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Foreign Aid and Emerging Powers - Asian Perspectives On Official Development Assistance-Routledge (2014) PDF
Foreign Aid and Emerging Powers - Asian Perspectives On Official Development Assistance-Routledge (2014) PDF
Foreign Aid and Emerging Powers - Asian Perspectives On Official Development Assistance-Routledge (2014) PDF
Current debates on emerging powers as foreign aid donors often fail to examine
the myriad geopolitical, geoeconomic and geocultural tensions that influence
policies of Official Development Assistance (ODA).
This book advocates a regional geopolitical approach to explaining donor–
donor relationships and provides a multidisciplinary critical assessment of the
contemporary debates on emerging powers and foreign aid, bringing together
economic and geopolitical approaches in the light of the 2015 completion of the
Millennium Development Goals (MDGs).
Moving away from established debates assessing the advantages and
disadvantages of foreign aid, this book challenges the current geopolitical
assumptions of the emerging powers concerning issues such as ‘South–South’
solidarity, shared development experience and ‘multipolarity’. It analyses how
donor governments ‘sell’ aid to recipients through enabling different cultural
assumptions and soft power narratives of national identity, and provides empirical
evidence on agendas such as aid effectiveness, aid for trade, public–private
partnerships and green growth aid. The text examines the role of, and relationships
between, the leading traditional and emerging-power Asian donors specifically,
and explores the different and contested perspectives and patterns of ODA policy
through an alternative account of emerging-power foreign aid to leading African
and Asian recipients.
This book provides a valuable resource for postgraduate students and
practitioners across disciplines such as development economics and geopolitics of
development, uniquely approaching the debate from the perspective of emerging
powers and donors.
This Development Studies series features innovative and original research at the
regional and global scale.
It promotes interdisciplinary scholarly works drawing on a wide spectrum of
subject areas, in particular politics, health, economics, rural and urban studies,
sociology, environment, anthropology, and conflict studies.
Topics of particular interest are globalization; emerging powers; children and
youth; cities; education; media and communication; technology development;
and climate change.
In terms of theory and method, rather than basing itself on any orthodoxy, the
series draws broadly on the tool kit of the social sciences in general, emphasizing
comparison, the analysis of the structure and processes, and the application of
qualitative and quantitative methods.
Iain Watson
Routledge
Taylor & Francis Group
LONDON AND NEW YORK
First published 2014
by Routledge
2 Park Square, Milton Park, Abingdon, Oxon, OX14 4RN
and by Routledge
711 Third Avenue, New York, NY 10017
Routledge is an imprint of the Taylor & Francis Group, an informa business
© 2014 Iain Watson
The right of Iain Watson to be identified as author of this work has been
asserted by him in accordance with sections 77 and 78 of the Copyright,
Designs and Patents Act 1988.
All rights reserved. No part of this book may be reprinted or reproduced or
utilised in any form or by any electronic, mechanical, or other means, now
known or hereafter invented, including photocopying and recording, or in
any information storage or retrieval system, without permission in writing
from the publishers.
British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging-in-Publication Data
Watson, Iain.
Foreign aid and emerging powers : Asian perspectives on official
development assistance / Iain Watson.
pages cm
Includes bibliographical references and index.
1. Economic assistance, Chinese 2. Economic assistance, Indian.
3. Economic assistance, Russian. 4. Economic assistance, Japanese.
I. Title.
HC60.W348 2014
338.91´5–dc23 2014000432
ISBN13: 978-0-415-72707-5 (hbk)
ISBN13: 978-1-315-85565-3 (ebk)
Typeset in Times New Roman
by HWA Text and Data Management, London
Contents
Introduction 1
7 Conclusion 244
Index 248
Tables
Asian donors
The book considers firstly, how the different dynamics of regional geopolitics
can directly and indirectly affect donor–donor relationships and how these
dynamics impact on donor–recipient relationships both within and outside the
region; secondly, how the activities of the emerging powers are juxtaposed,
superimposed and can act as a supplementary to these regional dynamics; thirdly,
the ‘rise of the BRICs’ which has somewhat tended to monopolise the emerging-
powers agenda on foreign aid and its analyses. Whilst these groupings have been
identified in the literature, discussions concerning the strategic tensions between
these groups have yet to be placed within a conceptual framework. I have felt for
a while that the assumption of geopolitical ‘seismic shifts’ in the international
system (or multipolarity) has mistaken a particular post-2008 crisis moment for
a universal or evolutionary (albeit non-linear) understanding of the international
state system. Moreover, issues concerning the different contents and forms of
multipolarity from a regional perspective and how these impact on inter-state
relations can, I suggest, be further explored. The debates on emerging powers
and their distribution and forms of ODA can (and should) take into account the
growing economic imbalances, as well as political and cultural transformations,
within and between the emerging-powers nations. These dynamics also directly
and indirectly impact on their regional and geopolitical relations. That is, there
is some anxiety in many Asian donor states, concerning whether to ‘change
direction’ from a development model that has been so successful in the past.
Such strategic decisions on domestic development sustainability are crucial
for a donor’s ODA credibility and its domestic public support. Moreover, such
dynamics also directly and indirectly affect inter-state relations and policies that
impact on natural resource and economic trade issues.
Therefore, I have used my own background in International Relations (IR) theory
to argue that the policies and strategies of emerging powers take place not in some
abstract vacuum but within specific geopolitical and often regional geopolitical
dynamics. It is rightly pointed out that foreign aid reflects geopolitical patterns but
the book asks how and why and what kind of geopolitical patterns. These patterns
might suggest that ODA is either integral or a supplement to foreign policy, as a
‘loss leader’ or a testing of the waters of diplomacy as a way to outsmart donor
competitors to make sure the donor competition is reduced in a ‘winner takes
xii Preface
all’. A policy of ODA in recipient countries therefore represents, both directly
and indirectly, a microcosm of the dynamics of regional geopolitics between the
donors. These policies can also impact on the donor–donor relationships and their
position (and perceptions of that position) with respect to the neighbouring states
in the region.
The book will specifically consider the role of Asian emerging nations (China),
established middle powers (Japan) and new middle powers (South Korea). The
book considers the controversies as to whether aid from emerging powers can be
counted as ‘aid’ or whether aid is new or old, or a global ‘good’ or global ‘bad’.
However the book also considers why these controversies are occurring in the first
place and how these controversies implicitly link to a donor state’s own perception
of itself as a donor with a particular national identity and role. The justification
for this choice of Asian donors in the book is as follows. Firstly, that Asia is a
rapidly developing region with key mainstream and non-mainstream donor states
that all have their own direct (but different) experiences as foreign aid recipients
and now as donors. China and Japan are the second and third most economically
powerful nations in the world, and South Korea is emerging as a new middle
power. Secondly, leading Asian donor states have very different historical and
contemporary national models of economic, political and cultural development.
These models (and their sustainability) impact on how the donors ‘export’ their
development experience and gain credibility from this. Thirdly, the three major
Asian donor nations represent the different geopolitical forms of state as discussed
in my argument. China is a BRIC, South Korea is described as a ‘next 11’ new
middle power, and Japan is regarded as an established middle power and former
regional hegemon. These particular ‘brandings’ influence donor relationships
and donor–recipient relationships in the context of South–South relations and
different approaches to issues of ‘multipolarity’ and ‘solidarity’. Fourth, each
state represents different temporal and historical stages in foreign aid. Japan is a
long-term mainstream donor. China is a long-term donor but not an OECD-DAC
donor, whilst South Korea is a relatively new donor. South Korea and Japan are
both OECD-DAC members whilst China is not. Interrelated questions raised in
the book include:
• How do the geopolitical dynamics between the principle Asian states directly
or indirectly link to their aid strategies and approaches?
• How do the regional geopolitical dynamics between the Asian states as
donors or as traditional or emerging powers directly or indirectly impact on
ODA donor–recipient relationships?
• Why and how do Asian donor states ‘sell’ their ODA to particular recipients?
• What are the principal contents, types and forms of Asian donor aid?
Table 0.1 Top ten major recipients Table 0.2 Top ten major recipients
of individual DAC members’ aid as a of individual DAC members’ aid as a
percentage of total DAC donor ODA 2001– percentage of total OECD-DAC donor
2002 ODA 2011–2012
China 3 Afghanistan 4.0
India 2.4 DRC 2.7
Indonesia 2.3 India 2.1
Egypt 2.2 Vietnam 1.9
Serbia 2.0 Pakistan 1.5
Mozambique 2.0 Indonesia 1.5
Pakistan 1.5 China 1.5
Tanzania 1.5 Ethiopia 1.2
Philippines 1.5 Kenya 1.2
Thailand 1.4 Tanzania 1.2
Source: OECD 2012b, Table 32. Source: OECD 2012b, Table 32.
4 Introduction
As a form of ‘intervention’ by one state in the affairs of another, ODA has been
placed within a broader criteria of International Relations (IR). More broadly, the
intervention in IR has been understood as a variation of either direct or indirect
military interferences in another state’s domestic (or internal) territory (air strikes,
no-fly zones or ‘boots on the ground’), through to trade embargos/sanctions,
as well as economic resource transfers and government bribery, through to
humanitarian aid and the building of ‘prestige’ projects (Morgenthau 1962, 1967).
The objectives of these different forms of intervention have been to secure and
protect national interest and national security.
Given the relationship between foreign aid and foreign policy, there have
been a number of critiques of foreign aid, ranging from concerns with ethical
hypocrisy, counter-productive economic policies, as well as the questionable
relationships with aiding and financing corrupt governments through so-called
rogue aid, and the issue of aid neocolonialism.1 Such debates have been sensitive
in the run up to the 2015 MDG deadline.2 An early example of the link between
aid and national interests (and the subsequent orthodox and revisionist responses
to it) was the 1948–1951 US-based Marshall Plan to post-war Western Europe at
a time of overwhelming US hegemonic power. The plan has served as a leitmotif
for subsequent state-led aid models with varying degrees of idealistic and realistic
appraisals.3 As a tool of foreign policy, ODA does not necessarily link directly
to the complexities of foreign policy decision-making but can, for example, be
indirectly and strategically used to overstretch another donor state’s resources, or
as a form of ‘soft power’ that hides ‘real’ national interests in a particular part of
the world but gains support as part of an alliance.
Post-colonial donors
Some writers prefer the term ‘post-colonial state’ to more specifically chart a
historical, albeit non-linear process. It is sometimes the case, however, that ODA
recipients and donors have been both colonisers and colonised states. Alesina and
Dollar (2000) identified post-colonial national political and economic interests as
being key determinants of donor aid distribution. In their view, an inefficient and
corrupt former colony often gets more donor ODA from its former coloniser than
those states with admirable records of good governance. At the same time, many
emerging donors are using aid to rekindle the narratives of their lost empires.
For instance, Turkey is providing its ODA to former Ottoman controlled regions.
Whilst the ‘shared colonialism’ narrative is emanating from many emerging-
power capital cities, it is the Western donors who tend to want to play down
the former colonial relationship with the recipient. Alesina and Dollar (2000)
identified two sets of ‘colonial variables’ such as the number of years an aid
recipient was a colony of the donor, or whether the recipient was a colony of
another donor. However, in Asia, the question of determining what was or what
was not ‘colonisation’ is still not settled, and the assumptions that Alesina and
Dollar made do not allow for how the deciding of the ‘true’ ‘dates of origin’ of an
event is itself contested and constructed by elite and non-elite versions of national
identity.
Rationale of argument
This book considers the impact of the emerging donors on the foreign aid
and MDGs debate through a regional geopolitics approach. The book focuses
specifically on the behaviour and activities of Asian donors. For this reason a
multi-disciplinary approach is developed but within the rubric of International
Relations (IR) perspectives. I have therefore mainly (but not totally) restricted
8 Introduction
the discussion to explaining the activities of the current leading Asian donors.
I focus on China (as a BRIC country), South Korea (as a new middle power)
and Japan (as an established donor and former regional power). I use the word
China (to indicate the People’s Republic) and South Korea (rather than Korea) to
indicate the ongoing issues regarding the official recognition of ‘national identity’
questions which are intrinsic to how ODA is both justified and distributed.
The book considers how their interactions as regional states, aid donors and
traditional or emerging powers reflects and impacts on foreign aid policies,
approaches, and their justifications. I have restricted the study of their activity to
the recipient regions of Africa (where there is increasing Asian donor activity) and
Asia (the regional neighbourhood). Within these regions I have chosen particular
recipient countries where Asian donor interest is often competing and increasingly
significant, in order to highlight the broader patterns of donor activity as reflecting
the regional and geopolitical dynamics between the donors as regional actors. I
have focused on the two new ‘agendas’ of Asian donor ODA and on which Asian
donors have been particularly proactive. These are the ‘green growth’ policies
and the recent promotion of Public–Private Partnerships (PPPs). Of course there
are a multitude of agendas and approaches currently in existence, but I want to
prioritise these two crucial areas which I argue are increasingly becoming their
own leitmotif for trajectories of Asian donor–donor behaviour in the wider context
of the post-2015 MDG era.
I want to avoid placing the argument in the burgeoning literature on whether
donor intentions or donor consequences are effective, ‘good’ or ‘bad’, or can
provide instruments for poverty cures, resource curses or development miracles.
Various controversies exist on issues concerning the impact of donors on
recipient countries as a result of the ‘scramble’ for diamonds, timber, bio-fuels,
fish stocks, cobalt, copper, iron, to name but a few. Other issues often concern
the political impact of aid, or whether donor activity accelerates development
or reproduces patterns of neocolonial dependency through neglecting or even
destroying the local economy. Frankly, evidence can usually be found to prove
an argument by both sides of the debate, depending on who one talks to and
the data sets that one chooses to confirm suspicions. This trajectory takes away
an understanding of the wider political and economic contexts as to why aid
is provided at particular points in time and why particular options are chosen
(and promoted) by donors and recipients at particular points in time. Foreign
aid assistance or ODA does not occur in an economic or political vacuum,
but rather is a cause and consequence of complex donor–donor relationships
within a myriad of regional cultural contexts and geopolitical dynamics. My
aim is to question the assumptions concerning alignments and relationships
between donors and recipients such as ‘shared developed experience’ and
mutual solidarity. As a result, questions such as why, whose and what form of
alignments or experiences, are issues that are currently under-explored. Thus,
the more specific economic, political and cultural tensions between emerging
powers as donors (and how such tensions also impact on understanding the
relationships between emerging powers) are explored. For some, the emerging-
Introduction 9
powers literature has already focused too much on these wider macro geopolitics
(Scoones et al. 2013).
However, ‘macro geopolitics’ approaches have not, as yet, attended to the
impact of the regional relationships between donors on ODA distribution, type
and form. Even for those who study Asian donors, these comparative analyses
are often done through a comparison of the institutional forms of aid distribution
and assessing the moral intentions of the donors (Kim and Potter 2012a, 2012b).
Instead, my focus is more on placing the Asian donor–donor relationships within
the wider context of regional geopolitical dynamics and exploring why certain
policy options are generated at certain points of time, and why certain choices are
made. These issues are addressed through the following broad questions:
The BRICs meeting in 2010 also stressed that ‘we reiterate the importance of
the UN Millennium Declaration and the need to achieve the MDGs in an inclusive
process of growth and there should be no reduction in development assistance’
(BRICS 2010). The BRICS (2012) Delhi Declaration also promoted the mutual
shared experience ‘to further strengthen our partnership for common development
and take our cooperation forward on the basis of openness, solidarity, mutual
understanding and trust’ and that ‘attainment of the MDGs is fundamental to
ensuring inclusive, equitable and sustainable global growth and would require
continued focus on these goals even beyond 2015, entailing enhanced financing
support’ (BRICS 2012). The notion therefore of ‘commonality with diversity’ is
conventionally seen to reflect the multipolar nature of the changing international
system (Eyben and Savage 2013; Ziai 2011).
This is often regarded as a cement through which to generate a genuine
solidarity in the global South and without threatening the sovereignty of each
state through universal values. However, this promoting of diversity can often
reflect (and be a product of) increasingly tense geopolitical, economic and cultural
relationships. The grouping of emerging powers known IBSA (2004) was created
in 2003 (before the first annual BRIC Conference in 2009) and represents an
informal network of the three current BRICS states (Brazil, India and South
Africa) who are not permanent members of the UN Security Council. One issue
here, therefore, is whether or not the BRICS and IBSA groupings are used and
represent a reinforcing of solidarity between emerging powers or represent
strategic splits. At the same time these groupings have regional and institutional
roles and positioning as well as relationships with other developing nations and
Western nations (Brasilia 2003). This leads to a number of strategic prioritising
options for these nations as to where they see their role and how to achieve it.
These nations also recognise that they not only have a number of strategic options
but that their actions also represent particular roles and ideals for other nations
to fear or to emulate. For instance, China and Russia are often regarded as the
‘heroes’ of the South with power and influence to challenge the West (but from
within the UN), whilst China and Russia are regarded by other developing nations
(and emerging powers) as potential regional threats and as part of the ‘established
system’. Other middle power nations are regarded as ‘non-threatening’ and more
likely to voice the concerns and opinions of other nations.
However, emerging powers have a constant strategic dilemma of whether to
align or join ‘the elite’ or to be a more radical ‘hero of the South’ and assess
what ‘the South’ wants them to be. One other common issue with regard to the
economic and geopolitical sustainability of emerging powers, concerns whether
emerging powers can (or should) divert resources from a particular path or set of
Introduction 15
policy choices (to become more influential or powerful) which have in the recent
past led the emerging powers to be in a position from which such choices and
options have now become available. This is often a matter of risk awareness as
an emerging power may consolidate (but miss opportunities) or change direction
(and possibly undermine previous successes). Such issues are constant themes in
assessing the sustainability of the emerging powers.
Notes
1 Common issues raised with ODA generally have been whether there is a conceptual
problem, or a bad policy alignment or a wrong prioritising of cause and effect (Lucas
1988). There are the well-known issues of rogue aid (Burnside and Dollar 2000; Six
2009; Woods 2005, 2008). Emerging powers are also challenged for using colonialism
as ‘shared experience’ to legitimate control over natural resources and in creating new
forms of aid dependency (Stolte 2012). Bhagvati (2010) has argued that foreign aid does
not alleviate poverty and that more emphasis should be placed on the market. This has
led to debates between writers in the BRICS who emphasise the need for continuing
state assistance to alleviate poverty (Mahr 2013). Firstly, there is a view that cutting
aid can produce failed states (Collier and Goderis 2009; Collier and Hoeffler 2007).
Secondly, arguments have been made that foreign aid has ‘amplified’ democracy in
democracies, and reinforced dictators in dictatorships (Dutta et al. 2013). Thirdly,
foreign aid can crowd out nascent and established business. For instance, emphasis
on assisting the development of one natural energy sector can destroy investment in
other sectors such as manufacturing. This so-called ‘Dutch disease’ may also increase
the local exchange rates as foreign aid dollars are converted into the local currency.
The idea that global exchange rates can be altered by this foreign aid has been subject
to question (Rajan and Subramanian 2011). However, foreign direct investment
(FDI) and speculation can follow aid patterns causing fluctuations in exchange rates
(Garriga and Phillips 2013). Moreover, foreign aid can often mean that recipient
governments do not have to raise tax revenue, and as a result, citizens have less of
a stake in the political realm and thus democracy is eroded. This is what Dambisa
Moyo (2009, 2009a) termed ‘the Boston Tea Party in reverse’. Foreign aid that builds
economic infrastructure (transport/rail/roads) can also be used to extract resources
and a local abundance of a resource may be inflated in value by the global scarcity of
the resource. Local fighting over the resource may also arise as an indirect outcome
of relative local scarcities in other resources. Therefore the aid effectiveness agenda
has gone through its own evolution. The main conferences were convened at Rome
(2003), Paris (2005), Accra (2008) and Busan (2011). Issues that were more recently
identified include building feedback mechanisms and predictability. For others, aid
Introduction 21
effectiveness is now part of a wider question of development effectiveness and the
whole questioning of ‘what is development’ with interest in inclusive development,
human development and social development. However, as Nancy Thede (2013) noted,
an assumed consensus over aid effectiveness can often hide disagreements on other
issues between OECD-DAC nations. Nigerian President Goodluck Jonathan (2013)
also added to this debate recently, by noting that countries such as Nigeria do not
want emerging-power donors such as China to do everything, because that clearly,
‘wouldn’t be fair to the donors’.
2 ‘We Can End Poverty: the MDGs and Beyond’ www.un.org/millenniumgoals/
3 During the early days of the Cold War, foreign aid was regarded as not just a moral
duty but also a means to stop the spread of communism (Kennedy 1961). There
were concerns that with the experience of the inter-war years, economic deprivation
could provide the climate for political extremism in urban and rural areas. The first
big push of state-led aid was traditionally regarded as the Marshall Plan (Marshall
1947). The Organisation for European Economic Cooperation (OEEC) then agreed
in 1960 to create the Development Assistance Group (DAG). This evolved into the
OECD-DAC (Hubbard and Duggan 2009; Hubbard 2009). During the 1970s, World
Bank President Robert McNamara (1973) focused on promoting the World Bank
institution as an inclusive forum to include countries such as China. McNamara also
took advantage of the period of Cold War detente and in 1980 China joined the World
Bank. President McNamara coined the term ‘War on Poverty’ inspired by the Pearson
Commission (named after Nobel Laureate Lester Pearson) which had famously
stated that whilst ‘development is an ancient concept’ it also implies, in the modern
context, ‘progress’ and ‘mans (sic) ability to master destiny’ (UNESCO 1970). This
ostensibly technocratic approach is also reflected in the OECD’s own approach in
determining how much foreign aid should be given in order to kick-start development.
Jan Tinbergen and Hollis Chenery calculated that 1 per cent of a country’s GNI would
be enough to jump start development in recipient countries. This figure was broken
down into 0.3 per cent private aid and 0.7 per cent official state aid or ODA (OECD
2010a). This figure has become the holy grail of ODA contributions, and was (in)
famously reiterated in the 2005 G8 Gleneagles ‘Make Poverty History’ communiqué
(Gleneagles 2005). Questions of financing have become a key feature of emerging
donors’ resources, given their huge financial reserves and given the increasing
austerity in the traditional donor community. The bar of ODA set at 0.7 per cent of
donor GNI, was in fact originally suggested at the 1958 World Council of Churches.
This council had wanted a neat and symbolic figure of 1 per cent of GNI to be given,
yet there was always a concern as to how private flows were to be distinguished
from official state aid. This of course still remains a key centre of controversy and a
myriad of counter-claims regarding and evaluating the exactness of how Chinese aid
is measured (Brautigam 2011b). The 1967 Charter of Algiers (Algiers 1967), formed
by the G77, also wanted more aid to be donated from the West, with connotations
of compensation for previous colonialism and therefore with the assumption that
colonisation had disrupted a particular historical trajectory.
4 The 1933 Montevideo Treaty is often evoked in the Taiwan case, that a state has the
right of territorial integrity even if it isn’t recognised as sovereign. Article 3 of the Treaty
is often invoked to clarify this that ‘The political existence of the state is independent
of recognition by the other states. Even before recognition the state has the right to
defend its integrity and independence, to provide for its conservation and prosperity,
and consequently to organize itself as it sees fit, to legislate upon its interests, administer
its services, and to define the jurisdiction and competence of its courts’ www.cfr.org/
sovereignty/montevideo-convention-rights-duties-states/p15897
5 ‘New Chinese Game Based on Disputes Islands’ The Daily Telegraph 1 August www.
dailytelegraph.com.au/news/breaking-news/new-chinese-game-based-on-disputed-
islands/story-fni0xqlk-1226689691161
22 Introduction
6 The Arctic Council comprises: Sweden, Norway, Finland, Iceland, Denmark, the US,
Russia and Canada. At 60 degrees North, the US, Iceland and East Russia are defined
as Arctic states. At 66 degrees North, North West Russia and the Nordic states are
defined as Arctic states. UNCLOS is made up of 158 states, but is not ratified by the
US.
7 According to the World Bank (2011a), Low Income Countries (LICs) are defined as
those countries with a GNI per capita of US$1,005 or less; Lower Middle Income
Countries (LMICs) are those countries with a GNI per capita of between US$1,006
and US$3,975; Upper Middle Income Countries (UMICs) are those countries with
a GNI per capita of between US$3,976 and US$12,275; High Income Countries
(HICs) have a GNI per capita of above US$12,276. The BRICs acronym changed in
2011 when China invited South Africa to become the fifth member, and the acronym
BRICS was born. However, Jim O’Neill refuted the extension to South Africa, given
its low rates of relative economic growth.
8 ‘Japan’s Second World War Defeat was not just due to the Atomic Bomb’. South
China Morning Post, 9 October www.scmp.com/news/china/article/1327721/japans-
second-world-war-defeat-was-not-just-due-atomic-bomb-says-china
9 Brautigam’s ‘watching the watcher’s’ blog has detailed commentary on work on
Chinese aid to Africa. Yet surprisingly under-explored in the recent ‘local content’
literature are issues of African diasporas who are living, training and learning from
emerging powers’ own development models, particularly in China and South Korea.
Moreover, questions of explaining home-grown ‘indigenisation’ development, such
as ‘whose narrative’ of nationalism or ‘indigenous culture’ and in whose interests,
are also under-explored. Similarly, Ovadia (2013) does not include the role of
Islamic finance. Moreover, in discussions with Cameroonian, Liberian, Nigerian and
Ugandan government officials at a number of aid effectiveness/NGO conventions
held in South Korea, there have been contentious disagreements between official
government and non-state versions of ‘home-grown’ or indigenisation policies.
This is also the role of the diasporas in emerging powers in learning and sharing
the development experience from countries such as South Korea. What is also
increasingly on the agenda is the role of small and medium sized enterprises (SMEs)
(Taiwo et al. 2012). The issue of export credits was included in an OECD (2005)
revision draft of what counts as foreign aid, in the context of reducing tied aid
and increasing untied aid (OECD 2006), that is, to reduce the number of credits
or grants that are either tied exclusively to purchases from the donor country,
or tied to purchases from the donor and one or more developing countries. The
significance of officially supported export credits was noted in April 1978 as a so-
called ‘gentlemen’s agreement’ distinguishing between projects that are financed
with tied aid (still technically ODA) or those financed in purely commercial terms
and therefore not ODA.
10 The Economist (2011) has come up against particular criticism of its approach
to measuring and judging emerging-power aid and in particular Chinese aid
(Brautigam 2011a). In traditional ODA terms however, it is estimated that Chinese
ODA in 2010 was $2 billion or 0.04 per cent of its GNI, well below the 2010 DAC
average of 0.31 per cent. The OECD (2011a, 2011b, 2012a) has a different set of
norms than those espoused by China concerning how ODA is linked to commercial
arrangements by private actors and via official export credits. China’s grants and
interest free loans are often offered to social infrastructure projects (government
buildings/stadiums) with loans and credits used for productive infrastructure
(water, roads, ports) which complement FDI packages which are in turn contracted
to a selected Chinese company, often in so-called special economic zones in the
recipient country (Brautigam and Xiaoyang 2011). One striking feature of Chinese
and other emerging powers’ aid is that the aid is not channelled through the
national budgets, as is common practice with OECD-DAC or traditional donors,
Introduction 23
but used directly on projects. Whilst aid is not tied to ‘conditionalities’ on good
governance, neither can aid be used for or tempt government nepotism or corruption
justified through cultural relativism or ‘diversity’. Instead, as with many emerging
donors, focus is with initiating and financing specific development projects that
are sewn together as a ‘win-win’ package. However, project specificity can also
undermine longer term macro development strategies and the actual process of the
state–business relationship is not always transparent to the recipient government,
never mind the recipient country’s labour force. The OECD excludes this non-
concessional aid in its measurements of ODA, whilst humanitarian aid is not
included in China’s ODA as this aid is often seen by Beijing as a short-term ‘stop
gap’. The OECD-DAC also wants a reduction of so-called ‘tied aid’ (donor aid
given on condition that the recipient procures materials from the donor country)
but this untying might unintentionally encourage more commercial terms such as
export credits, and, depending on the prevailing market climate at the time, might
crowd out the policies and benefits of ODA itself (OECD 2008). As a result, Large
(2008) argued that a lot of the literature on foreign aid has unintentionally produced
a number of false binary choices such as, is aid actually ‘new/old’ or is it ‘good/
bad’. Even so, despite this fair comment, certain trends in emerging-power foreign
aid do emerge. Firstly, emerging-power donors generally tend toward more explicit
emphasis on respecting ‘national sovereignty’ and territorial integrity rather than on
values and rights. Emphasis on territorial integrity and ‘non-intervention’ is often
applied to so-called quasi or ‘failed states’ unable to govern. This makes it much
easier for donors to make their case that they are respecting a state’s sovereign
independence, whilst being heavily active within its territory. Secondly, emphasis
is placed on development cooperation rather than donor–recipient relationships.
Further questions that have often been raised are as to whether South–South rhetoric
is (positively or negatively) just a form of state-led soft power paternalism as a
‘charm offensive’ (Chinaview 2007; Kurlantzick 2008). Thirdly, emerging-power
donors are accused of often undermining (intentionally or not) the traditional
institutions and encouraging policy fragmentation (Roopoonarine 2013). Fourth,
lack of conditionality or ‘non-interference’ can lead to further debt spirals in the
recipient country. Fifth, emerging-power donors often use their own imported
labour rather than the local workforce, which can hamper local development and
reinforce cultural segregations but which is promoted as ‘cultural diversity’.
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Introduction 31
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1 The contemporary foreign aid
debate and emerging powers
Introduction
Common phrases and objectives in the aid debate are for those living in aid
recipient countries to be helped to ‘be lifted out of poverty’ or to escape from a
‘recalcitrant’ poverty. Traditionally the view of both donors and recipients has
been that poverty can be quantified into extreme or absolute (according to the
World Bank group from 2008, defined as living on less than $1.25 a day) or is a
relative concept and process which impacts differently on different communities
and constituents. Overarching this particular issue is the widespread assumption
of previous mainstream donors and institutions that poverty occurs in ‘poor
nations’ and these nations can be helped and lifted out of their poverty by the ‘rich
nations’ and ‘rich donors’. The new geography of aid (or the Aid-2) approach,
however, suggests that poverty (however defined or quantified) occurs both
within emerging-power middle-income states and developed nations (Sumner
2013a, 2013b). Traditionally, poverty has been understood as ‘something’ that
can be technically eradicated through effective institutional mechanisms and by
economic and political development. However, conditions for short- and long-
term poverty can be produced by uneven economic, political, cultural and social
processes. Moreover, eradicating or ‘solving’ poverty, through growth, does
not necessarily mean eradicating or solving processes of economic, political
or cultural discrimination, exclusion or inequality in a recipient country. On
the contrary, Sumner (2013b) noted that a lot of the world’s poor now live in
emerging middle income economies.
