Developmental Assistance Models: A Comparative Analysis of CIDCA and USAID

Recently, China’s State Council Information Office released a white paper titled “China’s International Development Cooperation in the New Era”, which shows the world how China conducts international development cooperation. It demonstrates the country’s commitment to building a community with a shared future of mankind. The paper revolves around three pillars, philosophy, action, and outlook, for common development as presented by the United Nations Sustainable Development Agenda 2030. The two previous white papers released by China in 2011 and 2014 were primarily a response to the international requirement for transparency. However, the current paper presents a vision for a new era in which China undertakes the global responsibilities not as a donor of development aid but as a provider and promoter of development cooperation.

In order to get a glimpse into the Beijing Consensus and understand how it gets down to boosting development through cooperation, it is a sine qua non to explore how China has remained an assistance provider for a long time. It is imperative to decipher how the recent unprecedented surge in China’s foreign assistance programs holds significant implications for global aid and assistance architecture. As the Beijing Consensus holds stark contrast to the Washington Consensus, the aid-assistance structure also diverges to some degree. Many Chinese analysts have characterised the changes in China’s diplomacy as a reinterpretation of its traditional and philosophical principles to meet the changes in the international and domestic scenario. One of the most prominent principles of assistance was presented by Mao Zedong that if China becomes economically prosperous, it needs to give back to the poorer nations and help them in the process of development. Also, Beijing relies on the principles of assistance, which vary in many respects from those of the conventional international donors of the Development Assistance Committee (DAC), specifically regarding “non-interference, mutual benefit, and non-conditionality”. More so, China’s international development cooperation relies primarily on a blend of economic collaboration, Foreign Direct Investment (FDI), trade, and investment deals rather than on the practice of goodies distribution. The latter approach is observed on the part of the United States Agency for International Development (USAID) and other Western institutions like the International Monetary Fund (IMF) and World Bank. Nevertheless, the positive spillovers of the USAID cannot be overlooked.

China’s promotion of its alternate development model is new, and it would take some years to fully understand its challenge to the prevailing development assistance orthodoxy. Nonetheless, the contemporary rise of China as both a regional powerhouse and great power is astounding. Until recently, China’s development appealed to those repressive regimes of the world which were eager to learn and emulate China’s development trajectory and its modernised form of authoritarianism. However, in the ongoing scenario, the outreach of the Beijing Consensus is not limited to the repressive regimes. The Chinese soft power offensive is using an ever-rising influence on the democratic states as well. Such an appeal of China’s development cooperation is raising concerns in the Western world regarding the sustainability of their global outreach and preponderance.

After calling itself the largest developing country globally, China is decoupling itself from the bloc of what Johan Galtung calls the structural imperialists of the West. This refers to the hierarchisation in the developmental interaction between the North and the South. The self-portrayal of Beijing, as a developing country, shapes its understanding of foreign assistance differently. It asserts that its development model stands in contrast to the Western model based on its worldview and approach, posing a new threat to the US dominant posture. As China is not a member of the Organisation for Economic Cooperation and Development (OECD) DAC, it classifies itself as a protagonist of the South-South cooperation. It refers to the North-South collaboration as the partnership of the unequal and portrays itself not as a donor like the USAID but as a promoter of development collaboration. Henceforth there are rising debates on whether this newly found development approach of China will supersede the development orthodoxy of the Washington Consensus or present a developmental trajectory like that of the prevailing Western institutions giving way to a new tide of a global scramble for space.

To decipher the areas of harmony and disharmony between the development assistance models of the North and South, a comparative analysis of the US and Chinese international development assistance is pertinent. Therefore, the China International Development Cooperation Agency (CIDCA) model has been compared with that of USAID to understand better the vision and the approach of the respective states vis-à-vis international development. Five crucial determinants play a decisive role in shaping the modus operandi and the outcome of any development model.

First, a state’s worldview is a significant determinant of how it interacts with other states, subsequently impacting its development cooperation. In the case of the US and other Western nations, their worldview is vertically based on their imperialist legacies. In comparison, a spherical conception presented by China contrasts with that of the US. It considers itself to be at the centre stage while stabilising the autonomous concentric circles of states via cooperative development strategies. The most prominent example of this developmental cooperation model is the Belt and Road Initiative (BRI). BRI is acting as a stabiliser for the least developed countries (LDCs) and developing countries by providing development infrastructure that connects the states of both the Eurasian and maritime realms.

