China's foreign aid comes with 'no strings attached'

09:59, April 27, 2011      

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While China's booming economy has allowed it to become a major provider of aid to other countries, analysts warned that Beijing needs to adjust its foreign aid policy to fit the fast-changing world.

At a press briefing on Tuesday, Vice Minister of Commerce Fu Ziying outlined the White Paper on China's Foreign Aid released by the State Council Information Office.

"China does not attach any political strings to its aid. Our foreign aid programs are based on the principles of equality, mutual benefit and mutual development," Fu said. "Many developing countries lack hospitals and roads. Our aid is concentrated on sectors where they need it most."

According to the white paper, by the end of 2009, China had provided 256.29 billion yuan ($39.27 billion) in aid to foreign countries, including 106.2 billion yuan in grants, 76.54 billion yuan in interest-free loans and 73.55 billion yuan in concession loans.

The aid went to 161 countries and more than 30 international and regional organizations. Since 2004, the country's budgeted foreign aid has increased at an annual rate of 29.4 percent.

Yin Jiwu, a professor from the School of International Relations and Diplomacy at Beijing Foreign Studies University, said that unconditional aid does not always result in a win-win situation.

According to The Economist, although China deserves credit for helping millions of Africans, its unconditional aid may indirectly facilitate corruption in the region, resulting in faulty projects that in turn damage China's image.

The lack of transparency in aid deals between African countries and Beijing also helps embezzlers and fuels suspicion, the magazine added.

Pang Zhongying, a professor at the School of International Studies of the Renmin University of China, told the Global Times that it is time for China to attach conditions to its aid.

"With the scale of aid growing every year, its selfless nature may draw suspicion from taxpayers about exactly how the aid is used, especially when it goes to a country with a terrible record of corruption," Pang said.

"We also need to send independent inspectors to check the usage of the aid money, including the details of all the spending, the quality of the project and its impact on the local economy, environment and society. In this way we can improve transparency of our aid and avoid being linked to misconduct," he added.

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Source: Global Times
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