Sumner (2013b) also argued that there is a ‘double dilemma’ for aid donors.
This is because substantial amounts of aid are distributed to the emerging-power
countries but these countries may not in fact need large quantities of aid but rather
more effective ‘smart aid’ focusing and a redistribution of wealth. However aid
also goes to those recipient countries that cannot absorb these resources effectively
as a result of their lack of basic institutional and infrastructural development.
This chapter considers these processes and responses in the context of debates
over the post-2015 MDG agenda and how this links to ‘the new geography of aid’
approach. This also includes aid effectiveness approaches. The chapter considers
how or whether emerging-power donors are placed within these changing contexts
The contemporary foreign aid debate 35
and non-linear evolution of aid institutions and agendas. The chapter, however,
identifies the dynamics with regard to the sustainability of the emerging powers
and how this question both directly and indirectly impacts upon an understanding
of the inter-state relationships between these donors.
Ideologies of aid
The original Bretton Woods institution of aid provision (World Bank) followed by
the OECD was conceived in the era of state-led Keynesian economics. This pushed
the view that well-organised and channelled state resources could ‘kick-start’
development. One major paradigm shift in the foreign aid debate occurred during
the late 1970s with the emergence of the neoliberal Washington Consensus. This
market orientated ‘neoliberalism’ was distinguished from the more ‘consensus’ or
‘embedded liberalism’ of the Keynesian era which regarded state governance as
both protector and ‘progressive’. Jacqueline Best (2013) recently noted that the
inherent pressures for neoliberals and at the leading aid organisations is that the
very existence of poverty does not fit with the neoliberal economics of ‘trickle
down’ wealth. Yet the solution often put forward is to set the conditions for more
neoliberalism and a blaming of recipient governments and institutions who are
not fiscally ‘disciplined’ enough. However, recipient countries often complain
36 The contemporary foreign aid debate
that further restructuring cannot be done as their economies are fully restructured.
Moreover, neoliberalism has still not yet produced the desired results, primarily
because the developed nations may talk neoliberalism but practise a round of
unfair protectionism and state subsidies.
Liberal approaches which still see a progressive role for the state, still regard
state-led aid as a technical remedy to poverty and as a reflection of domestic
welfare systems. Fiscal Conservatives who might also follow the neoliberal line
tend to see poverty as something that is either theologically ‘natural’ or a result
of a lack of initiative. Marxists regard poverty and aid as just two sides of the
same coin, both being produced by historically specific (not natural) capitalist
dynamics and vested interests which create a ‘dependency’ of the periphery
on core countries. However, emerging powers are using these instruments
of capitalism and the market through which to generate a power leverage to
create alternatives to the Washington Consensus. A lot of this shift in emphasis
as a normative and practical endeavour, particularly in Asia, can, in part, be
regarded as a form of national self-survival. Emerging powers, particularly in
Asia, have strong memories and shared experience of the post-1997 crisis and
subsequent IMF intervention or ‘one-size-fits-all shock therapy’. At the same
time, emerging-power states are now recognising that their ‘opening up’ to the
global economy has given the state an enviable economic power. In this respect,
the ‘Asian drivers’ are regarded as using globalisation as a mercantalist and
developmentalist policy.
In this respect, attention has turned to whether emerging powers are part of
an increasing convergence of globalisation, or a convergence of only a specific
type of globalisation. There is also the issue of whether emerging powers are
creating a globalisation (with Southern characteristics). Best (2013) argued that
as a result of the ‘technical’ language of neoliberalism, poverty is now regarded
as de-politicised social risk and vulnerability, rather than as a result of complex
economic and political decisions and interests. Mawdsley (2012: 218) also
pointed to this concern in one of her conclusions, stating that even if emerging
donors now bring in a new diversity of ideas, the worry is that ‘this will again
produce a technical and depoliticized understanding of development, both as an
outcome and as a process’. As a result some have begun questioning whether the
ODA debate is now verging on a post-aid trajectory (Mawdsley et al. 2013).
Many emerging and developing economies have made great strides in raising
living standards as their economies converge toward the productivity levels
and living standards of advanced economies … The poorest countries have
little economic cushion to protect vulnerable populations from calamity,
particularly as the financial crisis followed close on the heels of a global
spike in food prices.
(Pittsburgh 2009: No 34)
A year later, in 2010, the BRICs met in Brazil (BRICs 2010) and called for more
reform of the existing global institutions by tapping into the Group of Twenty’s
(G20) role as a multilateral financial organisation and in finance cooperation.
Brazil had also wanted to showcase its growing and responsible geopolitical
role as a regional economic power and to use this in its bid to be a part of the
permanent members of the UN Security Council. Brazil called for ‘support for
a multipolar, equitable and democratic world order, based on international law,
equality, mutual respect, cooperation, coordinated action and collective decision-
making of all States’ (BRICs 2010). The BRICs (2010) declaration stated that ‘the
central role played by the G-20 in combating the crisis through unprecedented
levels of coordinated action’ is that the G20 was confirmed as the premier forum
for establishing international economic coordination. The BRICs (2010) also
called for a reaffirmation of ‘the need for a comprehensive reform of the UN, with
a view to making it more effective, efficient and representative’, so that it can
deal with today’s global challenges to ‘reiterate the importance we attach to the
The contemporary foreign aid debate 45
status of India and Brazil in international affairs, and understand and support their
aspirations to play a greater role in the United Nations’ (BRICs 2010).
Karver et al. (2012) argued that identifying the leading actors for setting the
MDG agenda post-2015 is now the main issue given the rise of emerging powers.
Karver et al. (2012) also argued that the MDGs have ignored the wider issues
of growth and jobs, due to a number of key mis-targets such as on education
enrolment rather than educational content. This is a gap being filled by many
Asian donors such as South Korea and Japan, competing to promote their own
particular educational curriculums and achievements. The UN-ECOSOC (2013)
has also reported that the global community is now ‘moving away from North–
South relationships’ towards one of ‘common but differentiated responsibilities’.
The report suggested that South–South relations have a unique role to play in
development cooperation. Development cooperation actors, it was said, ‘must not
work in silos’ but build on equitable partnerships by reducing fragmentation and
duplication of projects. MDGs, the report stated, ‘remain highly relevant’ but the
report also indicated that assumed concepts and geographical assumptions (such
as West, East, North, South, OECD and non-OECD) now need to be revised.
There is also the question as to whether emerging powers (and emerging powers
providing ODA) have different geopolitical and geo-economic dynamics and
represent a reinforcement of the mainstream aid regimes, or a challenge ‘from
within’ or conversely a challenge ‘from without’.
Moreover, there is the question as to whether aid alternatives are supplementary
or a challenge to the mainstream institutions (from which middle power bridge
nations have a key strategic role). This also introduces the question as to the
content and form of alternative aid policies and institutions in terms of norms,
values and institutional forms (Tunis 2010). One recent issue in changing norms
has been in assessing the role of development financing to help complete the
MDGs. For instance, the Monterrey (2002) Consensus identified the issue as one
of a weak institutional capacity for recipient governments to absorb finance, due
to the politicised nature of required coordination between national ministries, and
as a result of frequent changes in government mandates as a result of the very
processes of democracy that many donors promote. The Consensus also focused
upon a number of suggestions regarding MDG development based outcomes.
The communiqué from Monterrey (2002) suggested the need for national aid
policies and strategies, to promote national development priorities indicators,
more effective institutional capacity development and implementation, better
monitoring and evaluating of country development strategies, more effective
alignment and harmonisation with national institutional systems, and a ‘levelling
of the playing field’ through encouraging South–South partnerships.
At the BRICS conference held in Durban, South Africa in 2013, emphasis
by the five participating states was placed on further promoting intra-BRICS
solidarity with the possibility of setting up a new Development Bank for enabling
financing of development projects in recipient countries. This initiative was also
mentioned as being an alternative to the Western aid institutions of the World
Bank, the IMF and the OECD-DAC, but has also been seen as an attempt by
46 The contemporary foreign aid debate
Beijing to counter the power of the dollar (BRICS 2013; IMF 2013b). Yet a drop
in the status and value of the dollar would also hurt Beijing’s dollar reserves and
in this sense a mutual vulnerability is evident. Either way, a new Bank that would
be financed by the emerging powers and based on their own export-led foreign
reserves would further promote competition in the aid market (IMF 2013a).
Western powers may also regard the current ‘rise of the South’ as a challenge
to their dominance, but based on ‘Western’ capitalist terms and therefore not an
ideological or security threat in the sense of a new Cold War. During the Cold
War, what is now termed the global South, was known as the ‘third world’. There
is now a variety of terminologies such as ‘countries in transition’, emerging
countries, or post-colonial countries. These terminologies also determine the
content of particular state-led narratives on national identity and a soft power
‘state’s place in the world’ and what the state has to offer. This broad heritage
dates back to the 1955 Bandung Conference through to the NIEO of the 1970s.
norms of the OECD-DAC. In this respect the BRICs are both emulating and yet
indicating through this their ability to compete with OECD-DAC. According to
the Global Humanitarian Assistance Development Initiative, in 2011 Brazil gave
$23m in humanitarian aid, Russia donated $28m, and India $19m. India was the
largest government donor to provide aid for the 2010 Pakistan floods ($25m) and
a big donor to the 2005 Pakistan earthquake fund ($40m). In 2005, China reported
giving $107m in humanitarian aid to the UN Financial Tracking Service, and has
provided aid to Zimbabwe, although China was criticised for its low amount of
aid to the Philippines in November 2013 following the typhoon. Nevertheless,
the point made by Brautigam and others was that in terms of its Gross National
Income (GNI) per capita, Chinese humanitarian assistance was higher than
commonly perceived. A lot of Chinese humanitarian aid has been given bilaterally
to the National Red Cross or National Red Crescent. South Africa spent $3.5m on
humanitarian aid in 2011.
The IMF’s (2013a) World Economic Outlook report noted that the rise of the
BRICs now reflects increasing economic strength, but with the view that from
a low start, whilst it is easier to catch up, it is also more difficult to sustain this
growth in the long term unless structural changes are made. The IMF report
also stressed the need for an acceleration in domestic demand in the BRICs
(Kilby 2012). During the recent 2008 global financial crisis, the BRIC countries
aimed at promoting solidarity and mutual commitment. Critics suggested that
such communiqués only served to show an increasing inter-BRIC rivalry and
uneasiness as a result of economic competition. The first BRICs summit on 16
June 2009 was held in Russia. Its first communiqué stated:
The emerging and developing economies must have greater voice and
representation in international financial institutions … We underline our
support for a more democratic and just multi-polar world order based on the
rule of international law, equality, mutual respect, cooperation, coordinated
action and collective decision-making of all states.
(BRICs 2009: Nos 3 and 12)
The IMF World Economic Outlook (IMF 2013b) also noted that emerging
markets and emerging powers may only have net increases in capital inflows
partly due to low interest rates in advanced economies, as a result of the financial
48 The contemporary foreign aid debate
crisis and heavy government bond buying or ‘quantitative easing’ to stimulate
investment. The concern is that this is creating a number of unsustainable ‘bubbles’
and speculation pressure in emerging markets. UNCTAD (2012a, 2012b) recently
reported that new investments in Africa were now being made in green field sites
and start-up small and medium sized enterprises (SMEs). Around the time of the
G8 campaigns, there was a view that a new paradigm shift was underway (Payne
2005, 2006, 2008). Payne (2008) also argued that initiatives such as ‘Make Poverty
History’ continued to, problematically, frame poverty as an exception to neoliberal
rules. Payne (2008) also rightly argued, in my opinion, that there was (and perhaps
still is) too much emphasis, almost obsession, on generating aid harmony and aid
consensus in the leading institutions, which is good diplomacy but ignores much-
needed attention to specific issues of development in concrete time and space.
Emphasis on terms such as ‘consensus’ and harmony is also a feature of Asian
donor aid. However practices can often be imbued with power interests and seen
as more conservatively obscuring top-down paternal interests by excluding any
dissent to authority which is framed through narratives of disorderly disruption
and impudence. Recent OECD (2012a) figures attest to the impact of the financial
crisis on the established DAC donors, reflected as shown in Table 1.2.
The statistics also indicate relatively low ratios of ODA/GNI for Japan and
South Korea. This is despite Japan’s ODA being one of the highest as measured
in $million. Middle powers Denmark, Luxembourg, the Netherlands, Switzerland
and Norway all provide a GNI to ODA above the 0.7 per cent recommendation.
239) has stated its ‘constant efforts’ to improve its institutional ODA policy
such as setting up the ‘Inter-Agency Grants Committee’. South Korea has
also encouraged the BRICSs to sign up, promoting this as ‘inclusive’ but also
providing South Korea with a middle power leverage over agenda setting as a
non-threatening state. South Korea’s 2010 ‘Framework Action Strategic Plan’
provided documentation of shared development experience, the need to reform
its grant system (and ODA to reach 0.25 per cent of GNI) and to develop strategic
50 The contemporary foreign aid debate
partnerships, and credibility. There was a view that the Busan High-Level Talks
represented ‘the end of traditional donor–recipient relations in development
cooperation and recognising the role of diverse development actors including
emerging economies, civil society organisations and the private sector’ (MOFAT
2012: 240). However the issue of the different power leverages between these
actors was not developed. With 3,000 representatives from 160 countries, and
from 70 international organisations (IO)s, 100 parliamentarians and 300 civil
society organisations (CSOs), South Korea aimed to ‘bridge the gap’ between
the developed and developing nations. The obvious question that was raised at
the conference concerned the point that if the previous relationships had been so
successful for South Korea then why did they now have to be changed for other
recipients?
The approaches to aid effectiveness have gone through agenda, norm and
institutional evolution from the early meetings held in Rome (2003), Paris
(2005), through to Accra (2008) and most recently Busan (2011). The usual areas
include questions of country ownership, institutional and policy alignment and
harmonisation. However there are sceptical voices from the South suggesting that
the OECD-DAC approach to aid effectiveness is too close to the elite OECD (and
not the G24 or G77). The OECD-DAC secretariat and UNDP, however, currently
have a financial short-fall of over $4 million on the aid effectiveness programmes
and, as such, the hosting of a Fifth High-Level Convention is still being discussed.
There is debate as to whether these are teething problems or a terminal decline
in interest in aid effectiveness (Tran 2013). The more optimistic Paris (2005)
document statement by aid country donors stated:
We … resolve to take far reaching and monitorable actions to reform the way
we deliver and manage aid … we recognise that while the volumes of aid
and other development resources must increase to achieve these goals, aid
effectiveness must increase significantly as well as its support partner country
efforts to strengthen governance and improve development performance.
The Busan (2011) document also claimed that the earlier aid effectiveness
rounds, such as Paris (2005), had left much unfinished business and that whilst
the UN has the universal mandate on convening agendas and the UNDP country
presence, progress has been made in fostering South–South dialogue to complement
North–South relations as a strategy of common but differential commitments. The
final document from Busan (2011) went on to specify the need for:
a new partnership that is broader and more inclusive than ever before,
founded on shared principles, common goals and differentiated commitments
for effective international development. The nature, modalities and
responsibilities that apply to south–south cooperation differ from those that
apply to north–south cooperation … characterised by a greater number of
state and non-state actors, as well as cooperation among countries at different
stages in their development, many of them middle income countries.
The contemporary foreign aid debate 51
South–South and triangular cooperation, new forms of public–private
partnership and other modalities and vehicles for development have become
more prominent complementing north–south forms of cooperation.
(Busan 2011: Nos 1 and 5)
Terms such as ‘we’ and ‘our’ clearly reflect an assumed approach to state–state
solidarity in producing the common forms of resilience for all, as a state’s ability
to sustain stronger and longer economic expansions, whilst experiencing shorter
and shallower downturns (Boorman 2010; G24 2013; IMF 2009, 2012).
Demographic deficits
Russia and China have particular concerns with population numbers. As I will
point out later, many Asian donors also have similar long-term concerns. For
instance, China’s ‘one-child policy’ is perhaps an example of how a top-down
approach to managing population control can result in counter-productive limits
to longer term and sustainable economic development. This policy has recently
been overturned by the incumbent Chinese government in an attempt to respond
to China’s ageing population and its ‘demographic deficit’.1 Sharma (2012b)
noted the so-called emerging demographic deficits in several of the BRICS
nations. He argued that the ‘demographic dividend’ generation of the 1980s
Deng era is now becoming a fetter on future economic prospects as an ageing
population with more males than females (a result of the one-child policy) has
reduced the numbers of future workers. Due to the rising costs of raising children,
even a government relaxation of the policy does not necessarily increase fertility
rates or make it financially easier for couples to have more children. Moreover, a
gender imbalance has led to a future generation of elderly Chinese men not having
family or state support. For Sharma, one way through this trend is to make it
easier for Chinese rural workers to have more substantive residential rights in the
cities. However, this would mean the need for more infrastructural and real estate
construction and public debt, to offset an increase in rising property prices due to
the increasing demand for housing.
Goldman Sachs’ latest set of projections have looked at more than 70 countries
globally and covers 90 per cent of current world GDP. Goldman Sachs expects the
BRICs to account for 40 per cent of global GDP by 2050 (O’Neill 2011). However,
a key distinction is often made between measuring the BRICS’s economic rise in
absolute terms and the issue of per-capita income GDP or distribution. It is the
issue of distribution which impacts on the argument as to whether such emerging
countries are able to provide long-term ODA and issues of domestic credibility
if there are high levels of domestic poverty. As a result of its rapid development,
by the middle of 2011, China held more than $3 trillion in foreign exchange
reserves, which was close to 50 per cent of its own GDP. The World Bank (2013a,
2013b) however has indicated the need for more regional and global rebalancing,
58 The contemporary foreign aid debate
and regarded the transition to a market economy in China, and elsewhere, as
incomplete rather than flawed. Sharma (2012b) pointed out that India’s growth
rate has slowed to 5 or 6 per cent from previous rates of 8 to 9 per cent over the
last decade. Sharma noted that if countries such as Nigeria or India, with a per
capita income of only $1,500, are only able to grow at 5 per cent per annum, then
there is clearly a structural problem. At the same time, with India now becoming a
major technological hub, start-up smaller businesses from the younger generation
are providing a boost to the economy. If a country with a per capita income level
of $20,000 such as South Korea grows at 4 or 5 per cent, then that, for Sharma
(2012a, 2012b), is a huge achievement. As a result of recent concerns, in 2013
Morgan Stanley named Brazil, India, Indonesia, Turkey, and South Africa as the
emerging ‘fragile five’ (Aslund 2013).
Conclusion
The chapter has considered the evolution of the aid debate and the role of
emerging-power donors as understood in the current literature. The evolution
of the aid debate is now being influenced by, and can also be placed into, the
wider geopolitical transitions occurring as a result of the rise of emerging nations.
However, I have also suggested that more needs to be said about the actual
dynamics and reasons for these dynamics regarding inter-state emerging-power
relationships and between emerging powers themselves. The current literature
therefore does not as yet place the debate into the wider context of the critical
assessments of BRIC and emerging economic, political and social dynamics
from a regional perspective. Thus, in the following chapter I consider what these
IR perspectives are and how they can be used to explain and to understand the
specific Asian regional relationships between the established and emerging Asian
donor countries. These relationships and dynamics, I argue, play a key role in
determining the distribution and content of ODA.
Note
1 ‘China Reforms: One Child Policy to be Relaxed’ BBC News Online 15 November
2013 www.bbc.co.uk/news/world-asia-China–24957303
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2 International relations
perspectives
Emerging powers and the contemporary
geopolitics of Asia
Introduction
Determining the borders of the ‘Asian’ region and determining what counts as
an ‘Asian perspective’ is inevitably controversial. Such questions have been
created and influenced by a myriad of power interests, cultural exchanges and
representations, as well as contested territorial mappings (Victor Prescott 2003).
Moreover, technology and innovations in transportation and infrastructure are
now re-connecting many of the older East–West trading routes and ‘new Silk
Roads’. Interest in trans-continental railways (from Busan to Paris) and overland
trade and maritime shipping routes also play a considerable part in both national
and regional identity construction. These official and unofficial constructions also
impact on the geopolitical dynamics of the region. For instance, recently, there
has been Russian and Chinese interest in connecting the port of Hasan in Russia
to the port of Rajin in North Korea. This would make access to the Northern sea
routes easier for China. Russia and South Korea have called for a trans-Korean
rail-link. Along with a proposed natural gas pipeline, this initiative would also
enable South Korea to gain easier access to Russian Siberia’s abundant natural
resources.
Currently the geopolitics of Asia consists of a growing interest in the direction
of Chinese–US relations (Zoellick 2013). The relationship between China’s
‘dream’ and the United States’ (US) ‘rebalance’ has led to various predictions of
both an increasing interdependence between the states as well as an increasing
bellicosity. These are not necessarily mutually exclusive and have been termed
the US–China ‘cool war’ (Feldman 2013). China’s recent upsurge in regional
military activity has been described as a ‘cabbage’ strategy of unilaterally claiming
maritime territorial rights and then building up a network of security outposts
around this claim. This is leading to a series of ‘overlapping’ maritime, territorial
and aerial sovereignty claims. This strategy is, however, also aware of China’s
‘peaceful rise’ or soft power approach in the region, which builds up Chinese
strength through discreet micro-events or as a ‘crossing the river by feeling each
stone’. Similar strategies are used with respect to Chinese foreign aid. These
developments have also impacted on alliances between regional neighbours
South Korea and Japan. The sense in South Korea and China is that the US seems
66 International relations perspectives
to be increasingly relying on Japan as ‘regional policeman’. This has implications
for issues regarding redefining the post-war Japanese constitution. South Korea is
deciding on where its strategic loyalties reside, either to Washington or to Beijing.
China is South Korea’s leading trade partner and yet the US is South Korea’s main
security guarantor. There are also changes in Indian–Chinese–Russian relations
concerning access over the ‘heartland’ of Central Asia and the sub-continent. This
‘cool war’ between a mutually distrustful and yet mutually reliant China and US
was termed by Niall Ferguson as ‘Chimerica’. This term was a ‘pun’ on the word
‘chimera’ used to describe the ongoing relationship between what Ferguson called
a ‘parsimonious China and a profligate America’ (Ferguson 2011: xvii). The term
‘Chindia’ has also been used to describe the growing economic convergence
and interdependence between China and India as BRICS nations. Here, there
is also mutual economic and military competition between the world’s biggest
authoritarian state and the world’s biggest democracy. This divergence was most
recently manifested in their role as host of the Olympic and Commonwealth
games respectively.
There have been studies identifying the relationship between foreign aid and
foreign policy (Tuman and Ayoub 2004). Such studies have aimed to match
foreign aid to the ‘national interest’ variable over a specific time period. Yet such
studies have not questioned the issue of who sets (and interprets) the boundaries
and the criteria of the ‘national interest’. As a result, such studies engage within
an already preconceived criteria of variables, and often conclude with a set of
‘hedged’ results, that donor states can be scientifically confirmed (rather than
discovered) to be motivated by a mixture of idealism and ‘realpolitik’ (Tuman
and Ayoub 2004).
This chapter takes a less ambitious direction by highlighting how international
relations (IR) literature can help explain geopolitical regional dynamics and
interrelationships between Asian donor states and as to why such expectations
about foreign aid (and associated policies) actually come about in the first place.
The chapter outlines a number of IR approaches to explain these inter-state
relations to suggest that ODA policy can reflect (and be used for) a number of more
subtle and indirect strategic options. These are to test a geopolitical relationship, to
supplement or to provide an alternative to a particular foreign policy, to generate a
sense of ‘national identity’, or as a diversion for specific ‘real’ or vested interests.
The chapter also considers the issue as to what counts as ‘Asian IR perspectives’
in the following ways: firstly, there is the issue of not only determining the content
and boundaries of Asian perspectives but also whether it is possible to use ‘Asian’
approaches in the same way as using ‘Western’ approaches in IR; secondly,
whether a specific Asian approach to IR can be located in Western approaches or
whether Western approaches can be, alternatively, found in various historical and
contemporary Asian approaches; and finally, whether Western approaches can be
used and applied to understand a specific regional system of ‘Asian geopolitics’.
The chapter considers the current geopolitics of the Asian region in order to create
a template of geopolitical dynamics and inter-state relationships which will be
used to explain Asian donor policy and approaches in the subsequent chapters.
International relations perspectives 67
Current geopolitical changes in the Asian region
For Nye (1968) the ‘classic’ (state-centric) approach to understanding the
origin and existence of regions, is to regard a region as a specific geographical
area with an exclusive and limited number of states that cooperate through the
‘pooling’ of state sovereignty in order to solving common security problems. The
subsequent associations and institutions of regionalism are made up of states, and
yet these ‘supra’-regional entities also come, in different degrees, to influence
and potentially limit state sovereignty and autonomy (Hettne 2005; Mittelman
1996). Traditionally understood then, regions comprise a select number of states
with a variety of economic and political relationships and which share a common
identity, values and experiences as a dynamic for greater cooperation. Yet this
approach can often underestimate how the creation of ‘common identity’ and
regional solidarity also relies upon a set of hierarchical processes of ‘othering’.
These processes distinguish one national identity from another. In this sense,
regional ‘diversity’ or ‘commonality with diversity’ is often a result of a myriad
of specific practices of economic, political and cultural exclusions.
One of the paradoxes of Asia is that domestic or national cultures have their
official versions of ethnic and racial ‘homogeneity’ despite the official international
versions of a ‘commonality of diversity’ or ‘unity through (or in) diversity’.
Within particular regions there are also subregions, and those states that reside as
‘bridges’ on the contested borders of and between regions. Often these approaches
also tend toward an understanding of regions as having a pole or centre of gravity
and a regional periphery. Nye (1968) was writing at the time of the shifts in US
hegemony and the rise of Western Europe as a region during the Cold War. This
‘old regionalism’ was heavily influenced by East–West relationships and the
tensions between the Soviet Union and the US. For instance, regional spaces such
as ‘Central Europe’ disappeared as a result of the ‘iron curtain’ division of Europe.
This ‘old’ regionalism was also approached in IR through varying functionalist
and integrative theories (Breslin and Higgott 2000).
The post-Cold War era witnessed the emergence of ‘the new regionalism’,
often understood as representing the new ‘economic triads’ of America, a unified
Europe and Asia. During the post-Cold War era the overall impression has been
that the ‘Asian century’ now represents a simultaneous coupling of Asia to the
global economy. Yet Asia has a potential ‘decoupling’ strategy (as a region) away
from a specific form of Western (neoliberal) globalisation, led by a resurgent and
rising ‘China model’. Moreover, there is a view that given Asia’s rise over the last
few years, an Asian challenge to the West is now resulting in a process of what
has been termed ‘reverse coupling’, as global economic power and leverage shifts
Eastwards. Such processes make for difficult strategic decisions, particularly
for emerging middle powers and if regional formations are seen as a part of a
‘divergence’ from globalisation or led by the powerful regional hegemons. In this
respect, those emerging powers who are becoming more influential regionally,
and as a result of this increased leverage, also want to remain coupled up and
therefore influential in global multilateral institutions such as the G20.
68 International relations perspectives
Recent leadership changes
Firstly, President Xi Jinping of China announced early in 2013 what Thomas L.
Friedman had once coined as ‘the Chinese dream’. This was a phrase seemingly
reflecting both the future aspirations of the new Chinese middle class, and perhaps
for the elite to consolidate (and legitimate) the current political system at a time
of economic transition. President Jinping has been seen to represent a shift away
from the generation of neoliberal technocrats, to a more risk-taking approach
in order to secure China’s longer term sustainability. This is an economic and
geopolitical strategic issue concerning whether the Chinese state continues along
the same path of development (but reforms it) or more fundamentally restructures
the state, and if so, what kind of restructuring might be required. Further issues
raised recently have been as to determining how long this process will it take, and
whether this economic or political restructuring resides (and is allowed to reside)
within the current development trajectory. There is also the issue as to how this
strategic ‘crossroads’ affects other states in the region. This issue is directly linked
to China’s ability to provide foreign assistance to its recipient countries. On the
other hand ‘similar’ sustainability issues in the donor states can also be ‘spun’ and
to derive recipient support and be ‘sold as’ a ‘shared experience’. From this, there
is the further question as to whether a Chinese model is necessarily a non-aligned
model that is a counter to Western globalisation, or a non-aligned model that
‘instrumentally’ uses globalisation to generate a more neo-mercantalist economic
and military response to the West, or a form of less proactive ‘soft bandwagoning’
or ‘soft balancing’ the West. Before President Xi Jinping’s accession, there
were also concerns, more generally in the region, regarding Chinese military
expansionism. Such fears were accentuated more recently in November 2013 with
news of subtle re-drawings by Chinese military cartographers of territorial maps
of the region. Thus, where once there had been ‘dotted lines’ signalling areas of
sovereign dispute, these had now become somewhat bolder and more trenchant.
Early in 2013, Prime Minister Abe (2013) of Japan boldly announced that ‘Japan
is back’ following two decades of economic stagnation and growing domestic
unrest with Japan’s constitution. This does not allow Japan to have an ‘offensive’
military outside of Japan’s territorial and maritime sovereignty (Swenson-
Wright 2013). Following the 2013 inter-Korean crisis, President Park Geun-hye
of South Korea announced a politics of foreign policy based on ‘trustpolitik’
and by promoting domestic ‘happiness’ through the ‘creative economy’ (Keck
2013). President Park (2013) also made the wider point with regard to the Asian
region that it is witnessing an unprecedented and ‘paradoxical’ level of economic
convergences and simultaneous geopolitical divergences.
