 600,000 foreign assistance personnel, and announced seven times unconditional cancellation of mature government interest-free loans for heavily indebted poor countries and the least developed countries. China has been vigorously providing medical assistance to 69 countries in Asia, Africa, Latin America, the Caribbean area and Oceania and offered assistance to over 120 developing countries to help them achieve the UN Millennium Development Goals. In 2018, China upgraded its foreign assistance model by setting up the China International Development Cooperation Agency. China's international development governance experience has provided road maps and effective pathways on how to turn the concept of building a community with a shared future for mankind into concrete actions.

To start with, traditional global development assistance, under the leadership of the Bretton Woods institutions, has always imposed Western standards and political strings upon developing countries, resulting in unequal relations between the aid-giving nations and the recipient countries and widening instead of narrowing the South-North gap. Over the past six decades, China has respected and supported every developing country choosing its own development path suited to its own national conditions, and it has emphasized the alignment of international development cooperation with local economic development plans. Only by fully enjoying independence in self-development can the initiative of developing countries be fully exploited to realize better growth.

Second, China is strengthening its capacity building cooperation with countries in need, especially in supporting the enhancement of governance, planning and industrial development capacity. In 2015, China established the South-South Cooperation Assistance Fund and Institute of South-South Cooperation and Development. As of 2018, China had implemented over 200 development cooperation projects in over 30 countries in the fields of disaster relief, healthcare, environmental protection and climate change response.

China is sharing its development experience and knowledge with other developing countries to bolster their self-development capabilities.

Third, China has been promoting the alignment between the Belt and Road Initiative and global development partnerships. Chinese President Xi Jinping proposed the Belt and Road Initiative to further expand and promote China's opening-up to the outside world. He has pointed out that jointly building the Belt and Road to achieve strategic alignment and mutual complementarity among countries and meet the challenges facing the global economy is in the interests of the global community. Alongside greater progress in creating a multipolar world, economic globalization and cultural diversity, people have a deeper understanding of the fact that the Belt and Road Initiative, an important platform for practicing the vision of building a global community with a shared future for mankind, is of great significance and value for solving the dysfunctions, imbalances and disorders in global development governance.

Fourth, economic globalization cannot move forward without international cooperation and coordinated governance. The UN 2030 Agenda for Sustainable Development is a globally recognized series of development objectives. China has realized effective alignment with the UN development system in eradicating poverty, improving food security, accelerating healthcare development, ensuring high-quality education, and promoting ecological conservation and environmental protection. In the meantime, China is striving to seek institutional innovations in the global development system and promote the transformation of the current global development system.

The author is director of the International Development Institute at Nankai University.The author contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.