The USAID comes with a backdrop of a value system to promote democracy and structural reformation through institutional mimicry. Contrarily, CIDCA claims to promote developmental cooperation based on philosophical ideas of grant economies and the ancient tributary system. The former signifies the norm of returning the favour, and the latter represents the autonomy, independence, and uniqueness of other nations’ endogenous circumstances.

Second, a model’s standpoint on vision also holds relevance. Comparisons between CIDCA and agencies such as USAID should be balanced by the fact that the definition of development assistance in Beijing varies profoundly from that of the OECD countries. The USAID comes with a backdrop of a value system to promote democracy and structural reformation through institutional mimicry. Contrarily, CIDCA claims to promote developmental cooperation based on philosophical ideas of grant economies and the ancient tributary system. The former signifies the norm of returning the favour, and the latter represents the autonomy, independence, and uniqueness of other nations’ endogenous circumstances. Both these philosophical backgrounds suggest that China aims at promoting the independent development of the cooperating states while relying on the factor of return of the favour.

Third, a mission mainly desired by any model. The USAID and the Western institutions like the IMF and World Bank promote the norms of structural reformations and ground-level reconstruction. On the other hand, CIDCA focuses on the norms of integrated growth and fostering a synergy of development. CIDCA upholds a “mutually beneficial win-win” principle of development cooperation closely aligned with the iconic BRI introduced by President Xi Jinping. Rather than relying on a donor-recipient relationship, CIDCA aims at cultivating development cooperation among equal partners of the South.

Fourth, as far as the approach is concerned, CIDCA and USAID also indicate divergent paths. Though CIDCA has been labelled by the American media as a “new aid agency,” yet the term “aid” is used nowhere in the agency’s agenda. Instead, the agency’s very motto is to gradually do away with aid and extend hands towards development cooperation. In doing so, CIDCA portrays China as a developing country of the South, presenting cooperation avenues for other states in the South, unlike the North’s exploitative model of aid. Development cooperation purported by CIDCA consists less of grants and charitable giving and more bank loans, expertise sharing, trade, and FDI.

Last but not least, the ultimate goal of each agency is also significant to analyse. While the US and China both align their international development agendas based on their national strategic requirements, China prioritises the stabilisation of the external environment as a key foreign policy objective. As the process of globalisation has flattened the world, both the positive and negative spillovers can affect the whole world in a matter of seconds. The 2008 financial crisis and the Covid-19 pandemic are apt examples. To contain the contagion effect, China is proactively assisting the developing states and the LDCs of the South to cooperate on development strategies rather than leaving them at their risk of following the linear growth model of the West.

Despite growing praise around the developing world, China is still facing rising international scepticism based on its rhetoric and discourse. According to the Global Attitudes Survey conducted by Pew Research Centre, the unfavourable opinions about China’s supposedly anti-imperialist decoupling have reached a new high within the West, primarily the US and its allies. A whole new Western discourse is being pronounced to downplay China’s alternative course of international development where it is trying to signify an equalizing partnership between the centre and the periphery. This antagonistic state of affairs suggests that development has also been squeezed into the realm of great power politics. One crucial component of this scepticism is the lack of transparency of Chinese development models tied to an authoritarian regime. As this blend often questions the salience of democracy for development, it questions the whole foundation of Western ideals of modernity, development, and prosperity. Such a subtle yet explicit antagonism between the two models is the primary cause of international suspicion which is yet to be diplomatically tackled by China.

The mainstream Chinese discourse on its development outreach and cooperation revolves around the catchphrase of creating a “community of shared future for mankind”. The policy relevance and intellectual pedigree of this concept are deeply ingrained in a thorough analysis of global trends and inspirations from the philosophical roots of the Chinese vision. At the same time, it also represents a shift from a “hide-and-bide” to a global activist stance in China’s strategic orientation. It indicates China’s self-image as a proactive enabler of worldwide peace, ensuring global development and defending international order. However, the institutions involved in materialising these worldwide objectives remain the same, and global suspicion persists. The question is, will this development cooperation purported by China do any good to the already dismal condition of the economies of the Southern states while enhancing the South-South cooperation, or will it create nuanced avenues for South-South exploitation based on uneven development and the norm of spatial fixes, thus further exhausting the resources and capacities of the losers of modernity.

Rida Fatima

Rida Fatima is a graduate of the School of Politics and International Relations, Quaid -I-Azam University. She serves as a Research Assistant at the Centre for Strategic and Contemporary Research.

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