Realism
For Morgenthau (1978) realism stresses that the science of ‘politics’ is governed
by objective laws which have their roots ultimately in universal human nature.
Politics is regarded as an autonomous sphere of action from others such as ethics,
economics and culture. Realism assumes that power is universally valid whilst
maintaining that universal moral principles cannot be applied to the actions
of states but are filtered through concrete circumstances of time and place.
For Waltz (1979) neorealism stresses that it is the distribution of power in the
international anarchical state structure rather than human nature that can explain
state behaviour (Keohane 1986). For both realists and neorealists, the anarchical
inter-state system is during certain periods at peace. This is a result of a balance
of equal powers or when a strong state is able to act as a ‘hegemon’ and therefore
provide a supply of public goods. Other states may ‘free ride’ on these institutions
but have no incentive to challenge or counter-balance the hegemon. However, a
real or perceived decline in a hegemon’s military and economic power and its
willingness to ‘supply’, inevitably means that there will be a breakdown in those
international agreements which the leading hegemon is now unable or unwilling
to maintain. In this respect hegemonic decline can come about as a result of the
increased costs of maintaining its role, of ‘imperial overreach’ or through an
interconnected domestic breakdown in government or regime legitimacy. At this
point another nation, one that is no longer willing to ‘bandwagon’ the power, may
‘rise’ and be willing to contest with the original hegemon. The rising power will
also want to forge an alliance network of its own, both to consolidate its growing
power and to avoid any potential challenges to its own rise from emerging powers
and those states loyal to the original power.
This means that rising countries may then set up their own alternative regimes
and international agreements or institutions. Less powerful states are then pushed
into a decision as to whether to continue bandwagoning the old hegemon and
continue to use the original hegemon’s institutions, to begin to align with the
rising state, or to create alliances among themselves and become ‘non-aligned’.
Stanley Hoffman (1977) pointed out that the modern discipline of IR had
historically coalesced with the rise of US hegemony in the post-World War Two
era. As a result, the contested methodological issues over the years have been as
to what IR theory is for. Should, for instance, IR theory be scientifically based
72 International relations perspectives
(prediction and explanation) or should it be a more interpretive or transformatory
approach endeavour? There is the issue as to whether it is possible to even have
a ‘theory of IR’ in the traditional and more reflexive sense, and if so, what is
the content of ‘theory’ and can (or should) this theory be universal or only be
understood and applicable to a culturally specific area or location (Callahan 2004;
Kristensen and Nielsen 2013; Paltiel 2010; Vasilaki 2012)? For many Western
realist approaches, the rise of China now taking place is (and represents) yet
another temporal cycle of hegemonic rises within the ‘universal’ state system. In
this respect, the realist view is that a relative redistribution of power (zero-sum)
has taken place and has shifted leverage from Washington to Beijing. As a result,
both powers are now recalibrating their relationship. On the one hand, for realists,
Washington is responding to these changes and preparing for an inevitable conflict
with China through its Asian pivot (or rebalance) and through its shifts to a more
flexible strategy in the Asia-Pacific (outposts and lily-pads). Beijing on the other
hand is waiting for its moment to strike the once dominant power. This strategic
approach makes for difficult decisions for both powers as to whether to pre-empt
each other’s actions (potentially leading to conflict) or to ‘wait and see’, at which
moment an opportunity for victory may have been lost. This is a dilemma for
the rising power insofar as if it waits, then the established hegemon is able to re-
orientate its resources in the delayed time period. However ‘a strike’ too early and
the rising power may undermine its own present and future capabilities, as a result
of not being fully prepared enough.
Many classical realists claim that it is not so much the direct security challenge
from the ‘new’ power on the older hegemon per se that can lead to conflict, but
rather, that conflict occurs as a result of the fear ‘of the rise’ of the new power.
The classical realists view such moments as traditionally based on more ‘agent-
centred’ decisions rather than on the structural shifts of power proposed by the
more ‘mechanical’ neorealist perspectives. The application of these ‘universal’
laws is not unproblematic, and whilst such perspectives might very well predict
or explain an empirical scenario, this does not necessarily mean that a direct
cause–consequence relationship has been established. On the contrary, as critical
voices point out, such a scenario might be very much down to a number of other
coincidental and non-causal factors, particularly in a context where these theories
are not only reflected upon by policymakers (and can be de facto used to ‘justify’
actions), but such theories are also culturally different from the policy practices of
IR (and their assumptions) in a particular part of the world.
The notion of hegemonic rise and fall also leads to questions of ‘inevitability’
and whether to define this shift in power as either relative (hegemonic decline
theory) or as structural. The structural question is also the issue of the continuing
ownership of economic resources, technology and trust in its currency as a foreign
reserve. In this sense, there is a view (particularly with regard to US approaches
to hegemonic decline) that the hegemonic decline thesis merely abrogates
responsibility by the hegemon (Strange 1982). Moreover, there is a view that
narratives on ‘decline’ can become self-fulfilling and, in effect, encourage a
challenge from another state (Nye 2004).
International relations perspectives 73
The role of middle powers in international relations
Whilst hegemonic theory has been used to explain the role of the ‘big powers’,
emerging powers are also said to be ‘middle powers’. Many states in the Asian
region have also been termed ‘middle powers’. Japan is said to represent an
old middle power, whilst South Korea is said to represent a new middle power.
For both realists and neorealists, middle or smaller states are therefore restricted
in their behavioural options but often counter-balance regional and global
hegemons through forming alliances, or to passively buffer or bandwagon the
larger global and/or regional state. Middle powers are too small to effect system
change whilst remaining big enough to generate a concern from the greater states
as a potential ‘rise’ and challenger or from smaller states who are more concerned
with emerging middle power regional hegemony. The hegemonic powers have
the sanction of using a traditional ‘divide and rule’ strategy toward the potential
smaller state alliances through the creation of a passive and conservative
middle power balancing ‘elite’ groups of states. Middle powers may also be
in competition amongst themselves, for instance between first mover and fast
follower states such as BRICS and next-11 states (for instance MINT, MIKT or
MIST).
Old middle powers emerged during the Cold War and tended to align with
or bandwagon either the US or the Soviet Union. These middle powers were
often regarded as ‘friendly’ or regionally passive (Australia/Canada/Japan). At
the end of the Cold War new middle powers also began to emerge. These new
middle powers, particularly in the global South, were seen to be more proactive
and catalysing new agendas and new ideas (such as ODA and green growth).
These states also tended to act as non-threatening bridge facilitators between
the developed and developing world, whilst getting cooperation and interest
in a specific issue agenda. These new middle powers have also tended to act
as ‘managers’ (i.e. setting up new and appropriate institutions and regulatory
frameworks or making existing institutions inclusive). Jordaan (2003) argued
that strategically, middle powers have an issue specific capacity and demonstrate
a propensity to promote a more conservative global cohesion and institution
building, rather than inspire more radical change in the world system, such as
the Soviet Union and China. In this respect, whilst the more powerful states are
active within the global institutions, these states also act as a potential ‘spoiler’
state within these institutions and thus act as more radical elements, contrary
to new middle power states who socialise more and act more conservatively.
Nonetheless, for states outside the institutions, all states within might be regarded
as ‘part of the problem’.
As Matthew (2003) wrote, middle powers are now developing beyond their
conflicted historic role as the ‘lieutenants’ of the great powers by operating
as the selective champions for global peace and justice, and by entering
creative high-impact partnerships with powerful coalitions of non-state actors.
The resources used for this internationalism can adapt to the criticisms from
smaller states that middle powers are also ‘using them’ to gain advantage but
74 International relations perspectives
smaller states may also regard the middle power states as ‘heroes’ due to both
their power configurations of material as well as their ideological leverage
(Spero 2009). Thus ‘Middle powers remain pivotal because they do affect
regional security dilemmas and can influence how great powers might choose
to transform the anarchical international system’ (Spero 2009: 153). A middle
power might want to join (or want to be seduced into joining) ‘the existing
elite’ or might be intentionally or unintentionally used by the bigger states for
co-opting any future threats to the hegemonic system. In this respect, larger
powers may be seen as a beacon of ‘radicalism’ by smaller countries in terms
of the challenge to the West, but they can also simultaneously enjoy status quo
stability although as ‘spoilers’, a position which has often characterised the
role of China and Russia.
Questions have been raised as to whether a middle power can eventually ‘go it
alone’ or would it need to choose a superpower to align with whilst knowing that
this strategy might undermine its newly attained power and status. Hegemons
might also encourage a middle power ‘to look independent’ or ‘cosmopolitan’ so
that when the middle power is later called upon by the powerful state it exudes
‘neutrality’ beneficial to the hegemon’s own long-term ruling legitimacy in
the international system. This is a behaviour that stabilises and legitimises the
existing global order and its traditional organisations. This is to embrace more
compromise positions in international disputes, and the tendency to embrace
‘good international citizenship’. There is also a reliance on ‘trust and credibility’
but this can be easily eroded if such policies are not enacted domestically. In this
sense, bigger powers may free ride on middle power allies, as middle powers have
more soft power credibility for maintaining and upholding international norms,
and are less fearful of ‘free riding’ or first mover initiatives. Middle powers can
develop their own ‘niche’ and new cross-cutting alliances which also require
new forms of middle power alliance consent and legitimation rather than an
alliance that is built on coercive threats. New middle powers have still to match
domestic credibility with international status. Larger powers or hegemons have
the resources to and might also encourage a middle power ‘to look independent’
or more ‘cosmopolitan’ so that when the middle power is later called upon by the
powerful state it exudes this ‘neutrality’ that is beneficial to the hegemon’s own
long-term ruling legitimacy.
The two superpowers, the United States and the Soviet Union, are vainly
seeking world hegemony. Each in its own way attempts to bring the developing
countries of Asia, Africa and Latin America under its control and, at the same
time, to bully the developed countries that are not their match in strength …
(T)he Third World countries shared a common lot in the past and now face
the common tasks of opposing colonialism, neo-colonialism and great-power
hegemonism, developing the national economy and building their respective
countries … (T)he imperialists, and particularly the superpowers, are taking
advantage of temporary differences among us developing countries to sow
dissension and disrupt unity so as to continue their manipulation, control
and plunder … Differences among us developing countries can very well be
resolved, and should be resolved, through consultations among the parties
concerned.
84 International relations perspectives
Japan and South Korea were, in this context, historically regarded as vassals of
China within the hierarchical tribute system. There are still controversial issues,
however, as to whether a unified Korea was a regional part of imperial China (but
not the People’s Republic). Clearly this question is also significant for the defining
of Chinese national identity whilst Japanese ODA to China is often implicitly
interpreted from China as war reparation and as a historical tribute. In this sense,
history, in Asia, is often seen as long term and cyclical (Feigenbaum 2011). For
China, the ideals of mutual respect, non-interference and peaceful coexistence are
key foreign and economic policy directives in the region (Womack 2013). China
also has a very specific approach to multipolarity (Singh 2010). Many Chinese
authors claim to be able to see and predict the future geopolitics of the region
through ‘hidden signs’ of the future struggles which are now shaping the multipolar
world. Deng Xiaoping used expressions from the ‘Warring States period’ of the 3rd
and 4th centuries BC (regarded by some as representing the first multipolar world)
to advise Chinese leaders on formulating a grand strategy through a subtle use of
what is known as taoguang-yanghui or to ‘hide brightness, and nourish obscurity’.
Womack (2004, 2013) argued that in a region with many asymmetric
relationships, the smaller parties should always be reassured of how win-win
provided by the dominant hegemon can be of mutual benefit if the relationship
is open ended and not exclusive to only a few states. This perhaps might explain
China’s charm-offensive approach to opening bilateral relations with ASEAN.
Moreover, depriving the smaller states of having other inter-state relationships,
Womack (2004) argued, can often lead to resentment and a grudging respect,
whilst the smaller states would rather buffer each other and form multilateral and
global alliances to counter-balance the regional hegemon in an emerging world
order (Shaw et al. 2007).
A system of states (or international system) is formed when two or more states
have sufficient contact between them … (A) society of states (or international
society) exists when a group of states, conscious of certain common interests
International relations perspectives 85
… regard themselves as bound by certain rules in their dealings with one
another, such as they should respect one another’s claims to independence …
Firstly, a state’s self-survival is reliant upon its recognising that each of the states
in the system have common interests in maintaining their state sovereignty and in turn
recognise this commonality. Secondly, it is this recognition and constant vigilance
between states that actually creates a vibrant anarchical society through diplomatic
encounters and exchanges. Thirdly, these exchanges then begin to influence the
actual system, and understanding of the system itself, which then becomes reliant
upon the norms and values. These norms and values establish the existence and
consensus over concepts such as state sovereignty and territorial integrity. Such a
process based on respect of sovereign and cultural plurality would be eradicated by
abstract solidarism and universalism. The eradication of plurality would sow the
seeds of conflict. Bull emphasised the term commonality rather than universality
in inter-state relations. This system allows for the maintained sovereignty of states
and therefore war is always a possibility, but this is preferable than through the
‘imposition’ of hegemonic peace from a powerful nation which universalises its
own interests and therefore causes further conflict.
Success on these fronts requires sustained engagement, but it will also require
resources. I know that foreign aid is one of the least popular expenditures –
even though it amounts to less than one percent of the federal budget. But
foreign assistance cannot be viewed as charity. It is fundamental to our
national security, and any sensible long-term strategy to battle extremism.
Moreover, foreign assistance is a tiny fraction of what we spend fighting wars
that our assistance might ultimately prevent.
The current and ongoing ‘cool war’ between the US and China implies an
increasing economic interdependence with geopolitical divergence (Pant 2012;
Park, J-j 2011). For Japan and South Korea, one position emerging is that the two
states might begin to draw closer in order to counter-balance the rise of China
(Mochizuki 2007). This strategy is coupled with concerns from both countries
as to further US distraction elsewhere in the Middle East, the economic crisis
fall out, and a pivot to Asia focusing more on South Asia and the Indian Ocean.
However, for South Korea and Japan this issue invokes historical and identity
controversies (Shambaugh 2010, 2013). The policy of sharing information with
International relations perspectives 87
Japan caused widespread public controversy in South Korea in 2012, although
this was not necessarily with the policy per se, but rather, with the way that the
South Korean government had handled the issue without any genuine public
consultation. For many liberals in South Korea, South Korea should be acting as a
bridge nation rather than being tied into an unequal bilateral relationship with its
former colonial power of Japan or the US (Roh 2003).
Conclusion
This chapter has outlined the main IR approaches in order to explain the regional
dynamics between the Asian donor states. The chapter has identified the current
regional pressures that affect strategies and partnerships including the strategic
options regarding the forms of geopolitical and geoeconomic alliance building,
hedging, and bandwagoning and the reasons why. The chapter has also highlighted
the distinctive forms of strategic options and tensions that emerging powers face
in the region, and explanations as to their behaviour. Within the Asian region, the
BRICs, new middle power states, and former regional powers such as Japan, find
themselves operating with a number of strategic options for alliance building and
conflict. This process of regional competition and forms of regional cooperation
between the Asian donor states is now being reflected (although not directly) in
the Asian donor ODA policies.
Notes
1 ‘China’s Rise: an Opportunity not a Threat’ The China Daily 28 July www.chinadaily.
com.cn/english/doc/2005-07/28/content_464280.htm
2 ‘Clinton to Visit Asia Amidst Territorial Spats’ The Korea Times 29 August www.
koreatimes.co.kr/www/news/nation/2012/08/120_118486.html
3 ‘Chinese Leader Xi Jinping Joins Obama for Summit’ www.bbc.co.uk/news/world-
asia-china-22798572
96 International relations perspectives
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3 Geopolitics and Asian donors
China, Japan and South Korea in Africa
Introduction
Africa has been at the centre of a variety of Official Development Assistance
(ODA) debates for some decades now. Africa has been supplied with a maze of
well-intentioned interventions from the ‘aid industry’, philanthropic individuals
and celebrities, all wanting ‘the African experience’. The creation of aid ‘green
zones’ has also proliferated and many elite aid agencies and NGOs often find
themselves in these secluded communities in the major African cities. Since
the 1984 Band Aid Christmas Single and the 1985 Live Aid concert, Africa has
entered the Western and mainstream donor consciousness. There have also been
the images of African war and famine victims and an ethical narrative of ‘we can
do more’ as itinerant ‘aid’ celebrities continue on their quest to eradicate global
poverty, but subject to criticism (Michaels 2013).
For many, the need for humanitarian and other forms of aid assistance was a
result of Africa’s ‘lost decade’ of the 1980s. This was seen as a result not of ‘natural’
forces but of the enforced Structural Adjustment Policies (SAPs) and subsequent
activities of repressive regimes that were bolstered during the Cold War (Carmody
2012). There is an argument now that what Africa needs is a further integration
into the processes of globalisation. Alternatively there is the view that this would
increase Africa’s marginalisation and that what African nations want is integration
into a more ‘authentic’ or ‘Southern’ defined free trade globalisation. In this sense,
the argument is that aid does not attend to the underlying structural inequalities
between core and periphery countries in the capitalist world economy. Aid can
problematically be regarded as a political instrument used so recipient countries
become more aid dependent and placed into the power of the core countries. This is
also an issue with regard to emerging powers’ donors on the question of ‘tied aid’.
This chapter considers how Asian donors are jostling for strategic influence on
the African continent. This is both for securing their direct state national interests
as well as to prevent donor competitors from securing a ‘winner takes all’ in the
more strategic recipient states. Recently, China secured a non-tender contract to
build a railway link between cities and ports in Kenya and to connect Kenya
with South Sudan, Rwanda, Tanzania and Uganda (Khare 2013; Pflanz 2013).
This is in places an upgrade of an old British colonial line. Beijing is therefore
104 Geopolitics and Asian donors
confident that it will not be branded by the recipient government as a new coloniser
and that such initiatives also symbolically show the ending of the ‘old’ colonial
era. The language of ‘connectivity’ is increasingly apparent with such ambitious
projects. In this respect, the ‘win-win’ approach is based on promoting mutual
interests and ‘equality’ between donor and recipient ‘partner’ countries. However
this relationship is often maintained at the ‘elite-level’ and further questions might
be raised with regard to other constituents such as labour and local business issues
(Pflanz 2013). By creating more railway links, the recipient states may become
more integrated and this may produce objectives for a regional ‘bloc’ with intra-
trade links.
Currently, the forging of such regional zones is hampered by costly infrastructure
and tariffs. This is why many African nations sell products and materials outside
the region. However, a regional formation would provide potential leverage of
recipients over donors. Moreover, a specific donor ownership of infrastructure
(as loans or imported labour and resources) makes it difficult for other donors to
compete and to generate similar ownership and impact. In this respect, other donors
may replicate similar projects in different locations. Here, the recipient country
becomes a microcosm of wider regional geopolitical competition between donors.
Patterns of regional leverage by particular donors are increasingly prevalent,
particularly in sub-Saharan Africa (SSA). The nature of this competition and why
it occurs is clearly important for any recipient government as it chooses where to
acquire donor assistance and from whom. Asian donors are using various forms
of state-led soft power through which to strategically sell their country ‘product’
to recipients by undercutting other donors’ soft power credibility. This chapter
argues that ODA policy itself is subject to distinctive forms of policy, and policy
choices, which reflect donor–donor cooperation and competition. The chapter
argues that providing ODA to African recipients is also being placed in the context
of the different narratives of South–South relations from Asian donors, and by
promoting forms of shared experience, history and ‘solidarity’.
Japan
Japanese aid officially began in 1960, and was originally channelled through the
Ministry of Foreign Affairs (MoFA). In 1961, Japan was the first non-Western
state admitted to the OECD-DAC. Japan has, over the last few years, aimed to
terminate its foreign aid to China and yet has increased aid to India (JICA 2012b).
This termination, for instance, can be subject to a wide variety of interpretations.
Firstly, the original idea of providing and supplying ODA was to increase markets
for Japanese products in China and elsewhere, and to provide an outlet for
Japanese business and technology. Japanese ODA distinguishes between technical
assistance, grants, concessional loans and private sources. In this respect, Japanese
technical assistance became part of the ‘flying geese’ model of development in the
region, under the military umbrella of the US. Whilst Japan still requires Chinese
markets, Japan is also increasing regional competition with China. In this respect,
both countries view bilateral aid through the lens of a hierarchical relationship,
manifested as ‘tribute’ or ‘compensation’ or as ‘technological superiority’.
Secondly, Japan has been more focused on providing ODA as concessional
loans that were project driven ‘on request’ as well as programmes centred on
government-led infrastructure ‘big projects’. However, ‘on request’ was often
seen as referring to requests which were to Japanese companies (Lancaster
108 Geopolitics and Asian donors
2007). Japan was also regarded as being reticent in fully socialising or complying
with the DAC norms of ‘harmonisation’ which the Japanese tend to regard as
‘homogenisation’ and at odds with its strategy of innovation and flexibility. The
idea of ‘harmonisation’ is often critiqued by Western approaches as representing
‘Asian values’ of conservativism and elite-led exclusion of different ideas.
The Ministry of Foreign Affair’s (MoFA) 1992 ODA Charter also emphasised
the promoting of democracy and human rights to indicate its conformity with the
post-Cold War ‘new world order’ of the West, whilst simultaneously distancing
itself from China. Japan’s historical narrative of ‘from recipient to donor’ or
from ‘rags to riches’ has been replicated by South Korea’s narrative on ‘the rise
from the ashes of war’. Grant aid is provided by MoFA and then distributed
by JICA, and loan aid is provided by MoFA, the Ministry of Finance (MOF)
and previously by MITI. JICA (2012a) defined its grant aid as ‘an assistance
method that provides necessary funds to promote socioeconomic development’
and is ‘financial cooperation with developing countries with no obligation for
repayment. Particularly in developing countries with low income levels, such
as Sudan and Pakistan, there is also increasing Chinese interest. Grant Aid is
broadly implemented for building hospitals, bridges and other socioeconomic
infrastructure, as well as for promoting education, HIV/AIDS programs,
children’s healthcare and environmental activities, which directly support
the improvements of living standards’ (JICA 2012a: 19). Grant aid is divided
into project and non-project aid, such as grassroots human security projects,
Japanese NGO projects, human resources development, counter-terrorism,
community building, support for fisheries and farmers, poverty reduction and
post-conflict building. ODA loans are promoted for their ‘efficient use of the
borrowed funds and appropriate supervision of the projects, thereby bolstering
developing countries’ ownership in the development process’ (JICA 2012a:
116). There are project loans (which include engineering service loans and
financial intermediary loans and sector loans) and non-project loans (which
include national programme loans, commodity loans for urgent imports and
sector programme loans).
MITI originally preferred to focus on broad interactions for economic interests
and tied aid, particularly after the 1997 Asian crisis, whilst MoFA has been
more concerned with promoting Japanese diplomacy and soft power. The METI
(Ministry of Economic Trade and Industry) has now replaced MITI. Japanese
ODA simultaneously promotes a ‘Western agenda’ on issues of democracy whilst
not ‘on condition’ by instead preferring an ‘on request’ approach. This is based on
technical expertise and the developmentalist model. For this reason, as a member
of the OECD-DAC Japan was criticised for continuing its aid to China in the
aftermath of the Tiananmen Square violence in June 1989, in what for many
looked like using aid as a mercantilist policy of national interests. However this
emphasis on ‘technical assistance’ is also part of Japan’s policy that ‘transcends’
politics and promotes a ‘reassurance’ that Japan has moved on from its imperial
past (Black 2013). Japan’s policymakers define Japan’s interests and self-identity
through its ODA, separating development from issues of human rights. In this
Geopolitics and Asian donors 109
respect China and Japan, at first glance, can be regarded as having very similar
approaches.
Yet, at the same time, Japan also uses the ‘human security’ ODA approach as a
DAC member by defining itself in contrast to China’s aid and by promoting itself
as a ‘bridge’ between development and humanitarian issues. Similarly, South
Korea has responded by promoting itself as another form of ‘bridge’ between
the developed and developing worlds. According to JICA (2010), Japanese
ODA contributes to international cooperation and stability, and is being openly
promoted to increase the resilience and interests of the Japanese economy. Japan
and China by the late 1990s were, however, making moves for joint cooperative
projects for friendship and peace both in the Asian region and as part of the sharing
of overseas assistance as Japanese aid continued to flow to China (MoFA 1998,
2010). In this respect, ODA policy comes to represent state cooperation or can
be used as a gauge of state relationships. Alternatively ODA might be a ‘pressure
cooker’ release of inter-state tensions or as an insurance to allow for tensions to
occur in other areas and issues.
As Table 3.1 shows, Japanese ODA also follows a pattern of prioritising its
regional ally’s interests (the US) and yet uses this to promote its own ‘human
security’ agenda, promotes a historical form of loans and technical assistance to
the rising regional hegemony (as a form of leverage) and is active regionally in
rising lower to middle income states.
South Korea
The South Korean government has defined its ODA as grants and concessional
loans that government organisations offer developing countries for their economic
development and welfare improvement. Grants are funds that do not entail duty
to repay. Concessional loans come with a duty to repay, but on relaxed terms
with a grant element of over 25% (MOFAT 2010b). In 1991, KOICA was formed
and, in 1996, South Korea joined the OECD, subsequently joining the OECD-
DAC on 1 January 2010. MOFAT provides the grants and KOICA distributes the
grants, whilst the MOSF provides the concessional loans which are funded by
the Export–Import Bank of Korea. Like Japan, the main institutional divergences
occur between its economic interests and soft power diplomacy (ODA Korea
2011). In 2013, MOFAT was reorganised and split into the Ministry of Foreign
Affairs (MOFA) and trade issues are now under the remit of the Ministry of the
Knowledge Economy (MOKE). Like China, South Korea openly accepts its
own ‘developing’ status in order to advance the notion of ‘shared empathy’ with
recipients and to subliminally distinguish its aid from Japan’s ‘establishment
Western’ and even ‘foreign’ approach.
In 2009, South Korea’s leading recipients in Africa were Tanzania, Egypt,
Kenya, Senegal and Ethiopia (KOICA 2009: 37). In Asia, its leading recipients
were Afghanistan, Vietnam, Indonesia, Mongolia and the Philippines (KOICA
2009: 34). One criticism has been that South Korea’s aid institutions are too
fragmented. However, this is justified by the ‘lack of experience’ narrative
110 Geopolitics and Asian donors
Table 3.1 Peer review of Japan’s aid: Japan’s 2010 list of top ten recipients and gross ODA
in $million
Iraq 1402
China 1196
Indonesia 1191
India 949
Vietnam 780
Philippines 559
Bangladesh 540
Tanzania 396
Turkey 354
Sri Lanka 288
Source: OECD 2010b: 7.
The aid community is living in interesting times – an age of choice, but also
an age of uncertainty about missions, goals, and methods. Aid is likely to
become more, not less, prominent as an element of international policy in
the ‘Asian century’ – because the economic engines of Asia will make it so.
Thirdly, the justification of Asian donor aid is usually based on the promotion
of a myriad of competitive and distinct shared experiences by promoting their
authentic historical links between donor and recipient (and by implication the
‘artificial’ historical links of their competitors). Fourth, there is the exporting of
strategic aspect of the indigenous development models (Japan and South Korea)
by promoting shared experiences of physical geography (‘lines of latitude’)
with regard to similarities in agricultural resources and climate change impacts.
Moreover, one country’s self-perceived soft power strength is often repackaged
by another donor as a particular weakness. South Korea, for instance, often
promotes its lack of historical ties and its ‘latecomer’ development status as
indicating that South Korea does not have any ideological or any threatening
colonial ‘baggage’.
China and Japan promote this aspect as a lack of solidarity and a lack of proper
development assistance experience outside of South Korea. South Korea in turn
promotes itself as ‘sharing the colonial experience’ and frequently places ODA as
a ‘reward’ to those recipient states who had helped Seoul during the Korean War.
However, critics argue that South Korea’s 1970s ‘miracle on the Han’ model now
bears no relation to the economic, political and ethnic realities in contemporary
recipient countries, and that its desire to ‘export’ and universalise a unique
historical model has neo-colonial and paternalistic connotations. The defence of
the ‘learning by mistakes’ approach has potential limits given that South Korea’s
soft power credibility is a key feature of its ODA package.
Fifth, China and South Korea both regard South–South relations in very
different strategic ways as a result of their particular geopolitical positioning in
the Asia region and to the international community. China regards South–South
as a bilateral relationship with recipient states, whilst South Korea promotes more
of a ‘triangular model’ of South–South relations between states with South Korea
112 Geopolitics and Asian donors
as the pivot or ‘bridge’. Sixth, there is the ongoing issue of how the Asian donors
tend to focus more on ‘tied aid’ and where priority is given to bilateral loans rather
than grants or through multilateral aid organisations.
In this respect membership of the OECD-DAC has put pressure on Japan and
South Korea to also provide a higher percentage of GNI to their ODA, and yet
membership of ‘blue-chip’ organisations can often justify less resources going
to ‘less prestigious’ multilateral organisations. Moreover, Asian donors also
tend to focus on providing bilateral aid to the LMICs rather than on providing
humanitarian aid or assistance to the low income or lesser developed countries.
Top recipients are often clustered around this grouping with a gap to the next set
of country criteria. This is approach often justified on the basis of ‘results-based’
aid effectiveness. Indeed Japan is now (2012) encouraging the lower and upper
middle income states within regions (such as ASEAN) to help the other low
income states in ASEAN, with Japan as the ‘pivot’ in a triangular relationship.
There is also a pattern that Japan and China are promoting infrastructural
connectivity between these recipients in order to bring a cluster of states into
their orbit and away from donor competitors, leaving recipient states ‘in between’
more excluded.
Africa rising
One increasingly vocalised view in development economics is that ‘Africa is
RISING’ – yet another acronym, but one which is becoming increasingly pertinent
114 Geopolitics and Asian donors
in the aid debate of increasing Responsiveness, Inclusivity, Sustainability,
Integration and Global interests (The Economist 2011; Kaberuka 2010; Mahajan
2009). Whether Africa’s rise is due to the rise of China, or to the neoliberal
policies, or aid effectiveness, or the MDGs, is still up for debate. However, many
sceptics point out that Africa rising is not occurring across the continent and only
for a small middle class elite, and thus does not say anything about the distribution
or ownership of African wealth and resources. Nonetheless, one ongoing question
as a result, is as to whether African states need or want the aid or such ‘gifts’. With
rapid rises in GDP across the continent even during the turmoil of the financial
crisis, it is no surprise that such points are now increasingly prevalent. There are
concerns that this rise is in essence a ‘bubble’ as a result of China’s insatiable
natural resource hunger, and that once the Chinese economy slows, then African
growth will slow.
Carmody (2012) argued that one explanatory view is that Africa is rising as a
result of a greater integration into, and a coupling with, the global economy. The
notion of ‘included’ is particularly state centric and ignores how many groups,
regions and territorial areas of states have already been locked into the global
economy for centuries. The neoliberal narratives on a ‘reintegrated’ Africa imply
that integration means growth and therefore poverty eradication. However this
has to be put in the context concerning issues such as what particular form of
integration, convergence or globalisation is being advocated, and by whom?
One argument for instance is that Africa has had decades of poverty exactly
because it was fully integrated in a global value chain system based on neo-
colonial trade and dependency. Carmody (2012) has also stressed that the
orthodox neoliberal narrative is based on a particularly limited understanding
of ‘economic geography’ which claims that a ‘geographical marginalisation’
is the reason why many groups and states in Africa remain marginalised and
poor. Likewise, Jeffrey Sachs and others have argued that it is through better
infrastructure and more effective communication networks that marginalised
groups and countries can be integrated into the orbit of globalisation. Such
policies, Carmody (2012) recently noted, are also directed by what he termed
a ‘sleight of hand’ from the leading orthodox proponents and institutions
such as the World Bank Group, which tend to regard developing countries as
somehow lagging ‘behind’ the others but can catch up if policy and institutional
bottlenecks are eradicated through technocrats, capacity reform and a ‘big push’.
In orthodox terms a further spreading of integration policies by ‘smoothing’ out
of globalisation means a further pushing and pulling of countries into a global
trajectory (or through big push or neoliberal shock therapy). The interest in
Africa by the major geopolitical powers is also manifested and represented,
along with ODA, by FDI patterns and the increasing militarisation of many
African subregions, such as the Sahel states, through what Carmody termed a
process of donor flexibility and military hegemony or ‘flexigemony’ (Carmody
2012: 5).
Geopolitics and Asian donors 115
Where does Asian donor aid go?
China
According to China’s 2011 White Paper:
China has been increasing its aid for agriculture and grain production
in particular. In recent years, food security has become a global issue,
and China has adopted a series of measures to address this problem in its
foreign aid. For instance, at the UN High-Level Meeting on the Millennium
Development Goals in 2010, China pledged to establish 30 demonstration
centers for agricultural technologies in other developing countries, dispatch
3,000 agricultural experts and technicians to these countries, and invite 5,000
agricultural personnel from these countries to China for training.
Table 3.3 Total amount of Japanese ODA to sub-Saharan African top 10 recipients in 2010
in $million
Liberia 134.31
Sudan 119.08
Tanzania 104.60
Ethiopia 93.89
Cote d’Ivoire 81.26
DRC 80
Uganda 71.24
Ghana 70
Malawi 69.46
Mozambique 62.85
Source: MoFA 2011c.
similar trend. Both Japan and South Korea use Liberia as a ‘flag of convenience’
to lessen the costs of shipping goods to and from Africa.
According to MoFA (2011d) Japan’s highest rate of grant aid (rather than
technical cooperation aid) in 2010, was provided to Sudan which makes up 92.92
per cent of ODA, followed by Kenya (68.85 per cent), the DRC (66.19 per cent),
Ethiopia (65.88 per cent), Tanzania (65.87 per cent), Malawi (49.59 per cent)
and Mozambique (48.95 per cent). Japan is attracting recipients through non-
conditional grants in areas of heavy Chinese loan activity. Raposo and Potter
(2010) pointed to the new maritime routes as being equivalent to a new ‘Silk
Road’. Japan also promotes its ‘human security’ doctrine, which is intrinsic to
the New Partnership for Africa’s Development (NEPAD) and TICAD (Johnstone
and Aoki 2013). Japan is clearly distinguishing itself from China’s focus on ‘hard
power’ aid and South Korea’s bridge power role.
In 2003 at TICAD 3, Japan pledged to extend its grant aid for ‘human centered
development’ and ‘ownership’ by $1 billion for health and medical services (MoFA
2003a, 2003b). At the TICAD conference held on 4 May 2008, Japan also pledged to
double its total net ODA, which was excluding debt relief but including multilateral
Geopolitics and Asian donors 121
funds for the Africa Development Bank (MoFA 2013a; TICAD 2013). The TICAD
5 Yokohama (2013) Declaration promoted the idea of creating state robustness and
resilience, rather than good governance which had been the decades-long mantra
of the OECD-DAC. In this respect as an established non-Western OECD-DAC
member, Japan had the leverage to shift the agenda to match its resource focus.
Japan also has an increasing emphasis on encouraging the private sector (Edstrom
2004). This has been termed a form of ‘discreet diplomacy’ as being both subtle and
effective (UN 2013).
Table 3.4 shows the rate of changes in Japanese ODA to SSA states from 2007
to 2010. The data shows decreases in Japanese aid to Tanzania and Kenya, at a
time when South Korea’s was increasing as Seoul’s priority states. Japanese aid
to Senegal increased at a relatively slow level. Japanese aid interest has slowly
increased in selected West African states which are under increasing Chinese
influence (Namibia). Along the strategic Indian Ocean region Japan’s aid has
been selective with increases to the Seychelles but reductions to Madagascar and
Mauritius where China and India are currently competing, and East African states
of which South Korea has made it known to other donors that it has fully prioritised.
There is a rising rate of Japanese ODA generally in the East Africa connectivity
states (Uganda), as well as emphasis on ‘humanitarian states’ (Malawi), although
previous ‘fragile states’ have seen a reduction in Japanese aid (Sierra Leone).
Japan and South Korea (Table 3.5) are competing for direct and indirect
influence across the different African regions. The strategic question seems to
be determined by donor resource capability to compete where there are equal
resources, or to strategically prioritise in a ‘winner takes all’ approach. Whilst
Asia suffers from natural resource scarcity, Africa alternatively suffers from
natural resource curse (Lawson-Remer and Goldstein 2012; World Bank 2012).
The biggest percentage increases in Japanese ODA to the region of sub-Saharan
Africa (SSA) over the last few years has been to Sudan and South Sudan (along
with China and South Korea) and in post-conflict states (such as the DRC and
Cote d’Ivoire) where mainstream OECD-DAC has been particularly prevalent.
Increases have also occurred in Uganda and Ghana. These are also recipient
states with increasing South Korean influence and ‘smart aid’ prioritising. The
South Korean government has made it clear that Madagascar is a priority area
for growing South Korean food supplies and crops for bio-fuels, and would
be willing to bid high for land rights. South Korea’s geographical position
means direct access to global routes to the Indian Ocean and Pacific Ocean are
ultimately dependent on the status of territorial and resource tensions between
Japan and China maritime influence in the South China Sea. South Korea has been
particularly interested in opening trade routes along the Arctic Northern Seas.
Japan’s DAC peer review indicated that from 2007 to 2008 Japan was providing
its ODA to 146 countries, with the largest amounts of its grant aid being given to
Afghanistan, Sudan, Cambodia, Sri Lanka, the DRC, Tanzania, Kenya, Uganda,
Mongolia and Indonesia (OECD 2010b).
Technical cooperation aid was given in order of preference to China, Vietnam,
Indonesia, the Philippines, Thailand, Cambodia, Afghanistan, Laos, Bangladesh
122 Geopolitics and Asian donors
Table 3.4 Japan’s total bilateral disbursements of ODA to sub-Saharan Africa from 2008
to 2011 in $million
2008 2009 2010 2011
Angola 17.75 6.76 37.62 11.42
Cameroon 15.58 8.11 42.03 23.68
Cote d’ Ivoire 19.51 10.39 81.26 8.17
DRC 51.22 65.70 80 186.74
Ethiopia 47.12 97.76 93.89 119.70
Ghana 54.03 64.80 70 45.94
Kenya 8.79 33.66 36.72 79.74
Madagascar 20.37 19.03 9.62 10.70
Malawi 30.79 35.80 69.46 N/A
Mali 34.52 35.51 38.29 44.06
Mauritius 0.36 −2.07 −2.85 −2.44
Mozambique 23.72 60.67 62.85 48.49
Namibia 9.66 39.82 40.59 25.21
Niger 16.93 35.06 25.16 15.86
Nigeria 28.96 28.88 23.87 38.57
Rwanda 17.75 21.34 22.82 24.28
Sierra Leone 14.13 37.44 12.21 26.53
Seychelles 1.62 9.06 9.57 N/A
Senegal 25.13 46.74 55.21 82.83
Somalia 23.27 22.64 29.07 51.97
Sudan 109.64 111.03 119.08 96.72
Swaziland 3.18 1.19 4.36 12.55
Tanzania 70.99 120.46 104.60 119.44
Uganda 57.01 54.05 71.24 57.12
Zambia 37.14 36.64 46.14 46.08
Zimbabwe 9.97 12.38 18.92 18.10
Source: MoFA 2011d.
and Tanzania. Concessional loans were given to, in order of preference, India,
Vietnam, Turkey, Malaysia, Morocco, Brazil, Armenia, Tunisia, Kazakhstan and
Uzbekistan. In Tanzania, Japan aims to increase rice and food production (JICA
2013b). Both Japan and South Korea are now providing a variety of educational
resources to Tanzania and Ethiopia. In both recipient countries, schools are being
built (and curricula modelled) on South Korean and Japanese teaching practices.
Ethiopia is one of the very few countries in Africa not to have been formally
colonised by a European nation, so the underlying structure of Anglophone or
Francophone education systems is less significant. There is also a greater interest
Geopolitics and Asian donors 123
Table 3.5 South Korea’s ODA to sub-Saharan Africa between 2006 and 2010 inclusive
(net reimbursements in $million)
2006 2007 2008 2009 2010
Algeria 1.82 2.72 3.46 2.6 2.89
Angola 10.09 17.41 25.92 28.34 18.83
Cameroon 0.31 0.27 0.74 0.18 2.57
Egypt 5.64 5.77 7.47 5.57 4.16
Equatorial Guinea 0 0.13 n/a n/a 0.02
DRC 0.31 1.64 2.51 2.47 5.67
Ethiopia 2.29 3.3 4.39 4.16 10.2
Ghana 0.27 1.56 2.51 2.47 6.73
Ivory Coast 1.03 0.85 1.73 0.98 1.23
Kenya 15.47 2.6 1.79 4.5 2.79
Madagascar 0.05 0.52 0.31 0.56 0.51
Mali 0.01 0.27 0.42 0.44
Nigeria 0.42 –0.43 0.81 1.36 3.11
Rep. Congo 0.25 1.05 0.34 0.01 0.27
Rwanda 0.34 0.84 1.35 2.31 6.86
Senegal 0.85 2.43 10.25 5.92 14.85
Sudan 0.66 1.34 2.63 1.37 1.56
Tanzania 3.84 9.42 7.15 9.19 21.46
Uganda 0.16 1.29 0.68 1.24 1.98
Zambia 0.21 1.05 0.68 0.92 0.92
Zimbabwe 0.16 0.41 2.13 1.17 2.06
Source: ODA Korea 2011.
in West African states such as Ghana, from both Japan3 and South Korea.4 In a
recent report from the AfDB and the AU (2009) it was estimated that Algeria
had current offshore oil reserves of 300 million and onshore being estimated at
160–300 million barrels, whilst Angola’s offshore oil reserves were estimated at
160 million barrels and onshore at 160–300 million barrels. The report estimated
that there are approximately 160–300 million barrels each in Chad, Egypt, Gabon,
Libya, Nigeria and Tunisia. Angola and Nigeria currently produce, in total, 4
million barrels per year (Burgis and O’Murchu 2012; Callus 2013; Kim 2010).
Africa still has oil reserves which are estimated to be around 76.7 billion barrels,
which is estimated to be around 7.2 per cent of the world’s total estimated supply.
Korea has recently increased its ODA to Africa, doubling its support to the
region through ‘Korea’s Initiative for Africa’s Development’. In an era when
the international division of labor and increased coordination are paramount,
maintaining this geographic focus is necessary. Although aid to other regions
is very important, as Korea scales up its giving it should stay focused on
East Asia, an area in which it has a comparative advantage. It is expected
that OECD/DAC membership will help fulfill the policy commitment of
expanding Korea’s contribution to the international community and will help
systematically improve Korea’s aid system … this experience could help
build a bridge between the two communities. If a ‘Seoul Declaration’ on aid
effectiveness is announced at HLF-4, it would greatly contribute to global
development, and it reinforces Korea’s national renaissance and further
enhances its image in the world.
Kang (2011) reported that South Korean exports to Africa were up 10-fold
between 1990 and 2010. Top destinations for South Korean trade exports were
Liberia, Egypt, Libya, Algeria, Nigeria, Angola, Morocco and Sudan. South
Korean FDI was going to Madagascar, Nigeria, Libya, South Africa, Mauritius,
Egypt, Ghana and Angola, with sectors including mining measured at 77 per cent,
but infrastructure at 1.2 per cent, where aid rather than FDI has been used to build
a ‘soft power’ image. The third Korea–Africa Economic Cooperation Forum
(KOAFEC III) reinforced these commitments. KOAFEC aims to consolidate the
understanding between Africa and South Korea and share development experience
(Chung 2012). There were two MOUs (memorandum of understanding) between
the African Development Bank and South Korea as a knowledge partnership
strategy and to build on the growing trade and investment flows between South
Korea and Africa. North and South Sudan and Rwanda were more recently
designated priority states. According to the NGO Grain (2009), which deals with
donor land acquisitions and land ownership particularly on food security issues:
Sudan and South Sudan are now being termed as South Korea’s new
‘breadbasket’ for food, requiring infrastructure to be able to ship out of East
African ports (Jeong 2008). Similarly the powerful farmers’ lobby in Japan has
meant that the government is unwilling to open the economy up to competition
on food, and in what is seen as an attempt to undercut the national farmers’ lobby,
to grow food resources overseas. According to the OECD (2012b: 104–108), in
2010, Seoul’s gross bilateral aid was measured at 73 per cent of its total ODA,
with gross multilateral aid at 27 per cent of its ODA. Between 2006 and 2010,
South Korean aid to Africa rose from 14 to 16 per cent, to Asia from 49 to 67 per
cent and to the Americas from 7 to 8 per cent. To the least developed countries,
there was an increase from 26 to 40 per cent of South Korean bilateral ODA,
which is exactly on the DAC average in 2010 of 40 per cent. South Korean ODA
to the lower middle income countries (LMICs) had fallen from 58 to 43 per cent
but this was still higher than the DAC average of 37 per cent. To the upper middle
income countries (UMICs) South Korean ODA was recorded as stable at 3 per
cent but still below the DAC average of 9 per cent. In terms of sector distribution.
according to the OECD (2012a) South Korean ODA was channelled into the
sectors shown in Table 3.6.
Asia donors provide much higher percentages of ODA to the infrastructure
sectors. According to the OECD (2013d) bilateral distribution to African recipients
from all OECD-DAC members by main aid sector included those shown in
Table 3.7.
Table 3.7 shows how Tanzania and Kenya received the highest amount of
OECD-DAC aid for infrastructural projects and where Chinese projects are
accelerating. Humanitarian aid was at the highest levels in the DRC, Ethiopia,
Kenya, Somalia, Sudan and South Sudan and East Africa generally. KOICA
(2010) reported that the highest sector for South Korean ODA to Africa was in
the area of education, with ODA (as measured in $million) being provided to
Tanzania (9,640), Ethiopia (9,551), Rwanda (6,103), Tunisia (5,085) and Egypt
(3,896). The DAC Peer Review of South Korea noted that South Korea was now
‘building a strong reputation’ for its ODA policy, reflecting a more active new
middle power approach, and that South ‘Korea has also played a leading role in
the G20 development agenda, working closely with the OECD and often serving
as a bridge between DAC members and the BRIC countries’ (OECD 2012b: 24).
The OECD (2012b) also reported that South Korea had made significant
efforts to increase and improve both North–South and South–South relations
through what it regard as triangular cooperation, emulating Japan. South Korea’s
role in the aid effectiveness debates also emphasises a ‘me first’ or ‘first mover’
capacity. South Korea is quite open about its national interests where it sees ODA
as a key foreign policy component (OECD 2012b: 26). South Korea has priority
states Cameroon, the DRC, Ethiopia, Ghana, Mozambique, Nigeria, Rwanda and
Uganda (OECD 2012b: 28).
Table 3.6 Comparison of South Korean and OECD-DAC priority sectoral aid as a percentage
of total bilateral aid in 2012
South Korea DAC
Administration 43.8 40.5
Education 7.3 3.4
Health 10.7 5.6
Economic infrastructure 27.9 17.1
Humanitarian 0.9 8.1
Source: OECD 2012a, Number 19.
Mutual respect and treating each other as equals have become an important
consensus of the international community. Respect for sovereignty and
territorial integrity, as well as respect for countries’ right to independently
chose their own social systems and paths of development, are not only
important principles enshrined in the UN Charter, but have increasingly
become guiding principles for countries with differing social systems and
development levels to establish and develop their relations.
(Jintao 2005: 3)
The Koreas
During the 1960s and 1970s, North Korea was the more internationalist, developed
and proactive Korean state across Africa. South Korea was more concentrated
on its own development. However during the early developmentalist era of
President Park (1961–1979) delegations were sent to Africa to gain a regional
recognition of the South as being the ‘official Korea’ and future ‘unified Korea-
in-waiting’. National identity narratives over the content of ‘authentic Korea’
include particular interpretations of official history, national heritage artefacts
and competition between the two Koreas over the number of World Heritage
Sites that are residing within their own territorial space. Neither North Korea
nor South Korea recognise each other as sovereign states and both their national
constitutions claim full sovereignty over the entire Korean peninsula (Kim, S.-j
2013). There is a concern that South Korea is using its ODA to ‘reward’ and
pay back those recipient countries who helped South Korea during and after the
Korean War (1950–1953).6 Like Japan, South Korea is using a particular narrative
on highlighting its own historical ties to Ethiopia. Ethiopia had sent a number of
its elite troops from Emperor Haile Selasse in 1951 to fight in the Korean War on
the side of the South and the UN (Last 2012).7 The three democratic states (India,
Japan and South Korea) do recognise the importance of public opinion and one
130 Geopolitics and Asian donors
new development in Japan and South Korea is the emphasis placed on cultivating
positive domestic public opinion attitudes on ODA (Chang 2010; Potter 2012;
Scheyvens 2005; Traphagen 2013). On the Korean peninsula, both Korea’s claim
that ‘the other Korea’ is using unification as ‘imperialistic’. Both Chinese and
South Korean narratives often place Japan as the ‘former regional hegemon’ and
‘coloniser’.
However, a generation of African leaders has been brought up on technological
imports from Asia which were, during the 1980s, mostly Japanese made and
Japanese innovated (Chung 2012). In countries such as Ethiopia and Ghana, many
imported motor vehicles were made by firms such as Toyota and Mitsubishi, whilst
motorbikes were made by Suzuki, Yamaha and Kawasaki, and the latest Walkmans
were imported from Sony. For many Ethiopians, for instance, memories of the
so-called ‘Japaniser’ approach of the 1980s has also meant a particular view of
modernisation (a Meiji Restoration in Africa). For instance, Japan had a relatively
strong historical link to Ethiopia in the modern era. Indeed, the rise of Japan in the
early 20th century was regarded by many countries as a form of solidarity against
European colonialism.
However, Ethiopia (like Liberia) was never officially ‘colonised’ by the
European powers. Indeed China was never fully colonised by Japan. Thus, in
those African nations that were officially colonised, the image of Japan can be seen
to be swinging between that of a non-Western liberator or just another powerful
hegemon. However, there was little criticism from Ethiopia regarding Japan’s
expansive role in Asia during the 1930s and 1940s (Maruko 2013). Paradoxically,
selected South Korean narratives on this historical link between South Korea
and Ethiopia have also focused on how Ethiopia provided elite troops to fight
North Korea during the Korean War. Yet the Korean War has been placed in South
Korean national history as having been caused by the ‘foreign’ division of Korea
which was a result of previous Japanese colonialism. Such narratives would seem
to place pressure on Ethiopia to ‘choose’ its donor. In this respect, the provision
of textbooks and subject curricula to African recipients becomes particularly
sensitive.
Nonetheless, during the early 20th century, Japan was often regarded by many
states as its own particular ‘hero of the South’. Japan’s ‘axis’ with Nazi Germany
was also regarded by many in the colonised states as a challenge to the old
European imperial powers such as Britain and France. However both Britain and
Japan also had similar imperial aspirations and concerns with ‘national liberation’
movements within their domains. In Korea, Britain and Japan collaborated over
resisting the Korean independence movement during the 1920s by closing down
publishing houses and imprisoning newspaper reporters and activists. Yet this
historical chronology has also generated an element of solidarity between India
and Japan, and more recently between India, Myanmar and Thailand. Prime
Minister Singh (2013) of India recently stated the ‘shared colonial’ argument in
2013:
Geopolitics and Asian donors 131
India’s relations with Africa are rooted in the history of our solidarity against
colonialism and apartheid. Mahatma Gandhi developed the tools of peaceful
resistance on this very soil. Our engagement with Africa has come a long way
since then and today we have built a new template for partnership in the form
of the India–Africa Forum Summit. This partnership is guided by the vision
and priorities of our African partners. India will assist Africa in charting its
own course through institution-building, infrastructure development and
technical and vocational skill development. The pan-Africa e-Network for
tele-medicine and tele-education, which is functional in 47 countries in
Africa, is a major success story of our institution-building partnership with
Africa. We are ready to work with our African partners on e-governance
to help bridge the digital divide in Africa. India is also happy to share its
experiences of participative political institutions, local governance, media
and civil society with Africa.
The growth of India as a BRIC therefore means little choice for BRICs as
emerging-power states both need to be involved in ODA for promoting their own
‘development’ prestige and to stop donor competitors in the ‘winner takes all’
approach to so-called resource diplomacy to secure oil, food supplies and rare
metals. The main competitor for resources is China. India imports 11 per cent
of its oil needs from Nigeria and is pushing for new territories in Angola. It is
estimated that India will overtake Japan to become the world’s third-largest net
importer of oil, after the US and China. In 2013, it was estimated that African
countries received approximately 7 per cent of India’s technical assistance budget,
and several hundred million dollars to help establish educational assistance in
Uganda, Ghana, Botswana and Burundi, where Japanese aid is also heavily active,
indicating increasing Indian–Japanese potential cooperation at crowding out
Chinese influence. The Second India–Africa Forum in Ethiopia also emphasised
the ties with India in the African independence struggle, and the need to align
a common position on UN Security Council reform where Africa and India are
‘under-represented’. The communiqué from the AIFEH (2011) held in Addis
Ababa, Ethiopia, also stated that:
Africa and India reiterate the mutual desire to expand economic cooperation
and trade and investment linkages between them. Recognizing that trade
and investment between Africa and India have increased, both Africa and
India agree to take further measures to continue to create a positive ambience
for such enhanced flows. Africa has also effectively utilized concessional
financial flows from India to Africa for supporting the development of its
infrastructure industry and services. Both sides agree to further expand
cooperation and sharing of experiences to increase trade, investment and
financial flows between India and Africa as they provide a common paradigm
of cooperation in the true spirit of South–South engagement.
132 Geopolitics and Asian donors
At the India–Africa Forum (2011) emphasis was placed on capacity and value
added through South–South partnership and an Action Plan for the Framework
of Cooperation. Special care would be taken to encourage greater investment in
some of these sectors as well as to increase financial flows from the government
sector to achieve these objectives. India is committed to continue with increasing
numbers of scholarships in specialised areas like agriculture, science and
technology. Moreover, Japan’s increasing willingness to engage in collaborative
projects with India and share its expertise, can also make use of earlier Indian
access to other African nations and as a counter to China’s influence. Japan is also
able to counter accusations of its imperial past by maintaining its relations and
cooperating with the historically anti-colonial Indian state.
In this sense China and South Korea’s questioning of the ‘rise of Japan’ and
Japan’s colonial legacy can paradoxically benefit Japan, pointing out that other
states ‘have moved on’ and are more interested in technological power (a lack
of which is one reason why these states were subject to colonialism in the first
place) and no longer taking the bait of other Asian donors in framing Japan as an
‘imperial power in waiting’. In this sense Japan has aimed to separate its history
and politics from the economic and technical side of its ODA (JICA 2002, 2009b;
Na 2009). Yet this separation (and the soft power promotion of this separation)
can also counter-productively indicate a historical sensitivity which continues
to influence, directly or indirectly, domestic and international attitudes toward
Japan, particularly in the Asian region.
The perception of Japan as the ‘anti-European colonial’ hero followed the
defeat of imperial Russia during the Russian–Japanese War of 1904/1905. The
Japanese victory was the first instance of an Asian power defeating an imperial
European power. For many this victory was a watershed and defined the end
of the age of European colonialism; the Russian defeat created the conditions
for the communist revolution of 1917, which of course in turn then inspired the
communists in China. Through its ‘Great Asia Project’ Japan had defended its
regional expansionism on the basis that it was ‘liberating’ and uniting Asians from
European repression and ‘divide and rule’. In this respect imperial Japan was
promoting itself as different regional power. This is a familiar language, of course,
of all past and present major regional and global hegemons. Japan now promotes
its historical anti-colonial role in rebuking Italian interventionism in North and
East Africa during the 1930s with East African countries. Japan was regarded as
an ally of the Ethiopian Emperor with suggestions of there being a potential royal
marriage between the two nations (Bradshaw and Ransdell 2011). This ‘hero of
the south’ anti-imperialist mantle is now being used by China (Drifte 2006; Jain
2004).
In the post-war era, Japan’s Yoshida and Fukuda (1977) doctrines emphasised
Japan’s role in latest technology innovation and economic efficiency, so as not to
produce any backlash against or reminder of its war record (Edstrom 2003, 2004).
Japan, however, has also emphasised ‘heart to heart’ links with ASEAN and its
‘natural’ anti-colonial alliance with India (JICA 2012b). In the post-Cold War era,
Japan then began its competition for influence in Africa with the rise of China
Geopolitics and Asian donors 133
and an emergent South Korea. At the same time Japan has now shifted away from
resource extraction, just as China has started its resource extraction. However,
Japan has traditionally prioritised Asia in its ODA Charter, stating an intention to
enhance South–South cooperation with the ‘more advanced developing countries’
in Asia (MoFA 2003b). China is also often regarded as having its own interpretation
of South–South as a ‘third world hero’ but a part of the UN system. However this
approach is also different to the UN’s version of South–South relations as being
an inclusive part of North–South relations or as a supplementary to these relations
(Nairobi 2010).
Japan
Japan is using ‘physical geography’ and ‘climate change’ empathy, through
its ‘disaster management’, to gain leverage with Indian Ocean coastal African
nations, particularly since the Tsunami of 2004, as well as India and Pakistan
(MoFA 2009, 2011a, 2011b; Varma 2009). Japan has been promoting itself with
African coastal states and island states, and as a long-standing maritime nation,
unlike the continental states of China and South Korea. Japan also promotes a
mutual understanding between donor and recipient in terms of the impact of
climate change and impact of natural disasters such as tsunamis (Indian Ocean
and East Africa experiences of Somalia, Mauritius and Tanzania in 2004) and
earthquakes. Buckley (2013) noted that China has a clear experience in sectors
such as agriculture and food security, given that it can feed 20 per cent of the
world’s population and with only 9 per cent of the world’s land.
The 2000 Beijing (2000) Declaration and the Programme for China–Africa
Cooperation in Economic and Social Development both stated that ‘further China–
Africa co-operation in the economic, trade, financial, agricultural, medical care and
public health, scientific and technological, cultural, educational, human resources
development … and other areas … so as to promote the common development
of China and Africa’. The 2000 Beijing Summit also laid a foundation for the
all-around, sustainable development of China–Africa relations. China provided
African countries with US$3 billion in concessional loans and US$2 billion in
preferential export buyer’s credit. The China–Africa Development Fund invested
US$500 million in 27 projects. China has also cancelled 154 debts owed by 33
African countries, and increased the number of export items to China enjoying
zero-tariff treatment from the least developed countries in Africa.
Conclusion
With geopolitical competition in Asia as a result of the rise of China, the role of
the US and responses from South Korea and Japan, this competition is manifested
in the different ways in which the Asian donors are operating in Africa. ODA is
promoted through a myriad of state-led narratives claiming historical and anti-
colonial ‘shared experience’. In some recipient states Asian donors are directly
competing, in others donors are willing to allow their competitors to use resources
without competition as a ‘winner takes all’. The role of East Africa however is
becoming increasingly significant for all leading Asian donors. This chapter has
discussed the history and geopolitics of the three main East Asian foreign aid
donors and indicated where, why and how these geopolitics are manifested in
aid to Africa. The chapter has compared and contrasted a variety of Asian ODA
policies evolving from China, South Korea and Japan, all leading Asian states
in the ODA debate, contrasted by their different histories, and international
strategic positions (China as a rising BRIC, South Korea as the newest OECD-
DAC member and former recipient and middle power, Japan as an established
aid donor). The chapter has therefore highlighted how regional geopolitics and
tensions in Asia can impact on the patterns of Asian donor interest in Africa and
the distribution, form and content of Asian ODA.
Notes
1 The Chinese government stated in its 2011 White Paper that financial resources
provided by China for foreign aid mainly fall into three types: grants (aid gratis),
interest-free loans and concessional loans. The first two come from China’s state
finances, while concessional loans are provided by the Export–Import Bank of China as
designated by the Chinese government. Firstly, grants are mainly used to help recipient
countries to build hospitals, schools and low-cost houses, and support well-digging
or water-supply projects, and other medium and small projects for social welfare.
Secondly, interest-free loans are mainly used to help recipient countries to construct
public facilities and launch projects to improve people’s livelihood. The tenure of
such loans is usually 20 years, including five years of use, five years of grace and ten
years of repayment. Currently, interest-free loans are mainly provided to developing
countries with relatively good economic conditions. Thirdly, concessional loans are
mainly used to help recipient countries to undertake productive projects generating
both economic and social benefits and large and medium-sized infrastructure projects,
or to provide complete plant, mechanical and electrical products, technical services
Geopolitics and Asian donors 143
and other materials. Concessional loans are raised by the Export–Import Bank of
China on the market, and since the loan interest is lower than the benchmark interest
of the People’s Bank of China, the difference is made up by the State as financial
subsidies. The annual interest rate of China’s concessional loans is between 2 and
3%, and the period of repayment is usually 15 to 20 years (including five to seven
years of grace). 61% of concessional loans are used to help developing countries to
construct transportation, communications and electricity infrastructure, and 8.9% are
used to support the development of energy and resources such as oil and minerals
(GOC 2011).
2 The captain of the South Korean vessel (the Samho Jewelry) which was attacked
on 1 January 2011 by a Somali pirate vessel, was flown back to my University’s
Hospital Complex in Suwon, South Korea. The President later visited. The subsequent
Diplomatic White Paper highlgihted the incident as an example of the ability of ‘Global’
Korea to rapidly deploy its troops to secure its transport routes (MOFAT 2012: Chapter
Six). Photos of the President and Captain were soon adorning the hospital corridor. A
somewhat surprising national pride was also shown by some onlookers that the Somali
pirates who had been brought back to South Korea to face the legal process, were also
said to be particularly enjoying Korean food and Korean hospitality.
3 ‘Chinese flee Ghana gold crackdown’ The Japan Times 27 July www.japantimes.co.jp/
news/2013/07/21/business/chinese-flee-ghana-gold-crackdown/#.Ugeih86wf4Y
4 ‘Ghana and Korea Sign 122.7 million dollar agreements’ Ghana News Agency www.
ghananewsagency.org/economics/ghana-and-korea-sign-122-7-million-dollars-
agreements-42821
5 A doctrine initiated from West Germany (FRG) during the Cold War, that any country
that recognised East Germany (GDR) would not be recognised by the West German
government in Bonn.
6 Interview KOICA representative, Suwon, March 2012.
7 This also impacts on Ethiopian asylum-seekers and African migrants requesting leave
of stay in South Korea.
8 There have been critiques that this analysis is inherently tautological as expansive
powers are by definition geographically diverse. There is also the issue as to
whether the hyperpowers become intolerant and xenophobic exactly because they
are declining, rather than this intolerance being a cause of the decline. Nonetheless
Chua makes the point about relativism with a nice anecdote: ‘Two climbers are on a
mountain. An angry bear comes running towards them. One climber starts putting on
his running shoes. “You’ll never out-run the bear” his friend exclaims. “No I won’t”
his friend replies, “but I will out-run you.” www.youtube.com/watch?v=bCDwa_
hH2o8&list=PL81DA6B486E27527C
9 Interview, Suwon, October 2013.
10 ‘Forum On China–Africa Cooperation 18 July 2012’ www.focac.org/eng/dwjbzjjhys/
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Foreign Assistance’ Convention 26 May.
11 ‘Japan pledges $32 billion aid to Africa’ The Korea Herald 3 June www.koreaherald.
com/view.php?ud=20130601000070
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eml-alt-mip-mck-oth-1311
4 Asian ODA
Assessing emerging donors in the
Asian region
Introduction
The current geopolitics in Asia is being defined directly and indirectly by the cool
war between the US and China. The region also includes a number of BRICs
and Next-11 countries which are juxtaposed (or superimposed) within and upon
regional geopolitical and geoeconomic dynamics. The three leading Asian donors
established the Asian Development Forum in 2010. This also includes India and
Thailand (Kitano 2012). This chapter considers the current patterns of Asian ODA
and how leading Asian donors are justifying and promoting ODA to the Asian
region. For Feeny and Clarke (2008: 198) the Asia-Pacific region ‘is often said to
be making good progress towards the Millennium Development Goals (MDGs)’
but ‘the region is extremely diverse and analysis at the regional level masks
significant differences in the progress towards the MDGs made by individual
countries’. They also argued that the MDGs have been criticised for being both
too ambitious and not ambitious enough, often masking reality by relying too
much on ‘averages’ and on quantitative rather than qualitative indicators.
The MDG yardsticks, they argued, were too narrowly defined. There was
also a flawed logic with MDG data collection given that in the poorest and most
marginalised areas, by definition, it would be difficult to get access to regular
and routinely quantifiable data. The recent keynote speech made at the first
Asian Development Cooperation Meeting (ADCF) (2010) argued that Asian
countries need to formulate new strategies to maintain growth momentum in ‘our
economies’. For instance, the smaller Pacific islands are now a relatively large
recipient of OECD-DAC aid and becoming increasingly significant strategic
‘outposts’. JICA-KOICA (2010) also noted that their ODA is similarly ‘grounded
in Asia’s own development experience’ and that ‘it is shaped by the concept of
mutual benefit’ which is now transforming the global development landscape
(JICA 2013).1
The chapter considers the role and approach of Asian donors in the Asian
region and discusses the reasons for the particular forms of distribution and aid
type from Asian donors. These reasons can be linked to the regional geopolitical
dynamics between the donors across the region. The chapter considers the way in
which the Asian donors ‘sell’ their ODA to Asian recipients in the region.
Asian ODA 153
Distribution of Asian ODA
Table 4.1 gives a list of leading donors for each specific state in the Asian region
in 2010.
The top ODA recipients from the DAC (and non-DAC donors) in the Asian
region were reported by the OECD (2013) to be as given in Table 4.2.
As a BRIC nation, India still receives aid, along with its neighbour Pakistan.
As a new OECD-DAC member, South Korea has tended to follow DAC
distribution norms with recipients in Jordan and the West Bank/Gaza. South
Korea has also increased its aid to Nepal, a country sandwiched between China
and India, and a ‘shared experience’ country geographically and ideologically
caught, like South Korea, between two or three regional superpowers. In 2011,
the top donor bilateral net disbursements to Asian recipients were recorded as
given in Table 4.3.
Table 4.3 indicates how the US (and US allies) as Asian donors are particularly
proactive in the Asian region. It is in the Asian region where the leading Asian
donors also tend toward a focus on humanitarian and ‘natural disaster’ management
aid. Saudi Arabia is high on the list linking to oil resources with China. In this
respect the OECD defines and demarcates the region as East Asia, South Asia and
West Asia.
The shared Asian regional experience of the 1997–1998 Asian financial
crisis and its subsequent ‘contagion’ has led, over the last few years, to Asian
donor states selling their ODA to neighbourhood recipients through the ‘shared
experience’ of the crisis. This is usually through a narrative of shared empathy
in that the donors also experienced the ‘fall out’ of the crisis and the subsequent
humiliation of Western institutional conditions and bail outs. Yet many of the
South Asian ‘Tiger’ economies had their early shoots of development before
the 1997 financial crash being compromised by Chinese low wage export
competition. However, China and Japan played a major role in providing
assistance to these countries. During the 1997 crisis the Malaysian government,
for instance, had decided against borrowing more money from the International
Monetary Fund (IMF). The Japanese government had also grown increasingly
dissatisfied with the IMF’s programmes and had stepped in with their own
financial packages and programmes. Moreover, there are also geopolitical
obligations for both Japan and South Korea as both countries are the regional
allies of the US. Both countries increased their ODA commitments to ongoing
reconstruction efforts in Iraq and Afghanistan between 2003 and 2009. In the
Asian region, only Myanmar, Cambodia and Laos received an increase in ODA
from Japan in 2010, whilst the Philippines and Thailand recorded the largest
reductions in Japanese ODA (MoFA 2011a, 2011c). Such patterns reflect the
link between domestic economic policy and the resources used for ODA. In this
respect Japan has taken a ‘strategic’ approach to promoting ‘smart aid’ and yet
this focus, as I will argue, also reflects distinctive geopolitical shifts particularly
in South Asia.
Table 4.1 Leading donors to Asian states (2010)
Malaysia US, Germany, Denmark, Australia, South Korea
Uzbekistan South Korea, Germany, US, Japan
Turkmenistan US, Germany, South Korea, Norway
Myanmar Japan, Australia, UK, US, Norway
Kazakhstan US, Germany, Norway, France, South Korea
Philippines France, US, Australia, South Korea, Spain
Sri Lanka Japan, Australia, France, South Korea, Norway
Thailand US, Australia, Sweden, UK, South Korea
Cambodia Japan, US, Australia, Germany, South Korea
Pakistan US, UK, Japan, Germany, Australia
Vietnam Japan, France, Australia, Germany, South Korea
Laos Japan, Australia, South Korea, Germany, Switzerland
Nepal UK, Japan, USA, Norway, Germany
Bangladesh UK, US, Canada, Denmark, Holland
Bhutan Japan, Denmark, Australia, Austria, Holland
India Japan, UK, Germany, US, Norway
Table 4.2 Top ODA recipients in 2011 in Table 4.3 Top ten net bilateral donor
$million disbursements to Asia 2010–2011
Afghanistan 6711 US 8359
Vietnam 3514 Saudi Arabia 4575
Pakistan 3509 Germany 2962
India 3220 EU 2597
West Bank and Gaza 2444 Japan 2432
Iraq 1904 UK 2147
Bangladesh 1498 IDA 1828
Jordan 959 Australia 1664
Nepal 892 France 1039
Cambodia 792 Canada 948
Source: OECD 2013: 7. Source: OECD 2013: 4.
Asian ODA 155
From Asian crisis to ‘shared experience’ ODA
Japan is currently reassessing its own domestic economic policy and there
has been a wider ranging move toward a more Keynesian pump-priming
policy (‘Abenomics’) to stimulate the economy and to depreciate the value
of the Japanese yen, to make Japanese exports more competitive. In Asian
developmentalist states these debates have often polarised as to whether to ‘push
on’ with neoliberal reform (and gain credibility for austerity toughness) or to
construct a more ‘neo-developmentalist’ strategy. Moreover, there is debate as to
whether free trade necessarily means ‘neoliberalism’ and whether neoliberalism
necessarily means a Western-centric or a top-down ‘one size fits all’ approach.
In South Korea, the debate has swung as to whether the original economic crisis
of 1997 was due to the regulating inefficiencies of the developmentalist state/
big businesses relationship in the age of globalisation (the liberal argument), or
that neoliberal ‘deregulating’ reform had happened too quickly for the existing
institutional capacity (Conservative) or that neoliberalism hadn’t been enforced
quickly enough (liberal argument).
As a result of the crisis, the Conservatives in South Korea then began to
split between a developmentalist and pro-US free trade model of globalisation
(President Lee), and those Conservatives making the case for a classic
conservative ‘economic democratisation’ with emphasis on small businesses (a
creative economy for the ‘second miracle on the Han’). Such domestic tensions
also reflect South Korea’s domestic middle power credibility in ‘exporting’ its
model of ODA which is often promoted in rather nostalgic terms for the model
of ‘developmentalism’. The problem for donors is that many recipient countries
are ‘leapfrogging’ the traditional developmentalism models of the 1970s. Clearly
these domestic dynamics and economic sustainability issues both directly and
indirectly impact on the resources actually made available for ODA, as well as
having an impact on public support for ODA policies.
The first signs of the Asian crisis occurred in May 1997 when the Thai baht was
devalued by the government in Bangkok and a domino of currency devaluations
occurred across the region, leading to high import costs, inflation and investor
outflows. For some, the roots of the crisis could be tracked back to two countries
who later tried to ‘solve’ and ‘aid’ those countries in economic difficulties. China
had begun its meteoric rise but had maintained a relatively high exchange rate so
as not to spark a round of regional currency devaluations and export competition.
This currency level could be absorbed by a pool of cheap Chinese labour and high
demand for exports. Nevertheless, a cheap priced export sector also dealt serious
competition to other Asian states which began undermining other Asian drivers’
comparative advantage.
Moreover, Japan, as a result of its deal with the US (the 1985 Plaza Accords)
had agreed to allow the yen to float upwards, thus aiding the US trade deficit, but
as a result (and in order to remain competitive), led Japanese investment to pour
into South Asia to take advantage of cheaper labour and production costs (Bello
1999). In this sense growing regional interdependence was occurring as production
156 Asian ODA
shifted from country to country. The regional process in Asia (paradoxically given
the domestic organisation of political institutions) is increasingly decentralised
and network orientated.
During the early to mid-1990s therefore, the emerging Asian driver countries
and several ASEAN nations (Thailand and Indonesia in particular) had now
begun to base their future economic growth on being able to attract more foreign
investment and maintain low costs, and had agreed to fix their domestic exchange
rates to the US dollar so as to create further confidence for foreigners who wished
to invest in these emerging Asian nations. This strategy also needed a constant
flow of foreign currency reserves which came from export growth.
During the mid to late 1990s, US interest rates then began to rise, partly as a
result of the US Federal Reserve’s attack on domestic US inflation. As a result,
so-called ‘hot money’ began to flow out of Asia’s emerging economies and back
to the US. Similar concerns now exist with regard to a possible future ‘tapering’
of US Federal Reserve bond buying or so-called ‘quantitative easing’ which could
lead to a subsequent interest rate rise in the US and would mean that money might
again flow out of the emerging markets back to the US. However, the mid-1990s
was a time where many Asian governments had already leveraged their present
and future development (and borrowing) on assumed future asset price rises.
Indeed most foreign money had gone into speculative real estate construction
rather than economy ‘fundamentals’. Thus, investor outflows from Asia caused
an exponential panic in this sector, and asset prices began falling. With collapsing
real estate prices, continued exports were expected to be the saviour and to bolster
investor confidence. However, the domestic exchange rates were still fixed high
to the dollar given that there was ongoing competition from China. This meant
that export prices were being undercut and that exchange rates were not being
allowed to respond in tandem to a relative fall in demand for exports. There were
also more structural issues emerging of limited productivity and labour pressure
for higher wages as many countries now hit the ‘Lewis turning point’ and cheap
pools of labour began to dry up. This process further squeezed export profits and a
rising middle class were now also buying the latest and relatively cheaper foreign
imports. This was making it difficult for domestic businesses to survive and
pressure began to build on governments for labour rights and human rights issues.
A fall in demand for Asian exports should, in a flexible exchange rate system, have
been expected to have ‘naturally’ led to a readjustment of the exchange rate and
offset such concerns. However the underlying depreciation of the currency was
occurring within a fixed exchange rate system. This meant a further speculative run
on the currency and a selling of local currencies as investors started to panic and
‘cut losses’. This led to the further selling of the local domestic currency, a further
currency depreciation, which meant that the domestic currency now flooded the
domestic economy. This began to create domestic inflationary tendencies and a
spiral of higher labour wage demands.
The constant difficulty for governments was in deciding whether the unfolding
events reflected the need for a technical market or currency readjustment, or
whether the processes represented a structural deficiency requiring costly and
Asian ODA 157
painful ‘shock therapy’. For many governments, the latter would mean major
social unrest and a loss of government legitimacy, particularly with the increasing
leverage of the new middle classes. as well as the dangers of further capital
flight. Alternatively, a ‘wait and see’ approach may miss a costly yet effective
opportunity to pre-emptively solve a potential future crisis. It is no wonder that
governments come to rely more and more on immediate economic statistics and
the constant mining of ‘big data’ to gauge even the slightest hint of relief in the
markets. It is a difficulty for governments to maintain a perception of ‘stability’
in an era when economic data models clash with the ‘reality of perceptions’ and
pre-emptive decisions create self-fulfilling prophecies.
With fears from investors of an overvalued domestic exchange rate, many
investors had also gambled that a currency devaluation by the governments would
be unlikely, as this would disrupt all remaining confidence in the government
and would cause unprecedented economic meltdown and social and political
challenges to the incumbent leaders. Thus domestic exchange rates across Asia
still remained pegged to the dollar to maintain investor confidence but this policy
now required stabilising through massive government support and a greater
spending of government foreign reserves. However, the more governments tried
to stabilise the currency, the more this caused speculation as investors pulled out
for damage limitation. However with relative demand for exports still falling,
foreign currency reserves were also falling and could not be used to support the
domestic exchange rates. Governments now began to borrow heavily in order to
support their domestic currencies. This created an increasingly high debt/Gross
Domestic Product (GDP) ratio which generated fear amongst investors of future
tax hikes.
Governments also put up higher domestic interest rates in order to keep the
currency pegged to the dollar and to attract back the investors. Whilst this may
have quelled inflation concerns, the policy ended up further reducing domestic
consumption. For many governments, the options were to still keep going with
this pegging in order to keep confidence in the economy (but with losses and
debt and future credit rating concerns) or to change policy direction (which
would have created further capital flight and a credibility issue for future FDI
and credit ratings). Paul Krugman (1994) distinguished between ‘the paper tiger’
economies which later collapsed, and the larger countries such as China. For
Krugman (1994), writing before the 1997 crisis, it would be China in his view
that would still have a medium term demographic dividend to become a major
economic power, even with a fraction of total productivity gains (Krugman 1995,
2012, 2013a, 2013b). Yet emerging middle income economies which have been
based on the export-led model can also generate the law of diminishing returns,
meaning that increasing GDP at higher rates each year in fact wears out the
resources for long-term sustainability. Krugman’s point has entered a new era
with a projected dip in population and a rise in the number of single Chinese men
unable to start a family due to skewed gender dynamics and rising costs of living.
This demographic has historically been politically active if raised expectations
are not being met. Chinese property markets are also inflated as a result of an
158 Asian ODA
increase in single males buying apartments for wanting the security of starting
a family.
The great paradox of the 21st century is that while global power is more
diffuse, the challenges that we are facing will require greater co-operation
than ever before. Climate change, resource security, nuclear non-proliferation
and terrorism all reflect this common reality. New ways of co-operation
will need to be deployed if we are going to be able to rise to these global
challenges. We cannot just rely on super powers. As Secretary Clinton herself
has stated, the United States does not and should not ‘go it alone’. Rather,
the US is looking to exercise leadership in new ways – to connect and create
partnerships that have the capacity to solve shared global problems. It is in
this way that I believe creative middle powers are well placed in bringing
together major, regional and small powers to shape and implement solutions.
India too is firmly on the rapid path to big economy status; Japan’s economy
remains the world’s third largest; Korea and Australia are major economies,
and Indonesia, Vietnam and others in East Asia are growing fast.
160 Asian ODA
The top ten donors to Asia in terms of their percentage of total ODA were
as given in Table 4.4. The data indicate a relatively high level of Asian to Asian
donor–recipient relationships. South Korea has a relatively higher percentage than
Japan as a result of Japan’s more established global network. These donor to donor
and donor–recipient relationships are now occurring in, and reflecting, what many
regard as an age of inter-state multipolarity. The term multipolarity is intrinsically
culturally biased and as a result subject to a variety of interpretations, justifications
of policy and usages. The Chinese term ‘duojihua’ has often been translated as
multipolarism and was used to describe a specific period of globalism and as both
a descriptive ‘is’ and a more instrumental ‘should be’ concept (Womack 2004:
354). The five states (or alliance of states) that are currently being treated as a
part of this multipolarity by China, are the US, Russia, China, Japan and Europe
(EU). Womack (2004: 355) has noted, however, that other countries, also ‘prefer
a scheme of poles that included their own country as a pole and then closed the
door to the pole club just behind themselves’.
According to Gallagher (2011), China is now regarded by these other states as
the ‘motor of the world economy’, promoting its Beijing version of globalisation.
This is prompting interest from the other Asian donors, fearful of China’s rise, in
widening East Asia to the Asia-Pacific and to include West Coast Latin American
aid recipients such as Chile and the CIVET countries such as Colombia. Indeed,
South Korea recently increased its aid to Colombia and justified this to the
South Korean public by using the argument that Colombia had provided military
assistance to South Korea during the Korean War. The paying back of ‘debts’ is
promoted not as a gift but rather as an act of delayed obligation and gratitude.
This is projected with the intended meaning that the former aid recipient has now
developed and ‘made it’. This is a Confucian exchange narrative of reciprocity
being based on a ‘required remembrance of obligation’ and also implies that the
donor’s subsequent development was, in part, based on a multi-decadal obligation
‘to want to pay back debt’. Indeed this particular cultural form of ‘from recipient
to donor’ narrative also plays a part in a country’s national aid autobiography.
These national identity shifts are, in turn, opening up further questions of what
counts as (and who determines) Asian and Asia-Pacific identity (Kang 2012;
Park 2013). This question of Asian identity and Asian perspectives as ‘common
identity’ has also included the cross-cultural links and connections with other
regional organisations, particularly with regard to the littoral Indian Ocean states
(IOC-ARC 2013).
there have been various cycles of ASEAN anti-Americanism and ASEAN anti-
communism. ASEAN countries have a common factor with China in terms of
the respect for national sovereignty and non-interference. Of course the question
as to what criteria are used in order to distinguish between intervention and non-
intervention remains controversial at best, as does the question that a mutual
‘respect’ does not necessarily mean mutual equality. In the same way, the idea
of mutual benefit or ‘win-win’ does not always attend to the question of who
defines ‘benefit’ and what is the criteria of determining the ‘win’, that is, whether
‘winning’ necessarily means that both sides start from level playing fields,
particularly if winning also implies a ‘take it all’ or ‘first past the post’ approach.
Whether ASEAN as a regional bloc and institution has its own internal
evolving and particular regional common identity (more than the sum of the parts)
or whether influential emerging-power states within ASEAN now aim to utilise
the ASEAN platform for proving their leadership experience and promoting their
own global interests and agenda, is a constant theme. ASEAN is often portrayed
as having a ‘single voice’ but as a regional platform is clearly distinguished by
including states at very different levels of national interests, development and
geography.
With Chinese concerns over what Beijing sees as US encirclement in the
region, there is growing Chinese influence over ASEAN countries. However
the ASEAN is also being used by Japan and India to forge an alliance through
which to contain or counter the rise of China. Japan and India have also recently
accelerated their own development cooperation (JICA 2012c; MoFA 2011a,
2011c). Many maritime ASEAN countries such as Indonesia and the Philippines
have themselves been increasingly concerned with the military power of China
in the region (particularly over the South China Sea) and have, as a result, aimed
to consolidate their ties with the US and Japan. On the other hand, continental
ASEAN nations such as Cambodia and Laos have received increasing amounts
162 Asian ODA
of Chinese support as China has implied that there is a geopolitical threat from
a hegemonic Vietnam. This is used as a useful leverage for China’s continuing
interest in the region. Such splits within ASEAN were evident in the now
‘infamous’ lack of a 2012 ASEAN final communiqué. Nonetheless, ASEAN has
now encouraged Japan, India, Australia and New Zealand to partake more fully in
the institutional process. However, ASEAN countries have been unable to produce
a unified stance on several issues such as ongoing South China Sea sovereignty
matters. Laos, Cambodia, Myanmar and Thailand have been more welcome to
China’s increasing economic and political presence and aid in the region as these
countries are within China’s continental orbit (Shekhar 2012). Both Vietnam and
Cambodia also recognise that tensions in the region between the major powers
might mean an increased leverage as these countries become ‘bridges’. At ASEAN
2010 the Philippines insisted that the communiqué should reflect the growing
confrontation between the Philippines and China concerning the sovereignty
over the ‘Scarborough shoal’. Vietnam had wanted the declaration to address the
ownership of exclusive economic zones (EEZs). Myanmar, Malaysia and Laos
will each chair ASEAN over the next few years. For each recipient country, the
donor has a particular way of addressing its geopolitical relations and what it can
offer through its ODA. ODA is justified through state-led narratives on ‘shared
experience’ and ‘authentic’ and equal historical ties. For instance, Japan’s 2012
ODA White Paper in a section entitled ‘Building Up Trust in Japan’ stated:
However, even after the deadline for achieving MDGs comes in 2015, there
will still be various issues. Now we face the question of what should be done
about development goals beyond 2015 (post-2015 development agenda). The
aim should be poverty eradication through high-quality economic growth,
and the post-2015 development agenda needs to be a framework for forging
partnership among various stakeholders who support each other, based on the
concepts of equity and human security. Based on the experience of providing
assistance and the results of development so far, Japan will further accelerate
its efforts towards achieving the MDGs, as well as continue to proactively
contribute to the discussions on the post-2015 development agenda.
(JICA 2012a)
The Vietnamese side affirmed that the Government and people of Viet Nam
always remember and are sincerely thankful to Japan for its contribution to
Viet Nam’s economic and social development as the largest donor country
in Official Development Assistance (ODA) to Viet Nam, and welcomed the
fact that the volume of Japan’s ODA to Viet Nam reached one hundred and
fifty-five billion yen in the fiscal year 2009, the highest level to date. Prime
Minister Nguyen Tan Dung appreciated the progress on Japan’s assistance
Asian ODA 165
to Viet Nam’s priority infrastructure projects such as the North South
expressways, Hoa Lac High-Tech Park, and the feasibility studies for the two
sections of the high-speed railway: Ho Chi Minh-Nha Trang and Ha Noi-
Vinh. The Vietnamese side also explained the importance of the Da Nang–
Quang Ngai expressway and upgrading of Ha Noi–Noi Bai railway and drew
the attention of the Japanese side to these projects.
Japan’s relations with the Mekong region countries within ASEAN have
become increasingly cordial. Vietnam has given its support for Japan to
become a permanent member of the UN Security Council. The development of
infrastructure in the Mekong area is a strategic key for all donors, both to gain
access to areas for resources and for building projects, as well as for creating a
sense of ‘connectivity as identity’. The form and content of this identity clearly
depends on a donor state’s ability to project its ‘soft power’. A lot of this soft
power comes from direct human resource activity and volunteers on cultural
exchanges. Japanese ODA has often been used to provide the building of a
transportation network for the extraction of raw materials and products, and the
electrical power supply needed to coordinate this (Araki 2007; Kusano 2000).
Japan pursues an agenda of supporting democracy and national reconciliation in
the region. Moreover, promoting civil society and NGOs allows a greater cost-
effective participation of more actors for enhancing development cooperation,
and the kind of ‘inclusion’ that non-democratic donors are unable to access and,
as a result, may have greater costs in selling ‘soft power’. According to Section
Four of the 2012 Japanese ODA White Paper:
Many of the countries in the Mekong Region of the Mekong River Basin
(Cambodia, Laos, Myanmar, Thailand, and Viet Nam) have experienced
long periods of war and conflict. Even after the war in Viet Nam that lasted
for more than 30 years until 1975, tragic massacres under the rule of Pol
Pot continued in Cambodia … During this time, the Japanese government
consistently contributed to stability and development in the Mekong region,
treating it as a pillar of Asian diplomacy. The countries in the Mekong region
have all traditionally been pro-Japanese and possess a wealth of natural
resources and workforces. Japanese companies have a particularly high
level of interest in the region … Mekong region countries are landlocked
with adjacent national borders. There are vast inland areas that remain
undeveloped. In other words, intra-regional cooperation for development
in areas, such as infrastructure development and resource development, is
indispensable.
(JICA 2012a)
Japan is pushing to further entice coastal and maritime aid recipients away
from Beijing, in China’s ‘heartland’ in southern Asia. Japan is also making the
case that it was not in the region to cause ideological combat, but was there
to provide peace and stability. Japan is also using the historical argument
166 Asian ODA
of ‘traditional’ assistance through OECD-DAC and technical rather than
ideological experience. Indeed Japan’s role in the OECD-DAC is also useful
for donor states wishing to become a future member. The government White
Paper continued:
Japan announced in 2012 that it would provide 600 billion yen of its ODA
to Mekong countries over a three-year period. Japan also adopted the Mekong–
Japan Action Plan which contains specific actions and measures to realise the
Tokyo Strategy. In October 2010, ASEAN adopted the Master Plan on ASEAN
Connectivity, aiming at intensifying physical and geographical connectivity,
institutional connectivity and people-to-people connectivity in the region. At
the ASEAN–Japan Summit in November 2011, Japan announced projects for
enhancing ASEAN connectivity by utilising public funds from ODA and the
Japan Bank for International Cooperation with consideration given to ways of
mobilising private-sector funds. Moreover, Japan has also been contributing to
peace-building efforts in the Philippines, and assistance for nation-building in
Timor-Leste (JICA 2012c). In this respect Japan is content to be directly and
explicitly involved on issues of secessionism of which China is nervous. Varma
(2009) noted that China is aiming for more direct influence over regional allies
and regards ASEAN as a counter-balancer to growing India–Japan cooperation.
According to JICA’s 2012 Annual Report, Japan counts South East Asia as ASEAN
countries and Timor-Leste, and is aiming to decrease the divergences within this
group (JICA 2012b: 22). In terms of total Japanese ODA, Asia received 35.6 per
cent in technical cooperation, 81.1 per cent in concessional loans and 43.2 per
cent in grants.
Loans for this sector have meant that the donor can have more ownership and
leverage over the completed transport links. Grant aids were highest for public
works (64.2 per cent). The Annual Report pointed out that during 2007–2011
Japan helped to build 4,170 km of road infrastructure in recipient countries, which
is equivalent, the report said in its first few pages (and with connotations of Asian
connectivity), of a road between ‘Tokyo and Bangkok’.
Asian ODA 167
China, Japan and Cambodia
Approximately 1,250 miles of road and seven bridges have been built in
Cambodia with Chinese aid. Cambodia has also reiterated its diplomatic support
for the one–China policy. For critics of Beijing, the building of roads as specific
projects does not make for a national reconstruction project. Moreover, there
is little cooperation between Asian donors and therefore the construction (and
replication) of infrastructure projects are mainly to connect Cambodia and China,
making it easier to transport natural resources not only directly from Cambodia,
but also from ports on the Indian Ocean, particularly through and from Myanmar.
China is also using ASEAN Chairs such as Cambodia to cut short debates and
to filibuster on maritime issues, and to influence the actual setting of the agenda
in the organisation. In this sense China, like Japan, is using a more pragmatic
‘technical’ and win-win agenda to set an agenda that avoids uncomfortable
issues and accusations of colonialisms or neocolonialism. Chinese investment
in Cambodia has totalled $9.1 billion since 1994, including almost $1.2 billion
in 2011. This was eight times more than the US investment (Chul 2013). China
invested a total of US$9.17 billion between 1994 and 2012. Chinese investment
in the textiles industry has increased Cambodia’s exports and has created
employment for women in rural areas. Chinese investment in the energy sector,
particularly in hydropower development, has helped reduce energy shortages. By
2012, China was Cambodia’s second-largest donor after Japan. Japan is the top
Asian donor country to Cambodia, accounting for on average around 25 per cent
of all assistance to Cambodia. Japan’s officially stated policy has been to provide
assistance that contributes to Cambodia’s sustained economic growth and poverty
reduction, keeping in line with the Socio-Economic Development Plan (SEDPII)
and Cambodia’s Poverty Reduction Strategy Paper (PRSP). This is maintained
through closer consultations with the Cambodian government in policy dialogue
and other appropriate occasions.
For Japan, the economic development of Cambodia aims at the strengthening
of ASEAN integration (GOJ 2003). There are concerns that the government is at
risk of losing its autonomy and that its role in ASEAN might be marginalised if it
continues to put China ahead of ASEAN (Pheakdey 2013). The US has also been
critical of what it regards as China’s ‘vanity projects’ in Cambodia (Bangkok Post
2012).
China has generated criticism of Japan’s imperial role in the region and has
provided constant reminders of Cambodia’s own turbulent history under Japanese
rule. However China’s success depends on its uneasy relationships with present
Cambodians regarding previous support from Beijing for the communist and anti-
Vietnamese Khmer Rouge regime of the 1970s. The aim of China seems to be
to pull Cambodia out of what Beijing regards as the more pro-US Vietnamese
and Thai orbits, which are, for Beijing, also gravitating toward India. With
present history in the region constantly a part of national history and of revised
national identity, ODA is then placed in a positive or negative narrative as a form
of reparation or war compensation. Japanese ODA has tended to be focused on
168 Asian ODA
technical ‘win-win’ policies but this silence or exclusion of ‘the colonial era’ has
also led to a criticism of ‘ignoring’ the past, paradoxically by many right-wing
and nationalistic groups in other Asian donors countries. JICA and MoFA have
emphasised the growing importance of not just a rapid growth (with allusions to
China) but a growth in a more ‘balanced manner’ with proper legal reforms and
democratic governance, particularly in the capital Phnom Penh, at the gravitational
centre of the country. This is in contrast to China’s experience of unbalanced
development in the Eastern Coastal cities (JICA-Cambodia 2012, 2013). Japan
is promoting its ODA which focuses on peace-building and human security by
stating that the:
JICA’s 2009 Annual Report made the case that aid to Cambodia has gone to
‘main roads and harbours’ and focused on ‘hard and soft economic infrastructures’
(JICA 2009: 35). Japan uses the term ‘kingdom’ to infer a similar history with
Japan’s royal past. This implies that it was not only Japan that had royal or imperial
aspirations, and that China’s communist party also seems to be in an inconsistent
position through its support for a country with such a legacy. Similar forms
of ‘solidarity’ have been used in Japanese relations with Ethiopia. Cambodia
is regarded as a transit point among multiple economic corridors including
the Southern Economic Corridor, the Southern Coastal Corridor and Central
Corridor. The Southern Economic Corridor and the Southern Coastal Corridor
(specifically the route between Sihanoukville port and the Vietnam border) are
mainstays of economic activities and development. According to MoFA (2006b),
from 2000 and 2006, Japan’s concessional loans to Cambodia increased from
$1.53 million to $9.50 million, whilst its grant aid fell from $65.32 million to
$56.93 million. During the same period, Japan’s technical assistance remained
relatively constant from $32.35 million to $39.86 million. Japanese aid to China
during the same period saw a reduction of its concessional loans from $397.18
million to $231.51 million, and grants were down from $53.05 million to $19.05
Asian ODA 169
million. Japan’s technical assistance remained at generally the same level from
$318.96 to $318.84.
Myanmar has had mixed views about its shared colonial relationship with
India and the numbers of Indian workers who were brought to Myanmar under
British rule and stayed. It still looks to India for certain support, including
commercial support and (somewhat crudely) as a balance to China’s growing
stake in Myanmar. Overall, however, India makes a less-attractive market
for Myanmar’s business community, which sees China, Southeast Asia and
Japan and Korea as preferred opportunities.
China plans to transport crude oil across the Myanmar border and complete
an irrigation project in Myanmar. This North–South corridor route is in
contrast to Japan’s own current construction, through loans and grant aid,
of an East–West road corridor to connect Myanmar with Vietnam. China is
winning major contracts in Myanmar at the expense of companies from India
and other countries, but facing business resistance from western countries.
Such dynamics have also been apparent in countries in the region such as
Nepal where both China and India vie for domestic influence and where ethnic
conflict often becomes an instrument of ‘divide and rule’ from the powerful
neighbours, with their internal proxy support. With so much attention on the
nascent democratic shifts in Rangoon (Yangbon), many were also critical
of how the ethnic issues were often being marginalised by the leaders and
by elite-led discussions. China again finds itself involved in a country with
increasing rates of demands for secessionism or autonomy from ethnic
movements. Thus, the Chinese apparent lack of willingness to support or put
pressure on governments through its ‘no questions asked’ policy is not therefore
based simply on China’s alleged intentional or ‘immoral’ unwillingness to act
in a humanitarian way, but more that China doesn’t want to be seen to be
supporting a government which might have to grant some kind of autonomy
and political concessions to ethnic minorities in order to remain in power.
Work on a pipeline from Myanmar to China through sensitive ethnic areas has
been affected by armed clashes between Myanmar’s military and the Kachin
Independence Organisation in Kachin state. The major part of a 2,520 km long
trunk road that runs through China (of which 793 km are in Myanmar) is also
susceptible to such developments. Construction on the pipeline project (which
began in 2010) is also linked to an internal gas network to transfer the gas
170 Asian ODA
received at the border in northwest China to the East Coast cities. This is now
becoming a major industrial hub (Dasgupta 2013).
For China, a proposed Bangladesh–China–India–Myanmar economic
corridor could, it is suggested, change the geo-political map in Asia, whilst
China regards the ASEAN system as being representative of a return to the
idea of the form of historical tribute as well as a counter to the US and Japan
alliance (Hund 2003; Mansfield and Milner 1999). In 2010, China stated that it
will extend a $15 billion line of credit over the next three to five years to low
income ASEAN states in the region, and provide an additional $39.7 million for
Cambodia, Laos and Myanmar. China has also announced that it will donate $5
million to the China–ASEAN Cooperation Fund with an additional $900,000
to the APT+3 Cooperation Fund. Beijing has donated 300,000 tons of rice to an
emergency East Asia reserve fund to boost food security. China also proposed
a China–ASEAN scheme to create high-quality, high-yield crop demonstration
farms in ASEAN countries. China’s oil and gas imports still pass through the
Malacca Straits. Indonesia, the Philippines, Malaysia and Vietnam are uneasy
over Chinese intentions with the recent advances in its naval capabilities.
Maritime border nations such as Bangladesh now receive more assistance from
pro-US Asian donors as a buffer between Myanmar and India. South Korean
aid to Nepal suggests the importance that South Korea places on sharing its
experience on other geographic ‘bridge’ countries, with Nepal sandwiched
between India and China, and South Korea sandwiched between China and
Japan (Phadnis 2013).
For Japan, Myanmar is regarded as one of the last subregional frontiers
ready for opening up (Kent 2012). It was Japan in 1955 that first began giving
aid to Burma. Japan has been opening up projects in Myanmar again as one
of Prime Minister Abe’s first priority moves.2 Tokyo also wants to ensure that
Japanese firms gain future privileged access to resources and port access.
Myanmar is promoting democratic transition and opening-up and is expected
to be a new rising star. The US, the EU countries, Russia, India, Japan, South
Korea and China are competing to develop their own relations with Myanmar.
Japan resumed its economic assistance to Myanmar in January 2013 and began
waiving Myanmar’s debt in 2012 (JICA-Myanmar 2013). China still maintains
the largest investments in Myanmar and is still Myanmar’s biggest trading
partner. While China might not fear Japan strategically, there is a tactical issue
regarding new opening-up countries such as Myanmar (Qinrung 2013; Wassener
2013). Malaysia has a key strategic location on the major Indian Ocean sea
routes to Middle Eastern countries, from where Japan imports its petroleum and
Malaysia is also one of Japan’s major providers of essential natural resources.
The Malacca Straits still remain an important sea route for Japan but this area
is getting very crowded with competing Asian maritime and Asian continental
interests.
For South Korea and Japan there has been increased interest in the Northern
Arctic sea route. Japan also uses the 1997 crisis as soft power leverage and
‘shared experience’. One of the obvious difficulties with this sort of ‘solidarity’
Asian ODA 171
is that as each Asian donor ‘shares the experience and pain’ with recipients, each
donor is accelerating its own suffering to such a degree that it simultaneously
undermines its own development success and vulnerability. Japan also references
the 2008 Cyclone Nargis as a ‘shared experience’ with natural disasters and with
‘restorative development efforts’ (JICA 2009: 35).
Central Asia and Caucasus regions are politically and geographically important
areas that are surrounded by Russia, China, South Asia, the Middle East, and
Europe. The regions are also strategically important to Japan, with their large
abundance of energy and mineral resources such as oil, natural gas, uranium,
rare metals, etc. The stability and development of these regions impact on
Asian ODA 173
the Eurasia region as a whole including Japan. From this perspective, Japan
provides support for nation-building to establish long-term stability and
sustainable development in the regions, taking into consideration a broad
regional perspective which covers Afghanistan, Pakistan, and other regions
that border Central Asia.
China seems to be using a ‘wait and see’ approach before deciding what
form of assistance is to be provided to particular states (The Guardian 2013).
The Pakistan government is constantly caught in negotiating a difficult balance
between its high level strategic alliance with the US and the knowledge that this
alliance causes domestic threats to Pakistan’s legitimacy and instability. At the
same time the US recognises the need to give the Pakistan government a space
through which to handle the radical elements and ‘be seen to be tough on the
US’ for its own legitimacy, whilst also balancing domestic opinion concerns over
national security in the US and a worry that the Pakistan government is ‘using the
US’ and itself contains ‘radical elements’. A further dimension includes Pakistan–
Indian relations.
The assumption of strong emerging-power (BRIC) alliances between India
and China underestimates the geopolitical and geo-cultural tensions between
China and India as the competing regional powers over Pakistan and the
Central Asian region (Burke and Ahmed 2012). China recently built a Pakistan–
China Friendship Centre at the cost of an estimated $60 million, and included
banqueting halls and conference facilities as part of ‘high-level’ diplomacy
and by fusing Chinese and Pakistani Islamic styles. However the unintended
consequence has been to fuel local municipal concern with the maintenance
costs required to actually run it. The Chinese government regards Pakistan as
a key leverage ally with regard to India and the US, and Pakistan’s link with
Beijing’s Western provinces (The Guardian 2012). The US has recognised India
as being relatively less favourable toward the US and yet India remains in a
key alliance given the rise of China. Moreover, US–Pakistan relations are often
put under more stress at times of strengthening US–India relations. China’s
promotion of its historic ‘Islamic’ ties to Africa is in danger of awakening some
unrest in India. Japan argues that the BRIC relationship is artificial and that
Japan has much wider and more substantive historical interests with India.
However, with China increasingly giving more aid to Pakistan and social
infrastructure/humanitarian projects, this might be seen as a signal from Beijing
to New Delhi (as BRICS) that China’s relationship with India is strong enough
to cope with such tensions. Japan’s aid to Pakistan, for instance, is in line with
US demands for the sharing of responsibilities from its allies. However, this
aid would potentially undermine Japanese–India relationships, particularly if
India also becomes more sceptical with ongoing US interests in the increasingly
important Indian Ocean region.
Nonetheless, the level of bilateral Japanese ODA has generally fallen over
the last ten years. This is most obviously attributed to Japan’s own economic
difficulties during its so-called ‘lost decade’ (MoFA 2003; Potter 2012). Japanese
174 Asian ODA
ODA to India has become increasingly significant over the last few years,
particularly in terms of its technical cooperation in the Japan–India relationship.
The agenda on human security and disaster management has also been a key
aspect of Japanese ODA in South West Asia (OECD 2010a, 2011).
Southeast Asia is in many ways perhaps our most vibrant, our most
dynamic region in the EAP world, but frankly in the global context as
well. And in Southeast Asia, the U.S. has and continues to invest very
heavily in our relationship with the span of countries from the big ones to
the small ones, as well as with ASEAN. So if we take a look at it, if we
start at the very big end of the scale, there’s Indonesia. We have a thriving,
comprehensive partnership with Indonesia. Obviously, there’s a special
connection between President Obama and Indonesia, but we have built out
and are continuing to build jointly a comprehensive partnership that spans
a wide range of issues.
also mutually benefit from resulting regional stability. Japan–China relations have
shifted from one of mutual ‘good neighbours and friendship’ to a 1998 partnership
of ‘friendship and co-operation’ (MoFA 1998). South Korea in turn promotes
itself as a bridge, reflecting the experience of ‘shared colonialism’ and as an Asian
driver that is both a proactive and a non-threatening new middle power. The soft
power South Korean wave is also generated as an ‘attraction’ for workers. This is
leading to a number of developing country diasporas within South Korea. In 2009,
Joseph Nye (2009: 1) argued that:
South Korea has the resources to produce soft power, and its soft power is
not prisoner to the geographical limitations that have constrained its hard
power throughout its history … South Korea is beginning to design a foreign
policy that will allow it to play a larger role in the international institutions
and networks that will be essential to global governance.
South Korea ‘does not have the historical baggage that encumbers China
(feared for its power and size) or Japan (resented for its colonial and wartime
history)’ (Sook 2009, 2011). The South Korean government in its 2010 White
Paper (MOFAT 2010: 228) stressed, in a section entitled ‘Enhancing National
Prestige through Advanced Cultural Diplomacy’, that as:
Asian ODA 177
soft power is becoming increasingly important, culture has surfaced as an
indispensable element of a nation’s competitiveness and economic resource
that produces added value. To keep in pace with this changing global
environment, Korea has adopted cultural diplomacy as a new pillar of the
country’s diplomatic make up.
Like Japan, South Korea is also putting more emphasis on its ODA policies in
Laos.7 This is in the form of humanitarian aid, as well as educational provision
and an emphasis on KOICA volunteers and cultural student exchanges with
countries such as Indonesia.8 Yet at the same time, South Korea has its own
specific relationships with Laos through the prism of inter-Korean relations
and North Korean defectors. For instance, in May 2013 Laos sent back North
Korean defectors to North Korea (with alleged pressure from China), despite
a lot of domestic opposition in South Korea. A few weeks later South Korea
provided $4.3 million of aid to Laos, aiming to create a leverage over the Laotian
government with ODA averaging 4 billion won from 2009 (The Korea Herald
2013). The view in the US is that Washington does not place energy or resources
on prising Laos from China’s influence but the US, and allies in the region,
can provide Laos with some alternative options and channels for development
and growth through and within ASEAN which Laos joined in 1997. KOICA’s
approach to Laos is that:
Aid should be planned and implemented upon the needs of the local
community, not under the discretion of the donor state. … We have to blend
with the local community as we cannot procure all necessary material and
human resources from Korea. … Aid organisations are often blamed for
spending money, time and human resources on other states instead of on the
local low-income bracket. International aid, however, is not just a moral deed
but a crucial role for a country to play in the global society. We see ourselves
as salespersons for Korea, promoting its brand image and delivering its
culture to overseas countries.
(Bae 2012)
South Korean relations with Myanmar are often seen through the prism
of relations with the US and North Korea. In 1983, North Korean agents
detonated a bomb in Yangon that killed 21 people, including 17 visiting South
Korean government officials. North Korea also became an important military
ally of Myanmar during the 1990s. This has been a continuing issue for US–
South Korean relations aiming to put both hard power and soft power pressure
on Myanmar (Clinton 2012). With the new opening up of Myanmar, KOICA
aims to extend a grant aid in implementing national statistical system, social
infrastructure capacity building and a land reform programme for mechanised
farming and effective forest greening. Cambodia now receives the largest amount
in grant aid from South Korea after Afghanistan and KOICA (2010) operates
rehabilitation projects in the aftermath of the country’s war with the United States
178 Asian ODA
and its western allies. Since first launching grant programmes in Cambodia in
1999, KOICA has increased its grant assistance to the country every year to reach
a total of $17.8 million in grants as of 2012.
Another area of South Korean aid is channelled through elite-led and religious
based NGOs (World Vision) and the supplying by KOICA of volunteers to
Cambodia. One of the main issues in Cambodia remains the clearing of minefields
which were left over from the Khmer Rouge and the Vietnam/Cambodia conflict
of the 1980s. South Korea has also been involved in land mapping techniques
and monitoring in Cambodia to set up a regional ‘zip code’ (KOICA 2009: 64).
Asia is increasingly high on the South Korean agenda (ODA Korea 2011). One
view has been that all these inclusions could provide Seoul with huge leverage
and status both regionally and globally. But regional and global dynamics can
also work against each other. South Korea may want a strong ASEAN to counter
China and Japan. Yet the bridging role between the North East and ASEAN may
be potentially contradicted by South Korea’s increasingly multilateralist position
which would undermine its credibility with ASEAN, whilst not having enough
influence to continue as a strong voice in more globally orientated institutions.
There is growing competition from fast learner and fast follower states such as
Indonesia.
In this respect, South Korea’s high percentage of ODA to the Asian region
could be seen as a means of both balancing Japan’s influence and showcasing its
ODA to other parts of the world. In this respect ODA is supplied to those areas
(often middle income states) where immediate rather than long-term results can
be recorded (ODA Korea 2011). Credibility can be obtained by giving more
ODA whilst at the same time, and particularly in light of the Busan High Level
Talks on aid effectiveness, reducing ODA can be spun as a recognition of a
country’s effective and streamlined aid policy for immediate ‘results based’
impacts.
Yet within ASEAN there is emerging competition from other N-11’s such
as Thailand and Indonesia. In 2009, the South Korean Government through its
soft power platform made public the New Asia Initiative aiming at strengthening
ties with ASEAN. Following the conclusion of the Korea–ASEAN FTA, South
Korea also hosted the Korea–ASEAN Commemorative Summit by inviting the
10 heads of state from the ASEAN member countries. In 2010, the relationship
between South Korea and ASEAN was further elevated to a strategic partnership,
expanding bilateral ties into a greater variety of areas, including culture, education
and security as well as the economy. South Korea actually ranked second following
China in terms of trade with ASEAN, and even unseating the EU, Japan and the
United States. As President Lee (2012) announced:
Korea is the only country in the world to join the ranks of advanced nations
after being one of the poorest nations in just the span of a generation
following the end of the War. For this reason, many ASEAN member nations
want to take Korea as their development model rather than advanced nations
since they are in a similar situation as Korea was. Indonesian President
Asian ODA 179
Susilo Bambang Yudhoyono once said to me that his country’s economic
development goals are clear, which is to emulate what Korea has achieved
up to now. Korea is already engaged in full-scale collaboration in many areas
with Indonesia, which has a population of 250 million … Thailand with a
population of 70 million is carrying out a national project similar to Korea’s
Four Major Rivers Restoration Project. Korea, China and Japan are now
engaged in heated competitions to win a contract for the project that will
begin in earnest early next year.
President Lee (2012) also alluded to Japan and China in wanting to cooperate
with South Korea as a pivot or bridge, stating in the same statement that ‘A week
before I visited Thailand last time, Japanese Prime Minister Yoshihiko Noda
made a visit to the country. Last week, Chinese Premier Wen Jiabao also visited
the country’. As with Africa, President Lee (2012) was making the case that South
Korea is ‘slow and steady’, not rushing into the competitive scramble of the other
Asian donors, but acting with restraint. He stated that ‘In the past, about 90% of
ASEAN was a market for Japan. The establishment of the ASEAN–Korea Centre
in 2009 and the opening of the Korea–ASEAN Representative Office in Jakarta,
Indonesia, in September this year are significant in that connection. As such my
Administration has prepared new sources for the staples needed by the nation.
I hope they will serve as firm stepping stones for the incoming Administration
as the country continues to march toward a Greater Korea’. The South Korean
government’s New Asia Initiative seeks to upgrade Korea’s role as a power
player in Asia by engaging the region and creating stronger ties. The initiative
represents a shift in South Korea’s foreign policy focus from the US, China, Japan
and Russia, to the smaller regional neighbours. This shift will potentially expand
South Korea’s foreign policy focus from Northeast Asia to the Asian region.
However it is a fine balance. The shifting from the traditional powers remit (if the
big powers ‘allow’ South Korea leverage to do this) means potentially losing its
‘bridge facility’ and at the same time South Korea might be interpreted by smaller
nations as a ‘hegemonic’ state, as phrases such as ‘Greater Korea’ do perhaps
have more pejorative connotations, whilst rising Next-11s in ASEAN such as
Indonesia and Thailand may start flexing their own influence in the region and
directly with the more powerful hegemons. Both Thailand and Indonesia are now
starting to develop their own ODA approaches. Thailand now provides aid to its
own neighbouring countries in order to secure borders from migration through its
‘Neighbouring Countries Economic Development Cooperation Agency’.
The scope of cooperation will be also extended from economy to security, culture,
energy and other sectors. By joining the ASEAN Regional Forum (ARF) in 1994
and by acceding to the Treaty of Amity and Cooperation in Southeast Asia (TAC) in
2004, South Korea has also strengthened its relations with ASEAN. Before the G20
summit which was hosted by Seoul in 2010, ASEAN leaders had expressed their
hope that South Korea would, as a ‘bridge nation’, consider inviting the ASEAN
Chair to attend the G20 Summit which was held in Seoul in 2010 as a ‘seat at
the high table’ (ASEAN 2009). South Korea’s policies are replete with words such
180 Asian ODA
as ‘bridges’ and ‘waves’. KOICA (2010) stated that it ‘has implemented grant aid
in order to support sustainable socio-economic development’ and ‘continues to
concentrate its program on Asia and Pacific countries, as Korea has reaffirmed its
commitment to ease development disparities in ASEAN countries’. As Yul (2004)
noted, many ASEAN countries send aid workers and volunteers to South Korea to
‘learn first hand about Korea’s development experience’ (Yul 2004: 92). According
to KOICA (2010), sectoral priorities in Asia now include the environment, health
and education. APEC (2013) has also specified the importance of accepting the
diversity of a range of development levels and experiences. However, there are
concerns that this emphasis ‘on diversity’ ignores the underlying power distinctions
and power leverages which are obscured by the language of ‘harmony’ and technical
assistance.
Conclusion
This chapter has discussed the role of Asian donors in Asia as a reflection of
the underlying geopolitical dynamics in the Asian region. The chapter also
set out the distribution of Asian ODA and its sector emphasis, as well as the
ways in which the Asian donors are legitimating their ODA to the region and
particular recipients. The impact of the Asian donors on recipient countries in
the region is increasing and this is creating patterns of donor competition which
is generating concerns with project replication in what is increasingly a very
crowded market. At the same time this is giving recipients increasing leverage.
The chapter has argued that the 1997 Asian crisis still plays an important role
in determining Asian countries’ responses to the West, mainstream institutions
and the regional neighbours. History, crises and conflicts are an increasingly
vital part of how Asian donors ‘sell’ their ODA and their own development
experience to prospective recipients and partners and how this process itself
impacts on a donor state’s own national identity and the perception of its role
in Asia. This self-perception, however, might not always match the geopolitical
and geoeconomic reality. It is also clear that ‘emerging powers’ in Asia cannot
be placed as ‘a group’ per se but have a set of constantly shifting priorities. This
diversity reflects forms of political, economic and cultural competition as well as
underlying power inequalities.
Notes
1 This has also been generated by cooperation on environmental issues in the region and
concern with the impact of China’s rise on regional levels of pollution such as ‘yellow
sand’.
2 ‘Japan’s Abe ends Myanmar visit with aid debt write off’ 26 May 2013 www.reuters.
com/article/2013/05/26/us-myanmar-japan-idUSBRE94P04M20130526
3 ‘Japan Helps India: Outline of Japan’s ODA to India’ www.in.emb-japan.go.jp/Japan-
India-Relations/Japan_ODA_India.html
4 ‘Framework Act on International Development Cooperation’ http://odakorea.go.kr/
eng.policy.Legal.do
Asian ODA 181
5 ‘Barack Obama Hails Burma’s Thein Sein on US visit’ www.bbc.co.uk/news/world-
asia-22565267
6 ‘Taiwan Hopes to Join ASEAN led RCAP Trade Pact’ The China Post 14 April 2013
www.chinapost.com.tw/taiwan/national/national-news/2013/04/14/375996/Taiwan-
hopes.htm
7 Joint panel presentation with KOICA Vice-President, Wonju, South Korea, August
2012.
8 Discussion session at Ajou University, with the Indonesian Ambassador to South
Korea, Suwon, 2011.
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5 Emerging powers, Asian
foreign aid and the greening
of geopolitics
Introduction
The environment and economic development are traditionally thought to be
diametrically opposed (Nygren and Rikoon 2008). Sustainable development has
long been recognised as the ‘trade-off’ between the two. In this respect, economic
growth is fundamentally linked to questions of environmental sustainability.
Millennium Development Goal (MDG) 7 highlighted the importance of the
concept of ‘sustainable development’. This concept had emerged in narratives
on development following the 1987 Brundlandt Report which defined sustainable
development as ‘an inter-generational responsibility’ for meeting the needs of
the present, without compromising the ability of future generations to be able to
meet their own needs.1 Climate change debates have also led to issues concerning
the ‘resilience’ and adaptability of states, societies and economies in an age
of global environmental risk. Whether human induced or not, whether real or
not, the controversies concerning climate change have induced policies based
on quantifying and controlling ‘risk’ assessments, vulnerabilities and data sets
on possible scenarios. For IR, climate change has begun questioning the very
concept of national security and the meaning of the term ‘threat’. There are
also the various economic and environmental paradoxes of climate change. For
instance, climate change can open up trade routes and natural resources but at
the same time cause widespread flooding of agricultural areas which can create
food shortage crises and a movement of people as ‘climate refugees’ (Blaike and
Brookefield 1987; Cameron and Cloth 2012; Earth Negotiations Bulletin 2011).
This ‘push and pull’ movement can create numerous tensions over access and
ownership of land rights, water resources and territorial rights.
For the developing world, environmentalists have often been regarded as
harbingers of ‘stopping growth’ and unintentionally depriving populations of the
benefits of economic growth. Environmentalism has been regarded as a ‘post-
material’ or ‘middle class’ ethic, whilst the poor desperately search for their
economic survival. Moreover, it is often the poorest who are the most vulnerable
to the impacts of environmental damage, climate change and pollution. From a
geopolitical perspective, environmental legislation has often been viewed as a
way for the powerful nations to stop development and future challenges from the
The greening of geopolitics 187
developing world. The various conferences also reflect geopolitical competition
and cooperation, whilst the leading nations themselves circumvent any green
legislation and often fail to cooperate. In this respect, ODA is interpreted by
developing nations as a ‘pay off’ not to develop, or, where ODA is channelled for
schemes of environmental protection, this itself is often regarded as reducing the
prospects for economic growth by ‘protecting green zones’.
Climate change has led many donor governments to be able to ‘share their
climate change experience’. China, as a large landmass state, also has diverse
climate changes issues such as growing desertification and glacier-melting in
the Himalaya region. China also suffers from urban pollution or ‘airpocalypse’.
Japan has its own particular issues with regard to the impacts of climate change
on rising sea levels (tsunamis) and nuclear energy (JICA 2012). JICA’s Annual
Report (2009) noted that its ‘activities focus on minimizing climate change
risks from the viewpoint of human security for socially vulnerable people’ and
undertakes cooperation that offers the co-benefits of greenhouse gas reduction
and sustainable development (JICA 2009). The term ‘minimizing’ clearly implies
that there is an acceptance of climate change but efforts to make states resilient
or ‘anti-fragile’. Moreover, there are issues regarding establishing specific
environmental rights (such as to live in a pollution free and safe environment)
and wider questions of human rights and labour rights. Under the authoritarian
regimes in South Korea (1961–1987) ‘environmental integrity’ rights were often
separated from democratic rights and the wider dynamics of a specific form of
uneven economic development within the developmentalist state. One recent
concern from groups such as Amnesty International has been that defining
‘environmental rights’ has not been linked to the wider social questions of labour
and human rights. Moreover, a focus on green issues through concepts such as
‘socially vulnerable people’ marginalises the link between climate change which
is not just ‘human induced’ activity but comes from the activity of specific human
interests in a specific historical form of development. However, South Korea is, as
a new middle power, increasingly proactive in setting the ‘green growth agenda’.
Across the Asian region, China is often blamed by its neighbouring states for
worsening seasonal phenomenon conditions such as ‘yellow sand’ air pollution
across South Korea and Japan. South Korea has been keen to engage with land
management projects in Mongolia to ease the yellow sand issue. China now
has its own climate change policy in response to the negative externalities of
its rapid industrialisation (China 2007; GOC 2011; Gong 2011). In this respect
the broader climate change issue has also been linked to questions over natural
resource scarcity (Lee, B. 2012; Kyoto 1997). The link made is usually that carbon
emitting resources are not only damaging the environment but are also becoming
increasingly scarce. On the one hand, as a result, resource depletion and resource
scarcity could be seen to be positive realities for environment sustainability and
provide incentives for a shift to a ‘non-carbon’ based development paradigm. On
the other hand, there is a view that economic growth can in fact continue along
the same development trajectory but through different mechanisms and strategies
of environmental adaptation and mitigation.
188 The greening of geopolitics
The term green is, nevertheless, ubiquitous in development debates, with
phrases and neologisms abounding, such as green wash, green taxes, green
financing and, along with green growth investment, general concerns with ‘green
asset investment bubbles’. This is the concern that overspending in high-grade
‘green technology’ might unintentionally create speculation and an appreciation
of prices and costs in selected financial areas which cannot be absorbed or
sustained by existing institutional capacities and which crowd out investment
(Cancun 2012). There is also the issue as to whether the state should subsidise
green technologies.
The United Nations Environmental Programme (UNEP) (GGKP 2013: 1) has
pointed out that ‘Green Growth seeks to fuse sustainable development’s economic
and environmental pillars into a single intellectual and policy planning process,
thereby recasting the very essence of the development model so that it is capable
of producing strong and sustainable growth simultaneously.’ Green growth is
also seen to be the answer to the current global economic crisis (as government
support and/or opening up markets for creative technologies) and to secure the
state from future environmental risks and threats. In this respect, climate change
is seen to be a direct cause of ‘traditional’ security issues (conflict over resources)
as well as more specifically ‘environmental security’ issues such as drought,
flooding, hurricane intensity and rising sea levels, which, in themselves, are often
more destructive to humanity than traditional ‘military’ conflict. This has led to
an interest in creating mitigation policies and adaptation policies so as to create
more robust and resilient so-called ‘critical’ infrastructures (energy, transport,
water supply links). Environmentalists from leftist NGOs have had concerns
with the realist ‘militarising’ of environmental security; also the more right-wing
environmentalists have wrapped up ‘environmental protection’ in a banner of
ethnic nationalism and ethnic security for ‘their people’. Yet many leftist NGOs
also use similar language of protecting the ‘land’ and the ‘people’. A further
recent issue in critical IR has been with the ‘new materialism’ approaches, where
land and soil erosion as a result of climate change and desertification, is in effect
blowing away ‘sovereign’ particles of territory from and across borders (Nyers
2012; Parker and Vaughan-Williams 2009).
This chapter considers the relationship between Asian donor ODA and emerging
green growth policies as a response to poverty and development concerns in an
age of climate change. Developed nations (as in the Aid 2 paradigm) are regarded
as neutralising major power inequalities through rather abstract talk of ‘global
cooperation’ and ‘diversity’. However, emerging powers, and in particular South
Korea, acting as a middle power bridge, are challenging this particular trade-off
and why. South Korea is using its experience of rapid development and the dangers
of ‘growth first, environmental integrity later’ to share with other developing
nations, whilst at the same time, and perhaps paradoxically, also promoting ‘green
growth’ with very little experience of this particular approach. The chapter also
discusses this in the context of the new agenda regarding the relations between the
Asian donor states and the impact on donor–recipient relationships of accessing
future natural resources and shipping routes in and across the Arctic. The access
The greening of geopolitics 189
to these routes and resources changes the relationships both between Asian donors
and impacts on the donor–recipient relationship for those ODA recipient countries
currently regarded as a donor priority for geopolitical strategic and resources
purposes.
This opens out a number of interrelated issues. Firstly, whether green growth
means that the developing nations can bypass the traditional development
trajectories. Secondly, whether the aid recipients are in fact willing to bypass
trajectories that have led to the rapid development in the emerging powers.
Thirdly, whether green growth is supplementary to previous and traditional
development models. Fourth, whether green technologies allow the developing
nations to carry on a traditional development trajectory without the need for green
growth investment. There are concerns that designated ‘green growth zones’
might be protected (and yet this itself is a deeper market commodification of
natural resources) yet outside these zones, illegal practices of environmental
destruction such as logging continue (and are accelerated) as land becomes
scarcer and government monitoring becomes more focused on the protected zones
(Human Rights Watch 2013). Finally, there is always the underlying ‘free-rider’
conundrum that green efforts merely accelerate ‘business as usual’ growth on the
basis that green policies (or someone else’s policies) can ‘sweep up’ afterwards.
Many governments have therefore called for assistance on ‘green’ policing,
surveillance and monitoring technology but there are concerns that this is another
instrument of the state to restrict human rights and a new ‘green’ authoritarianism.
Nonetheless, green growth has become a part of South–south cooperation
(Khoday and Perch 2012). The green growth paradigm makes no distinction
The greening of geopolitics 195
therefore between wealth creation and the environment by arguing that individuals
and countries can be wealthy only if the environment is built into development.
South Korea has identified that achieving a significant cut in emissions requires a
shift from energy-intensive industries to low-carbon ones (Park 2012). According
to the former South Korean Environmental Minister:
[O]ne of the fundamental problems with the current economic system is that
it is both economically and environmentally unsustainable in its reliance
solely on traditional energy-intensive industries … This new growth strategy
is also in line with the directions that the majority of advanced nations
take for their national development … those countries are committed to
achieving environmental conservation and economic growth at the same time
by investing in the development of new technologies and fostering green
industries.
(Lee, M.-h 2009)
In December 2013, the South Korean government initiated the Green Climate
Fund in Songdo, Incheon. This fund aims to provide investment opportunities for
green technology and is not a ‘compensation’ fund. The aim of green ODA is to
transfer value added carbon capture technology and carbon-neutral technologies
from advanced countries to developing countries. In this sense developing
countries and emerging economies are seen to face the specific challenges
of achieving sustainable economic growth, reducing poverty, and enhancing
well-being, while moving their economies towards a green transformation.
Balancing and retooling the economy are seen to be equally important policy
goals at the core of the green economy (Clifford 2010). It was the Republic
of Kiribati (a relatively large aid recipient in the Pacific) which gave its final
approval to the Agreement on the Establishment of the Global Green Growth
Institute (GGGI) that officially paved the way for the GGGI’s conversion from
an NGO into an international organisation. Thomas Hale et al. (2013) argued
that institutional gridlock is a paradoxical result of institutional success given
that there are ‘harder problems’ to solve at a time of increasing numbers of
‘emerging powers’.
For Hulman et al. (2012) green growth can optimise economic growth by
incorporating a more effective use of environmental and natural resources by
advancing social equity into a more ‘holistic’ model that can also cater for the ‘laws’
of uncertainty. Growth is therefore compatible (if not dependent) on improving
resource efficiency and social equity (Allen and Cloth 2012). According to data
from the African Development Bank (AfDB 2012), roughly half of BRIC aid is
now based on improving ‘green’ infrastructure such as building efficient transport
networks. According to the ADB (2013), spending on green growth is linked to
questions of ‘distribution’ and welfare. In this respect green growth might be
regarded in the long term as a more cost-effective way of increasing economic
growth but which also might encourage less need for governments to spend
on health care and ‘safety nets’, on the basis that the old and environmentally
196 The greening of geopolitics
Table 5.1 Carbon emission ton per capita (2008), percentage of GDP for sectors of
education, health, and research and development
Carbon Education Health Research and
emissions (% of GDP) (% of GDP) Development
(tons/capita) (% of GDP)
Australia 18.48 4.7 6.0 2.2
Bangladesh 0.2 9 2.4 1.1
Cambodia 0.39 1.8 1.7 0.0
PRC 4.92 1.9 1.9 1.5
India 1.25 3.2 1.1 0.8
Indonesia 1.69 3.5 1.2 0.0
Japan 9.02 3.4 6.5 3.4
Laos 2.3 0.8 0.0
Malaysia 6.70 4.5 1.9 0.6
Mongolia 4.33 5.1 3.5 0.2
Myanmar 0.24 1.3 0.2 0.2
New Zealand 7.74 6.2 7.1 1.3
Pakistan 0.81 2.9 0.8 0.7
Philippines 0.80 2.6 1.3 0.1
Singapore 9.16 2.8 1.0 2.6
South Korea 10.31 4.2 3.5 3.5
Sri Lanka 0.61 7.1 2.0 0.2
Thailand 3.41 4.9 2.7 0.2
Vietnam 1.19 5.3 2.8 0.2
Source: Asian Development Bank (2013: 128).
unfriendly development model has been transcended. South Korea has one of the
largest per capita emissions of carbon dioxide in the region, and one of the lowest
levels of health care spending (Table 5.1).
According to the Asian Development Bank (ADB 2013) Japan has the highest
rate of new green patents (Table 5.2).
The OECD’s (2009) original communiqué on green growth stressed that
‘Green growth will be relevant going beyond the current crisis, addressing
urgent challenges including the fight against climate change and environmental
degradation, enhancement of energy security, and the creation of new engines
for economic growth’. According to the OECD (2013b) a strong, stable and
sustainable future for developing countries can be achieved through green growth.
Countries in the developing world often have difficulties in capacity building
and using finance in the creation of a green economy due to the persistence of
an ‘informal economy’ and an urgent need for rapid development but with few
incentives for natural resource protection.
The greening of geopolitics 197
Table 5.2 Leading countries for green patents as the average percentage of world inventions
(2002–2007)
Japan 20.8
Germany 17.8
US 14.1
South Korea 5.6
PRC 3.9
Canada 3.0
France 4.4
UK 4.3
Australia 2.9
Sweden 1.7
Source Asian Development Bank (2013: 161)
The OECD (2013a) also noted that there are a number of problems including
matching the long-term welfare benefits of green growth with short-term
transition costs. This can put pressure on newly democratic governments, as
well as on issues of coordination and pricing instruments over natural resource
ownership, and to encourage an investment policy based on technology innovation
and climate change adaption. For the OECD (2012), climate change and green
growth is undoubtedly an incentive for future technological development which
implicitly feeds into health issues and economic growth by enhancing capacity
and strengthening ODA by targeting those areas where private investment is
limited and resources scarce and part of aid effectiveness. The WTO argues
that green growth is an opportunity to open market bottlenecks and generate
market incentives. However governments also need to be clear as to what green
growth policy consists of, to allow for more predictability for risk takers (Hynes
2012). Such consistencies and regulations are the opposite of South Korea’s
green growth where leading chaebols prefer ‘spontaneity’ in regulation which is
justified as neoliberal flexibility but which can exclude other points of view and
actors. In this respect, this particular approach to spontaneity is only possible in
a centralised and exclusive hierarchical system.
Korea will embark on a path of actively contributing to the world and all of
humanity. This is the very goal that Global Korea aims for … Korea, while not
included in Annex I of the United Nations Framework Convention on Climate
Change (UNFCCC), plans to make a voluntary announcement before the end
of this year, its midterm target emissions cut by the year 2020. Korea has
proposed to establish a Registry of Nationally Appropriate Mitigation Actions
(NAMAs) of developing countries at the Secretariat of the UNFCCC, with a
view to inviting developing countries to voluntarily participate in mitigation
actions and providing the international support that they need.
(Lee, M-b 2009)
It may take another year, but that’s the only way we’ll end up with international
rules that everyone agrees on and which respect the sensitivities of all
members and the vulnerabilities of those who do not have the financial tools
to improve their own situation … Lowering customs duties could encourage
technological transfer, for example. There are a number of different ideas, but
we have to convince the international community … We have major partners
involved in the climate talk processes … which represent one-third of all
United Nations members, and the Environmental Integrity Group.
(Cancun 2012)
At the 18th session of the COPs held in Doha, South Korea as an Environment
Integrity Group (EIG) member (with Mexico and Switzerland), hosted a high-
level international conference called the Pre-Conference of the Parties Meeting
to push for ‘efforts to play a bridging role between developed and developing
countries in fighting climate change’ and ‘to create and implement national
and local-level strategies, policies and institutional mechanisms for green
growth’ (Na 2012). GGGI is also described as a new type of multi-stakeholder
institution that combines governments’ public reliability and the dynamic power
of the private sector partnerships by opening doors to specialists and generating
cooperation which is pragmatic and performance orientated. Currently, the
GGGI is active in Ethiopia, Indonesia, Vietnam, Kazakhstan, the United Arab
200 The greening of geopolitics
Emirates (UAE) and Cambodia, all listed as top recipients in South Korea’s 2012
OECD peer review. Together with other partner countries, specific green growth
projects range from household irrigation to deforestation issues.8 Since 2008,
the South Korean government has carried out the five-year EACP programme
and has offered help in five priority areas: water management, low-carbon
energy, low-carbon cities, waste management, and forestation. The government
has been conducting bilateral and multilateral environmental projects, inviting
government officials for training in South Korea, and conducting research in
green growth for developing countries. KOICA has accepted project requests
from 31 countries and conducted feasibility studies. For some, green growth
would also take South Korea off a reliance on a certain country’s oil which puts
South Korea in a tense relationship with its strategic allies.9
We will endeavor to ensure human security for all people in the Mekong
region through their protection and empowerment. In order to achieve human
security and thereby sustainable development, it is necessary to promote low-
The greening of geopolitics 205
carbon growth, to build a climate-resilient society, to achieve transition to
green economy and to preserve the natural conditions for the Mekong region.
Recognizing the importance of these efforts, we will enhance Mekong–Japan
cooperation on environment, climate changes, disaster risk reduction, public
health and food security and safety, and social protection. We strongly believe
that our cooperation in minimizing risks and harmonizing the economic,
social and environmental pillars lays a strong foundation for sustainable
growth in the region … We support efforts that will benefit all people in the
Mekong region and ensure human security. In this context, we established
specific goals for the Mekong region to achieve by 2015, which contribute
to achieve MDGs 4, 5 and 6 in the region. We will make an effort to achieve
these goals, recognizing that attaining universal health coverage is a key to
equitable society and sustainable development.
(MoFA 2012)
Chinese banks have vowed to offer strong credit support for the development
of a green economy amid China’s drive to promote ecological progress and to
curb regional pollution. At the same time, the Chinese government is now in
effect building a mechanism to provide positive incentives for green finance due
to its immense foreign currency reserves. Ten financial institutions are involved,
such as the Industrial and Commercial Bank of China, China Construction Bank,
Bank of China and Agricultural Bank of China. This is also to enhance China’s
domestic credibility over green growth as this is an area of which South Korea
and Japan are particularly active in the aid market ‘gap’. By 2012, the Chinese
Construction Bank was estimated to have loaned about 239.6 billion yuan (about
US$39.04 billion) for clean energy, energy saving and other related environmental
friendly projects. Still, sceptics claim this is ‘token’ greenism and part of the
charm offensive by segregating off green development from business as usual
(BAU) development and actually provides an incentive for BAU to continue on
the basis that there is now an ‘insurance’ cushion of green growth which in China
is often regarded as ‘sustainable development’. Nevertheless, the term ‘green’
is clearly symbolic and gesturing towards China’s own ‘green revolution’ of the
1970s which brought about its rapid economic development.
The focus of National Agenda 21 was on restructuring the economy, promoting
technology advancement and improving energy efficiency, strengthening
education, training and public awareness on climate change, with a relatively low
level of economic development (China 2007). The White Paper on Foreign Aid
set out in 2011, stated that the Chinese government is now addressing climate
change in its mid- and long-term planning. As the GOC (2011) pointed out:
China was one of the first countries which have developed clean energy
sources such as biogas and small hydropower stations. Thus, it has advantages
in this regard when it comes to foreign aid. At the beginning of its foreign
aid efforts, China helped developing countries in Asia and Africa in utilizing
local water resources to build small- and medium-sized hydropower stations
206 The greening of geopolitics
and projects of power transmission to meet the needs for electricity by local
people as well as by agricultural and industrial production. In the 1980s, by
working with relevant agencies of the United Nations, China imparted biogas
technologies to many developing countries. Meanwhile, China passed on
biogas technologies to Guyana and Uganda by way of bilateral aid. China’s
efforts achieved the expected results and helped the recipient countries reduce
their dependence on imported fuels.
China has steadily increased aid in coping with climate change. China has
expanded the scope of relevant aid to other countries. China has carried out
cooperation with Tunisia, Guinea, Vanuatu and Cuba in utilising biogas, has
assisted in the building of hydropower stations in Cameroon, Burundi and Guinea,
and has cooperated with Mongolia, Lebanon, Morocco and Papua New Guinea in
exploring solar energy and building wind-power stations (GOC 2011). In 2007,
China became the first developing country to formulate and implement a national
programme to address climate change. In 2009, China also put forward the goal
of action to reduce the per-unit GDP greenhouse gas emission in 2020 by 40–45
per cent. China has also adopted a range of major policy measures and targets to
mitigate and adapt to climate change during the Eleventh Five-Year Plan (2006–
2010) period. China is strengthening cooperation on science and technology, and
has implemented over 100 China–Africa joint scientific and technical research
demonstration projects. The Chinese government has aimed to bolster agricultural
cooperation and aid the construction of agricultural demonstration centres. China
has also offered support and assistance to small island states in the South Pacific,
the Caribbean and other regions.
China formulated and promulgated the Measures on the Operation and
Management of Clean Development Mechanism (CDM) Projects in 2005. China
also carries out capacity building to improve its capacity to promote CDM project
development, focusing on new energy and renewable energy, energy conservation
and the enhancement of energy efficiency, methane recycling and reutilisation and
other areas. A total of 1,560 Chinese projects have been registered with the United
Nations Clean Development Mechanism Executive Board. During the 12th Five-
Year Plan period, China addressed global climate change as an important task in
its economic and social development, with scientific development being the key
theme in accelerating economic development (Cameron and Cloth 2012). China
maintains that specific arrangements should be made at the Durban conference
regarding developed countries’ emission reduction commitments, their support
to developing countries in funds, technological transfers and capacity building.
However there is still the issue of reporting mechanisms (Jihua and Forgach 2012;
Zadek 2013). China does not object to informal or small-scale consultations on
urgent issues outside the negotiations on the Kyoto Protocol but as supplements
rather than substitutes for the negotiation process of the UNFCCC and Kyoto
Protocol (Watts 2011). Gong (2011) argued that those states outside the climate
change regime, along with the US and non-annex countries, are at an economic
advantage as they are not subject to international protocols or ‘green’ regulatory
The greening of geopolitics 207
constraints. At the same time, not fulfilling these international norms or obligations
can mean a longer term undermining of soft power and issue-linkage credibility
(Clark 2005). Climate policy could become a catalyst for broader reform (Jotzo
and Zhang 2013). China has helped developing countries in Asia and Africa with
small and medium-sized hydropower stations and grid construction to provide
electricity for industrial, agricultural and household use. In the 1980s, China
cooperated with relevant United Nations agencies to introduce biogas technology
to developing countries. At the same time, China transferred biogas technology
bilaterally to Guyana, Uganda, and elsewhere which helped to reduce the recipient
countries’ dependence on imported fuel. More recently, due to the rising impact
of global climate change, China launched biogas technology cooperation with
Cuba, Guinea, Tunisia and Vanuatu, and built hydropower stations in Burundi,
Cameroon and Guinea. China has also become engaged in opening solar and wind
power cooperation with Lebanon, Mongolia, Morocco and Papua New Guinea.
Assessments
Domestic credibility for exported green growth rests on navigating both critics of
green growth from the right (a fetter and overregulation of business) and the left
(by breaking the trade-off idea between development and the environment, green
growth is a justification for more market commodification of nature and land grabs).
Green growth’s technicist and instrumental approach for critics, just continues the
paradigm of ‘growth at all costs’ by privatising ‘nature’ (natural capitalism) as
capitalism continues to create and search for new markets and outlets for a crisis
of global under consumption. The success of the GGGI therefore relies on an
international regime to increase its remit whilst at the same time remaining focused
on its original purpose. New middle powers have the advantage of the narratives
on South–South cooperation and ‘partnership’ models of win-win, and yet there
can also be strategic splits within these relationships and new forms of hierarchies
generated as a paradoxical result of this cooperation. Finally, maintaining
international political support will be an on-going task for the GGGI, with emphasis
on South–South cooperation. Disasters such as Hurricane Katrina in 2005 were a
wake-up call, in that natural disasters and resource scarcities (‘water wars’) can do
as much damage as any military combat. In this sense security is now being tied to
issues of quantifying and living with ‘risk’, ‘robustness’ and resilience, providing
various mandates for innovation and insulation from external and unquantifiable
threats as states accept new security challenges which impact on their populations.
India and China are claiming that they have scientific credibility on issues of
melting ice and water management, given their shared experiences in the Himalayas.
Singapore is concerned that its historic trade role could be blocked off if states begin
to use the Northern Sea route, as well as issues of agriculture food security and as
a low lying island, repeating a narrative that all states have direct vulnerabilities
(Emmerson 2013; Teo 2013). South Korean companies Samsung and Hyundai are
building dry-bulk carriers which are now navigating through the Arctic. Shipping
companies have also found a route that runs along the Russian coast from the island
archipelago of Novaya Zemlya in the west to the Bering Strait in the east. This is
reducing voyage time by almost 40 per cent in comparison to the routes which pass
through the Panama and Suez canals. Such access would also allow US–Asian allies
to avoid having to rely on their oil from ‘rogue’ states such as Iran and Venezuela.
Samsung and Hyundai are involved in dry-bulk shipping technology and ice-
breaking technology. This is currently being exported to Denmark and Norway.
Hyundai Heavy Industries (HHI) have also been sending tankers, container ships and
other carriers into the region to market the products for potential buyers (Jakobson
2012). The new routes and issues surrounding this are affecting Asian responses to
210 The greening of geopolitics
African recipients and reflect a number of ongoing territorial island disputes in the
Asian region. These disputes again re-emerged on the domestic political agendas
and regarding questions of national history and national identity during the run up
to the Arctic Council decisions. These geopolitical and geocultural relationships are
therefore potentially impacting on donor to donor competition and cooperation both
in and outside the region.
Conclusion
Across many Asian states the trade-off between environmentalism and
development has been challenged. Whether green growth is a substantive
shift or a repackaging of developmentalism in crisis, or further deepening of
neoliberal globalisation, are issues discussed in this chapter. The chapter has
considered the green growth debate in the context of geopolitics and changing
perceptions of security and green ODA policy. Again issues raised include
whether cooperation is possible and green issues, whether new donors represent a
challenge to existing institutions and the strategic tensions with countries aiming
for development and recipient countries where green issues are often down
the agenda. The chapter considered and outlined recent green growth policies
from China, South Korea and Japan, discussing motivations and outcomes and
how these models are now being used in the foreign aid debate and using the
template from Chapters 2 and 3. The chapter linked to wider issues of the climate
change debate, tensions between the development and developing world and the
implications of the green ODA debate for these policies on recipient countries.
Middle incomes and emerging nations in East Asia are providing technology
and breaking through the debates and accusations of climate change between
the developed and developing world. Through this green growth is being used
by recipient models as a new paradigm that transcends the assumptions of what
development is and what it is for.
Notes
1 ‘MDG Target Seven’ www.un.org/millenniumgoals/environ
A point raised by former South Korean Deputy Foreign Minister and South Korean
Ambassador to Malaysia (Lee, Jong-yoon), at an Ajou University GSIS sponsored
Symposium (22 November 2013), who identified the importance of maintaining public
attitudes in the linking of environmentalism to economic distribution. However, in
middle income countries such as South Korea there was still a widespread view that
environmentalism hurts the economy and puts big businesses in a weakened position.
In low income countries there is an argument that ‘greenism’ and green ethics can be
simultaneously built into a framework of growth given that there is low economic
growth to start with, allowing for a leapfrog challenge to the ‘growth first distribution
later’ or ‘growth first and environmental integrity later’ approaches of the original
Asian drivers.
2 GGGI Members include Australia, Cambodia, Costa Rica, Denmark, Ethiopia,
Guyana, Indonesia, Kiribati, Mexico, Norway, Papua New Guinea, Paraguay,
South Korea, Philippines, Qatar, the UAE, the UK and Vietnam. The four non-state
The greening of geopolitics 211
representatives are GGGI Chair Lars Rassmussen, former PM of Denmark; Lord
Stern, UK; Kim Sang-hyup, Senior Secretary for Green Growth in Korea; and Montek
Ahluwalia, Deputy Chairman Planning Commission, India.
3 The Green New Deal has been crafted in line with such global trends, with its focus on
the following areas: 1) energy conservation, recycling and clean energy development
to build an energy-saving economy; 2) green transportation networks and clean
water supplies to upgrade the quality of life and environment; 3) carbon reductions
and stable supply of water resources to protect the earth and future generations; 4)
building of industrial and information infrastructures, and technology development
to use energy efficiently in preparation for the future.
4 The rivers in question are the Han, Geum, Nakdong and Yeongsan.
5 Comments made by former US Vice President Al Gore in a speech to invited students
and staff of Ajou University and local universities at the 2nd Green Purchasing
Conference, Suwon, South Korea, November 2009.
6 Comments made to author by Kang Seoung-soo, PCGG representative at Ajou
University, November 2010.
7 Comments made to delegates and author by the former South Korean Prime Minister
Han Seoung-soo at the 2008 Annual Meeting of the Korean Political Science
Association, Sokcho, South Korea, 28 August 2008.
8 Editorials in major newspapers focused on the Fukushima disaster as a wake-up call
to move away from nuclear energy toward promoting reform in the electricity market
and green technologies, in ‘Building a Nation of Green Growth’ The Japan Times
8 June 2012 www.japantimes.co.jp/opinion/2012/06/08/editorials/building-a-nation-
of-green-growth/#.UeCnZs6wd00
9 ‘Seoul to Halt Iranian Oil Imports by July’ The Korea Times 26 June 2012
10 ‘White Paper China’s Policies and Actions for Addressing Climate Change November
2011’ www.chinausfocus.com/library/government-resources/chinese-resources/
documents/white-paper-chinas-policies-and-actions-for-addressing-climate-change-
november-2011/
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6 From aid effectiveness to
public–private partnerships
New agendas in Asian ODA
Introduction
In 2011, the Fourth High-level Talks on Aid Effectiveness were hosted by South
Korea at the port city of Busan. At the conference, a number of side-panel questions
raised, particularly by NGO representatives, were whether aid effectiveness was
to be seen as a part of an evolutionary aid trajectory, a supplementary to previous
aid policies, or a break with previous aid policies. For some delegates, aid
effectiveness was an indication of what a post-2015 MDG agenda might look like
(Fernandez 2013). More recently, terms such as ‘development effectiveness’ and
‘capacity building’ have become increasingly prominent. For sceptics, however,
aid or development effectiveness continues (and reinforces) an exclusionary and
hierarchical tradition of elite-led ‘neoliberal technocracy’.
After all, the Busan Conference was widely promoted as ‘high level’ which
was much to the consternation of many grassroots civil society movements.
Indeed, from the smaller non-government organisations (NGOs) there was a view
that civil society was being split into the ‘elite’ groups and those groups that were
being further excluded, the more the larger NGOs were being invited to their
‘seats at the table’. Nonetheless, the two most recent aid effectiveness high level
talks took place in Ghana (2008) and South Korea (2011), indicating a recognition
of the increasingly prevalent role of the emerging powers and global South as
particularly proactive in aid effectiveness agenda setting. This means a greater
focus on aid quality rather than on aid quantity. Indeed, in this respect, the term
aid ‘effectiveness’ is a misnomer or a linguistic ‘double bind’, for no state would
hardly wish to promote a policy of aid ‘ineffectiveness’.
At Busan there was a clear emphasis, from many delegates attending, on
encouraging country ownership of aid and better domestic as well as international
institutional alignment. This notion of ‘global cooperation’ seemed to fit into the
remit of the Aid 2 paradigm. Japan and South Korea, as members of the OECD-
DAC, have tended to follow DAC norms, and peer review suggestions, whilst
both countries have also promoted a more ‘non-Western’ approach to aid.
For South Korea this is crucial to its ‘bridge’ role, whilst as a more established
DAC member, Japan has paradoxically had more leeway to be able to develop
a more flexible and independent approach. In the post-2008 financial era of
218 Aid effectiveness
austerity (and with ongoing drops in tax revenue for state-led foreign aid),
attention has now turned to the possibility of keeping an aid regime going but
by restructuring aid provision through aid effectiveness as well as linking this
directly and indirectly to public–private partnerships (PPPs) (Ban 2013; OECD
2012a, 2012b). There has also been a growing interest in how donor countries
can, and to some respects now are, utilise the growth of financial remittances from
their country nationals living in the diasporas in developed and emerging-power
states, in order to provide extra sources of revenue in the recipient country (World
Bank 2011). The emerging-powers literature has assumed that there has been a
seismic shift in the international system with the rise of the BRICSs and yet there
is also a trend toward economic and geopolitical unevenness within and between
the emerging powers (Wassener 2013).
Thus, in this chapter I consider the role of Asian donor public–private
partnerships (PPPs) and the ‘aid for trade’ policies as tools for ODA and
development (Kim et al. 2011; World Bank 2007). All three leading Asian
donors are now involved in these public and private initiatives (Aoki 2013).
Indeed, many recipient countries are now seriously considering the ‘bypassing’
of the traditional routes to development (stages of growth and ‘big push’) and
instead preferring to utilise these partnerships and integration into global
networks of development, trade and technology. This approach has both its
detractors and its supporters in terms of the nature of this integration and
whether this integration accelerates long-term growth or short and long-
term poverty. The use of smart phones and cell-phones is encouraging many
individuals living in once marginalised rural communities to begin to be able
to gain direct access to both the national and global markets. This has occurred
at the local market level, as technologies and satellite phones bypass uneven
national infrastructure and give local producers updated information on market
conditions and distribution information such as coordinating shipping and
‘pick ups’. This seems to be a revitalisation of Adam Smith’s ‘authentic’ ‘small
business’ classic liberalism in contrast to the top-down neoliberalism of the
Washington Consensus institutions.
This also implies that the ‘importing’ of developmental models from Asian
donors is an elite-led process and perhaps inappropriate for indigenous or home-
grown development. From some delegates at the pre-G20 Bridge Convention held
in Seoul in 2010, there was often a use of the acronym ‘SWEDWA’ (Stuff We Don’t
Want). Yet donors such as South Korea now also recognise that the ‘first donor
phase’ of exporting a particular ‘top-down’ or high-level based ‘developmentalist
experience’ model to recipients, is not necessarily a ‘results-based’ guarantee,
despite its soft power promotion during the G20 and Busan Conventions.
Instead, there has been a growing interest in the exporting of more ‘grassroots’
rural development models (Park 2009; Tasie 2009). This issue has more recently
been tied to questions in South Korea, China and Japan, concerning ‘top-down’
sustainability and the importance of constructing ‘the creative economy’ through
more emphasis on small and medium-sized enterprises (SMEs). However, this is
still very much early days and clearly a massive strategic and structural shift from
Aid effectiveness 219
a successful economic model that many elites, due to their own interests, would
perhaps rather delay.
The link between establishing a ‘creative economy’ and PPPs is not
straightforward, as PPPs and even grassroots rural development programmes
can reinforce particular ‘top-down’ and authoritarian trajectories of development
(e.g. China and South Korea during the 1970s) and reinforce the previous
developmentalist state–business relationships. This chapter places these initiatives
within the context of the recent global financial crisis and aid effectiveness
debates, a time of increasing economic uncertainty. In those Asian donors that
are democracies, this can directly or indirectly impact on positive or negative
attitudes toward ODA provision and therefore aid policy. In this respect, there
can often be gaps between what voters demand of governments and what
governments feel they need to do for the international credibility of the state and
its particular geopolitical role. Often this can result in a myriad of ‘nationalistic
narratives’ from both governments and wider public opinion. However, at the
same time (and as a result of this economic uncertainty) Asian donor governments
are also increasingly aware of other problematic and domestic structural issues
such as long-term fiscal issues and emerging demographic deficit shifts in their
countries. These concerns in turn have recently led both the South Korean and
Japanese governments to introduce a set of ‘multicultural’ policies in order to
attract migrants and increase the population growth pool. These policies are now
beginning to impact on, and open up, issues of national identity and a country’s
own official and unofficial self-reflection of its ‘place in the world’. This
tentative social transformation potentially impacts on donor state perceptions
of ‘the foreigner’ as well as attitudes toward ODA and the criteria for assessing
government and societal international responsibility.
Ethiopian farmers can settle contracts with their phones and be credited on
their bank accounts the next morning. Mobile money has exploded across
East Africa. Bangladesh is getting into business process outsourcing. Kenya
is now the world’s number one user of mobile banking. IT systems have
customs clearance times down to less than 10 minutes on some borders in
Central America. And other examples of where Aid for Trade was the spark
that lit the tinder … we still live in a world though where least developed
countries (LDCs) account for just over 1 per cent of this pie and 1.1 billion
live in absolute poverty. But this is a world in which those in absolute poverty
as a share of the total population in developing countries fell from 43 per cent
to 21 per cent between 1990 and 2010. A reduction of almost 1 billion people.
And at a time that trade barriers came down and WTO rules provided added
certainty. A coincidence? Not to my mind. With the post-2015 development
agenda starting to take shape, I believe that we can do more to ensure trade
plays a positive role in development.
The UNDP (2010, 2012) has regarded PPPs as a form of brokering, and
collaboration by encouraging partners who can bring multiple skills to dealing
with and solving the main development questions. PPPs were first introduced in
the UK by New Labour in the 1990s. This approach rejected the state-socialism
of old Labour but also rejected the market ethos of the new right ‘Thatcherites’
(Driver and Martell 2000). According to Jacob Hacker (2013), where the market
had failed the state was typically assumed to be able to in effect ‘clean up’.
This so-called ‘Third Way’, therefore, was part of a wider global project of the
1990s based on the UN’s Global Compact and ‘globalisation with a human face’
(UN 2000a, 2000b). This continued Kofi Annan’s (1999) own concerns with
globalisation at the turn of the millennium:
National markets are held together by shared values. In the face of economic
transition and insecurity, people know that if the worst comes to the worst,
they can rely on the expectation that certain minimum standards will prevail.
Aid effectiveness 227
But in the global market, people do not yet have that confidence. Until they
do have it, the global economy will be fragile and vulnerable – vulnerable
to backlash from all the ‘isms’ of our post-Cold War world: protectionism;
populism; nationalism; ethnic chauvinism; fanaticism; and terrorism …
Let us remember that the global markets and multilateral trading system
we have today did not come about by accident. They are the result of
enlightened policy choices made by governments since 1945. If we want
to maintain them in the new century, all of us – governments, corporations,
non-governmental organizations, international organizations – have to make
the right choices now.
As state funds begin to dry up in the age of austerity and donor country debt,
there is an argument to say that foreign aid can and should be placed more
at the door of private businesses and left to the free market rather than to aid
bureaucracies. Ban Ki-moon (2013) also called for more multi-stakeholding and
Hubbard’s point was that:
No lesser masters of the market than Bill Gates and Warren Buffett have
declared that the market has failed poor countries … So rather than investing
in the continent’s businesses and ventures, these billionaires fund NGOs and
government projects for health, education, and technology … But … you’ll
realize that many African economies have never had a business market to fail
… In essence, the market never failed because it never really existed.
(Hubbard 2009)
Thus, in this argument, a thriving business sector must come before the
physical and social infrastructure. In fact, the Marshall Plan (the leitmotif of state-
led aid) only worked because it provided grants and made loans to European
businesses (via the government) first, and then paid money back into a national
pot to fund the infrastructure (although there was already a basic infrastructure in
place). In the recent ADB evaluations (ADB 2008, 2009, 2011, 2012) emphasis
has been placed on promoting different contractual relationships between public
sector and private sector entities. For Birdsall (2013) the emerging powers are
now providing increasing levels of finance to the regional development banks in
order to achieve cheaper loans and to reduce borrowing costs for both donor and
recipient in the future.
Defining PPPs
Generally, a PPP agreement is defined as a long-term contractual relationship
between a public body and a private partner (or a consortium of private firms)
for the construction and operation of infrastructure. The private partner will be
in charge of building, managing and asset maintenance, service provision and
financing the investment, in exchange for regular payment by the government
and/or user charges. Distinctions have been made between Build Transfer Operate
228 Aid effectiveness
(BTO) projects (construction by a private consortium, with private ownership
transferred to the government and then operated by the private sector) and BTL
(Build Transfer Lease) projects with construction by the private sector, with
public ownership by the government and then future leases by the government
back to the private sector. For Hawkesworth (2011) PPPs are the provision by
the private sector of a public service through a contract that can backload the
cash flow payment for the government arising from the provision of the service.
This is promoted as a sharing of risk between the public and private sectors. As
Hawkesworth (2011) noted, the percentages of infrastructure projects which now
count as PPPs among the OECD countries range from 0 to 5 per cent (Austria,
Germany, Canada, Denmark, France, Lithuania, Holland, Hungary, Norway,
Spain), from 5 to 10 per cent (UK, Czech Republic, Slovakia, Greece, Italy,
South Africa, Ireland), from 10 to 15 per cent (South Korea) and from 20 per cent
(Mexico, Chile). In this sense it seems to be the emerging nations that seem to be
picking up the PPP approach.
A recent World Bank Development Report (World Bank 2007) argued that
PPPs have the potential to create jobs, and encourage entrepreneurship and
innovative capacity. Often the public sector is regarded as the primary provider of
infrastructure service and contents but the private sector then operates at agreed
costs with the government through a process of competitive bidding. This is seen
as a low risk option in difficult financial times for expanding the private sector
in helping the public sector for short-term and quick delivery projects. But the
government might also have its corporate favourites and connections, particularly
in developmentalist states. Contracts mean that the daily management issues also
go to a contractor who is paid for their labour and other costs. Lease contracts
occur when the private sector collects a revenue from the public sector but then
pays the contracting public authority an affirmage fee.
For instance, Cheng and Wang (2009) defined Chinese PPPs as ‘an
arrangement whereby private parties participate in or provide support for the
provision of infrastructure. A PPP project results from a contract between
government and a private entity to deliver public infrastructure based services’.
The Chinese have mostly preferred the BTO system. The first wave of PPPs
had ended by the 1990s as there was a view that the central government had
lost control of the local PPPs, and that local political power bases particularly
in the interior, were becoming seen as a challenge to the central government in
Beijing. However, often local government is used by the central government
as a scapegoat to dispel any criticism of Beijing policy leading to difficulties
in transparency and identifying the ‘chain of command’. This is a concern for
many Chinese aid recipients. A number of laws then ensued during the late 1990s
including the 2004 Method of Managing Urban Public Utility concessions and
the 2004 Decision on Reforming Investment Solutions. This followed the 1995
regulation of BTO by the Ministry of Foreign Aid and Economic Cooperation
concerning the amount of foreign exchange and foreign investment that could
be used in BTO projects. In 1999 a Tendering and Bidding Law allowed the
Chinese private sector to invest in areas where previously ‘foreigners only’ had
Aid effectiveness 229
been allowed to invest. Indeed in Asian economies and societies the state-led
policy of ‘foreign only’ zones is promoted as a ‘respect for diversity’ but can
often have the unintended consequence of inverted racism/stereotyping and thus
lead to cultural segregations and hierarchies, justified on the basis of soft power
‘gifts’, ‘paternalism’ and ‘hospitality’.
There is, nevertheless, a concern that PPPs can help abrogate donor and recipient
state responsibility as issues become further depoliticised under the mantra of
‘diversity’ and technocratic pragmatism. The underlying reason for PPP growth in
the Chinese road sector is rising ownership of cars among the new middle class.
Therefore, to satisfy increasing demands and expectations, PPPs are seen as a
solution for alleviating the fiscal pressures of debt on the public sector and for
speeding up the infrastructure recovery process (Yoo 2010). This is also an issue
of the domestic credibility of donors as they sell their development experience or
development expertise overseas. However, without enforced legal safeguards for
PPPs, there are concerns that public authorities and private contractors engage
in speedy contracting which excludes the tax-paying and service-using public.
Making legislation allowing for consistency and an independent judiciary is an
important step to transparency, as well as promoting various practical measures to
curb strategic behaviour in the field of tendering (selecting the right contractors),
construction, operation and maintenance (effective quality supervision). For
some, introducing PPPs does not necessarily have depoliticising effects but, on the
contrary, can indirectly or directly pressurise governments to be more accountable
for a successful project. The Chinese view is that with the creation of top-down
formal rules, trust between the public and private sectors is eventually bound to
grow stronger (Liu and Yamamoto 2009).
Ernst and Young (2011) identified the significance of PPP projects between
cooperating Asian donors such as HITEC city Hyderabad and the Rajiv
Gandhi international airport in India which has gained from Japanese technical
assistance. Yet, as the aid effectiveness conference at Accra pointed out, there
also remain challenges in creating a regulatory environment and the need for more
feasibility reports. Between India and China there has been donor competition,
as manifested in social infrastructure projects such as hosting the Olympics and
the Commonwealth Games. In India, PPPs have been particularly important in
the areas of economic and social infrastructure projects. Distinctions are made
between design built contracts which save time and cost, allowing for milestone
linked payments and penalties, and the performance based contracts which occur
when the project is constrained by finite economic resources. The most common
forms are ‘user fee’ BTO models for the large-scale road and airports projects, and
an annuity model where the sectors and project do not entail user cost recoveries
such as user charges or toll booths.
Conclusion
The aid effectiveness debate has been seen as an almost inevitable and, to a degree,
a pre-emptive accelerator, to speed up MDG completion as damage limitation
rather than a qualitative new approach to aid. For some, this is simply too little
too late, and in effect a band aid over fundamental flaws in the Aid 1.0 paradigm.
Whilst there was a positive spin on aid effectiveness and ‘value added aid’, there
were also concerns that this was an excuse to actually lower aid amounts, either as
a threat for better government accountability or after the fact, with the reasoning
that lower aid amounts had proved aid effectiveness was in place and likely to
be working and therefore that donor agencies would be credited. In this sense
the narrative of aid effectiveness has focused on whether the impact of aid is
conditional on policy only, or aid can also be expected to have a separate and
positive impact, irrespective and independent of intended donor agency policy.
These are questions as to whether the allocation of aid to those states lagging
behind determines the opportunity costs of completing, globally, the MDGs; that
is, aid would have a bigger ‘snapshot’ impact on those countries but, in providing
aid to those countries nearly graduating and nearing a sustainable growth from
(and for) the ‘big push’, this would more likely mean MDG completion.
At the 2013 World Economic Forum (WEF 2013) it was accepted that the
recent financial crisis has put pressure on all states’ ability and willingness to
provide ODA. This chapter has argued that whilst the Asian donors and emerging
powers are playing an increasingly vibrant role in ODA, this role now needs to
be placed in broader issues regarding the sustainability of the emerging powers.
It is perhaps no coincidence that the debates on the role of emerging powers and
ODA and aid effectiveness began during and in the aftermath of the 2008 financial
crisis. An interrelated aspect of this debate is public awareness and willingness
to provide ODA, and a pragmatic realisation that public and private sectors now
need to, and can, work together. These partnerships are not necessarily equal, and
yet the assumed leverage of the business sector is also reliant on state funding,
a willingness to take risks, and an awareness by communities of the diversity of
240 Aid effectiveness
options and resources now becoming available. At a time when many recipient
nations are now developing rapidly, the possibility of such partnerships may prove
irresistible (particularly the information and skills required and learnt) rather than
relying on a results based and ‘impact’ aid effectiveness.
Notes
1 Group discussions at Global Civic Sharing, 1701, Garden Tower, Anguk, Seoul, on 27
May 2011 and interview with Kim, Min-young, Director of Global Civic Sharing, in
Seoul, on 27 May 2011.
2 Yonsei Wonju Campus, Korean Society for Public Administration, statements by
KOICA Vice-President, August 2012
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7 Conclusion
The world has changed significantly since the conception of the Millennium
Development Goals. Despite the progress made, important gaps remain. The
geography of poverty has evolved. Inequality is on the rise. The challenge
of sustainable development is even more pressing. Meanwhile, a multi-
polar economy has taken shape. Emerging economies play a larger role in
development cooperation. So does an array of new and emerging actors:
Southern providers, the private sector, philanthropy and civil society
organizations.1
Notes
1 2013 Ethiopia High-level Symposium on A Renewed Global Partnership for
Development for a Post-2015 era’ www.un.org/en/ecosoc/newfunct/dcfethiopia.shtml
2 ‘China Turns to Adam Smith’ The Daily Telegraph 16 November 2009, www.
telegraph.co.uk/finance/economics/6584906/China–turns-to-Adam-Smith.html
Index
Note: Page numbers in italic refer to boxes Arctic Council, membership, 10–11, 22 n6
and tables. Page numbers followed by an ‘n’ ASEAN (Association of South East Asian
refer to notes. Nations): and Asian geopolitics in the
post-Cold War era, 87–89; and China,
Abenomics, move toward, 155–157 87–88, 93–94, 160–163; goals of, 160–
ADB (Asian Development Bank), 189–190 161; growth of, 69; and Japan, 160–163;
Africa: aid controversy, 139–142; and Asian membership, 10–11; and South Korea,
ODA, 112–113; Chinese aid, 107, 115– 88–89; splits within, 161–162
116; climate change issues, 189–190; ASEAN plus three (APT), formation of, 92
cool war in, 117–127, 120, 122, 123, Asian Development Bank (ADB), 189–190
127; debt cancellation programmes, Asian donors. See also donors: and Africa,
105–106; East Africa, 116–117; emula- 112–113; and Myanmar, 174–175; per-
tion of Asian driver model(s), 104–107; spectives, 110–112; shared experience
Japanese aid, 107–109, 110, 118–123, narrative, 158–159
120, 122, 123; natural resources, 106; Asian drivers: demographics in, 221–222;
relationship with China, 133–135; emulation of, 104–107; rise of, 11; sus-
RISING, 113–114; South Korean aid, tainability of, 219–221
109–110, 121, 123–126, 127; technical Asian ODA: distribution of, 153–159, 154;
cooperation aid, 121–122 donors, 161
African Development Bank (AfDB), discus- Asian perspectives, use of term, 10
sion on development effectiveness, 51 Asian recipients, 175–180, 176. See also
aid: controversy, 139–142; distribution of, recipients
115–116, 153–159, 154; Eight Princi- Asian region: and the Arctic, 207–210;
ples of Engagement, 138; evolution of, changes in geopolitics, 67–70, 85–91;
44–46; grant aid, 108, 163; ideologies climate change issues, 189–190;
of, 35–36; and level-playing fields, early perspectives, 81; leadership, 68;
105–106; technical cooperation aid, legitimacy of a development model,
121–122 159; narrative of reciprocity, 160; North
Aid 2.0 paradigm, basis for, 43–44 East donors and South Asia recipients,
aid debate, assumptions of, 38 159–174, 161; post-Cold War era, 87; re-
aid effectiveness. See also development ef- gional trade patterns, 69; role of US, 82
fectiveness, approaches to, 48–52 Asia-Pacific Economic Cooperation
aid recipients, labelling of, 7. See also (APEC), 92–93
recipients Association of South East Asian Nations
alternative aid policies, 45 (ASEAN). See ASEAN (Association of
Annan, Kofi, 226–227 South East Asian Nations)
APEC (Asia-Pacific Economic Coopera- autonomy, calls for, 87
tion), 92–93
APT (ASEAN plus three), formation of, 92 Ban Ki-moon, 226
Arctic, and the Asian region, 207–210 bandwagoning, 71
Index 249
bottom-up approaches, effectiveness of, 43 of, 200–202; international green com-
Brazil. See also BRICs (Brazil, Russia, mitments, 192–193; and IR, 191–192;
India, China), emerging role of, 44 South Korea, 190, 193–197, 196, 197
BRICs (Brazil, Russia, India, China): Delhi climate changes issues, China, 187
Declaration, 14, 51; Development Bank Clinton, Hillary, 89, 94
initiative, 45–46; and Millennium Devel- communication technology, provision of,
opment Goals (MDGs), 14; and SDGs, 42
42; sustainability of resources for ODA, Conferences of the Parties (COPs), 191
15–18; tensions between, 13–14 constructivism, 19–20
Build Transfer Lease (BTL) projects, 228, cooperation, 91–92
230 credibility, domestic, 229–232
Build Transfer Operate (BTO) projects, cultural interpretations, issue of, 5–6
227–228, 230
Busan Partnership for Effective Develop- DAC (Development Assistance Commit-
ment Cooperation, 49–51, 217 tee): major aid recipients, 3; reporting
to, 35
Cambodia, 167–169, 203 DBRs (‘Doing Business Reports’), 226
capacity building, 217 debt cancellation programmes, 105–106
CDM (Clean Development Mechanism) Delhi Declaration, 14, 51. See also BRICs
Projects, 206 (Brazil, Russia, India, China)
cell-phones, provision of, 42 democratisation, economic, 235–237
Charter of Algiers (1967), 21 n3 demographic deficits, 57–58
‘Chimerica,’ 66 Deng Xiaoping, 41, 83, 135
China: aid to Africa, 107, 115–116; and Development Assistance Committee
ASEAN, 87–88, 93–94, 160–163; (DAC): major aid recipients, 3; report-
and Cambodia, 167–169; changes in ing to, 35
geopolitics, 86–87; ‘Chimerica,’ 66; Development Bank initiative, 45–46
China–South Korea Free Trade Agree- development concerns, and poverty, 188
ment (FTA), 94; ‘Chinese dream,’ development effectiveness, 51, 217. See
68; Clean Development Mechanism also aid effectiveness
(CDM) Projects, 206; climate change development model, legitimacy of, 159
issues, 187; demographic deficits, 57; developmentalist model, 69–70
economic growth, 55–56; foreign aid diversity: and geopolitics, 58–59; and hier-
programme history, 137; green growth archical stability, 83; interpretations of,
ODA, 206–207; involvement with local 133; and multipolarity, 12; promotion
communities, 53; and Laos, 171–174; of, 14; versions of, 67
lines of latitude solidarity, 135–136; and ‘Doing Business Reports’ (DBRs), 226
Myanmar, 169–171; National Agenda domestic credibility, 229–232
21, 205; participation in Mauritius, 116; domestic sustainability, 54–57
participation in Somalia, 117; promo- donor-recipient partnerships, criticisms
tion of nationalism, 15; relationship with of, 52
Africa, 133–135; relationship with India, donors. See also Asian donors: Asian, 110–
90–91; relationship with Japan, 88; rela- 112; credibility of, 229–232; effect of
tionship with US, 69, 89–90, 117–127, financial crisis on, 49; non-interference,
120, 122, 123, 127; rise of, 81; single 52; post-colonial, 5; statistics, 154, 161
males living in, 157–158; sovereign
recognition, 128; trade with Taiwan, 90; East Africa, 116–117. See also Africa
and Vietnam, 163–166 East Asia Summit, membership, 10–11
China–South Korea Free Trade Agreement economic crisis of 1997: overview, 155–
(FTA), 94 157; as shared experience, 158–159
Clean Development Mechanism (CDM) economic democratisation, 235–237
Projects, 206 Eight Principles of Engagement, 138
climate change issues: overview, 188; emerging powers: overview, 4–5; and
Africa, 189–190; Asian region, 189–197, globalisation, 36
196, 197; assessments, 207; criticisms environmental rights, 187
250 Index
Ethiopia, ties to South Korea, 129–133 infrastructure system development of, 42
ethnocentrism, danger of, 80 Institute of Sustainable Agriculture and
Community Development (ISAC), 203
financial crisis, effect on DAC donors, 49 international green commitments, 192–193.
Fiscal Conservatives, 36 See also climate change issues
food security, 125–126, 135–136 International Monetary Fund (IMF), World
Foreign Direct Investment (FDI), as a condi- Economic Outlook report (2013a), 47–48
tion for inclusive growth, 37 International Relations (IR): and climate
Free Trade Area of the Asia-Pacific change issues, 191–192; critical ap-
(FTAAP), 92 proaches, 19–20; debate on globalisa-
tion, 91–92; intervention in, 4; non-west-
G8 (Group of Eight), ‘On Africa’ commu- ern, 80–85; perspectives, 18–20, 84; role
niqué, 37 of middle powers, 73–74; state centrism
General Grant Aid (GGA), 163 in, 78–79; state strategies in, 70–74
geoeconomics, 68–70 international system, 84–85
geopolitics: changes in the Asian region, inter-state multipolarity, 160. See also
67–70, 85–91; and diversity, 58–59; and multipolarity
geoeconomic changes, 68–70; and ODA, intervention, forms of, 4
9–10 IR (International Relations). See Interna-
Global Green Growth Institute (GGGI), and tional Relations (IR)
South Korea, 197–200, 203
Global Humanitarian Assistance Develop- Japan: 2012 ODA White Paper, 162, 165,
ment Initiative, 47 166; Abenomics, 155–157; aid to
global institutions, reform of, 44–45 Africa, 107–109, 110, 118–123, 120,
Global Korea, 201–202. See also South 122, 123; anti-colonial role, 132; and
Korea ASEAN, 160–163; calls for autonomy,
global South: as recipients and donors, 87; and Cambodia, 167–169; changes
44–48; solidarity in, 14; strategic choices in geopolitics, 86–87; green growth
for, 54–59 ODA, 204–206; human security agenda,
globalisation: and regionalisation, 91–92; 204–205; Kaizen, 237–239; and Laos,
and the role of emerging powers, 36 171–174; leadership, 68; lines of latitude
grant aid, 108, 163. See also aid solidarity, 136; move toward Abenomics,
green, use of term, 188 155–157; and Myanmar, 169–171; Plaza
green growth agenda. See climate changes Accords (1985), 155–156; and PPPs,
issues 237–239; relationship with China, 88;
grid systems development of, 42 relationship with South Korea, 130–133;
Group of Eight (G8), See G8 (Group of solidarity with India, 130–131; trade pro-
Eight) cess, 92; and Vietnam, 163–166
Japan International Cooperation Agency
hegemon role, 71–72 (JICA), 161–163
hierarchical stability, and diversity, 83
historical ties, as state-led soft power, Kaizen, 237–239
136–139, 138 Kang, David, 82–83
Hu Jintao, 129 Kim, Jim Yong, 39–40
human security agenda, 204–205 Korea International Cooperation Agency
(KOICA), 203–204
IBSA (India, Brazil, South Africa), grouping Krugman, Paul, 157
of, 14 Kyoto Protocol (1997), 192
Ilulissat Declaration, 11
IMF (International Monetary Fund), World Laos, 171–174, 177
Economic Outlook report (2013a), 47–48 leadership, changes in the Asian region, 68
India: relationship with China, 90–91; soli- Lee, Myung-bak, 178–179
darity with Japan, 130–131 level-playing fields concept, 105–106
India–Africa Forum (2011), 139 Lewis turning point, reaching of, 15
Indian Ocean maritime territory, 85–87 liberal approaches, 36
Index 251
liberalism, 18–19, 74–76 NIEO (New International Economic Order),
Liberia, 119–120 46
‘lily pad’ strategy, 90 Non-Aligned Movement (NAM), 13
local communities, involvement with, 53 non-conditionality, emphasis on, 53
Low Income Countries (LICs), 22 n7 ‘non-DAC,’ use of term, 5
non-governmental organisations (NGOs):
Mao Zedong, 81–82 post 2015, 232–235; and PPPs, 231–232
maritime Silk Road, 85–87. See also trade non-interference, maintaining, 52
routes non-western IR, 80–85. See also Interna-
market bottlenecks, use of term, 37 tional Relations (IR)
Marshall Plan, 4 North Korea, recognition by South Korea,
Marxism, 19–20 129–133
Mauritius, China’s participation in, 116 Nye, Joseph, 176
McNamara, Robert, 21 n3
middle classes, characteristics of, 158 Obama, Barack, 174–175
middle powers, role in IR, 73–74 OECD-DAC (Organisation for Economic
MIKTA (Mexico, Indonesia, South Korea, Cooperation and Development, Develop-
Turkey, Australia), 15 ment Assistance Committee): member-
Millennium Development Goals (MDGs): ship, 5; role of, 35
2013 report, 2; and BRICs, 14; evalua- Official Development Assistance (ODA):
tion of, 37–42; post 2015, 17–18, 45 overview, 1; criticisms of, 52–54; and
Ministry of Foreign Affairs (MOFA): human geopolitics, 9–10; ‘green growth’ influ-
security agenda, 204–205; and South enced, 202–204; major aid recipients,
Korea, 194 47; sustainability of resources for, 15–18
Montevideo Treaty (1933), 21 n4 otherness, hierarchies of, 223–224
multipolarity: shift to, 11–12; use of term,
160 ‘Panamax’ ports, 118. See also trade
Myanmar, 169–171, 174–175, 177–178 PCGG (Presidential Committee on Green
Growth), 198
NAM (Non-Aligned Movement), 13 Plaza Accords (1985), 155–156
National Agenda 21, 205 port access, 118. See also trade
national autobiography, 6–7 post-colonial donors, 5. See also donors
National Council on Green Growth poverty: definitions of, 34; and development
(NCGG), 203 concerns, 188; distribution of, 44; im-
‘national grid’ infrastructure system devel- ages of, 36–37
opment of, 42 power. See also soft power, and security,
national identity: changes in, 222–225; issue 70–71
of, 5–6 Presidential Committee on Green Growth
nationalism, promotion of, 15 (PCGG), 198
natural resources: lack of, 106; shared expe- project support, emphasis on, 53
rience of, 163 public and private partnerships (PPPs): con-
NCGG (National Council on Green text of, 225–227; defining, 227–229; and
Growth), 203 Japan, 237–239; and NGOs, 231–232
neoliberal economics, 35–36 public opinion, changes in, 222–225
neo-Marxist perspectives, 19
New Delhi Declaration. See Delhi Declara- realism, 18–19, 71–72
tion recipients. See also Asian recipients: label-
New International Economic Order (NIEO), ling of, 7; statistics, 3, 47, 154
46 reciprocity, narrative of, 160
new regionalism, emergence of, 67 regimes, and cooperation, 75–76
new village movement (saemaul undong), regional geopolitics. See geopolitics
235–237 regional trade, growth of, 69
newness, issue of, 5–6 regionalisation, and globalisation, 91–92
Next-11: geopolitics and diversity of, 58–59; reverse coupling, 67
membership, 15 RISING, 113–114. See also Africa
252 Index
Rudd, Kevin, 159 74–76; and soft power, 76–78; system
of, 84–85
saemaul undong (new village movement), ‘Supermax’ ships, 118. See also trade
235–237 sustainable development, 186
SDGs (sustainable development goals), and sustainable development goals (SDGs), and
BRICs, 42 BRICs, 42
security, food, 125–126, 135–136 system of states, 84–85
security, human, 204–205
security dilemma, 70–71 Taiwan, trade with China, 90
self-labelling, of aid recipients, 7 technocracy, increasing, 39–40
Senegal, food security, 135–136 Third World solidarity movements, 13–15,
shared experiences: narrative of the Asian 46–48, 47
donors, 158–159; natural disasters, 163; top-down approaches: criticisms of, 231;
returning, 224–225 effectiveness of, 43
shipping routes. See trade routes trade: port access, 118; regional, 69
Skidelsky, Robert, 220 trade routes, 10–11, 85–87, 207–210
social constructivist approaches, 19 Trans-Pacific Partnership (TPP) initiative,
soft power: promotion of, 70; state-led, 69
76–78, 136–139, 138 Trans-Pacific Strategic Economic Partner-
solidarity movements, Third World, 13–15, ship Agreement (TPSEPA), 94
46–48, 47
Somalia: China’s participation in, 117; UN Human Development Report (2013), 46
experiences in, 86 UN Millennium Declaration, 39
South Korea: aid by, 41; aid to Af- United Nations Conference on Trade and
rica, 109–110, 121, 123–126, 127; and Development (UNCTAD), 13
ASEAN, 88–89; and Asian recipients, United Nations Convention on the Law of
175–180, 176; calls for autonomy, 87; the Sea (UNCLOS), 11
changes in geopolitics, 86–87; China– United States: and Myanmar, 174–175;
South Korea Free Trade Agreement Plaza Accords (1985), 155–156; relation-
(FTA), 94; climate change issues, 190, ship with China, 69, 89–90, 117–127,
193–197, 196, 197; critics of green 120, 122, 123, 127; role in Asian region,
growth, 200–202; domestic tensions, 82
155–157; and the GGGI, 197–200; ‘unlocking’ market bottlenecks, use of term,
Global Korea, 201–202; green growth 37
agenda, 187; and Laos, 177; leadership,
68; Lee, Myung-bak, 178–179; and My- Vietnam, 163–166
anmar, 177–178; new village movement
(saemaul undong), 236; recognition of Washington Consensus, emergence of,
North Korea, 129–133; relationship with 35–36
Japan, 130–133; and shared experiences, World Bank: 2006 World Development
224–225; shipping routes, 86; ties to Report, 2; ‘Doing Business Reports’
Ethiopia, 129–133 (DBRs), 226; and technocracy, 39–40
sovereignty: recognition of, 128; respect for, World Economic Forum (WEF), 201
52; role of, 12
states: centrism in IR, 78–79; IR strate- Xi Jinping: and ‘the Chinese dream,’ 68; and
gies, 70–74; relationship between, 3–4, historical ties, 136