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China's Role in Global Development Finance: China Challenge or Business as Usual?

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  • Salvatore Babones
  • John H.S. Åberg
  • Obert Hodzi

Abstract

China's economic success has prompted both academic political economists and applied policy analysts to speculate about the implications of a new ‘China model’ of economic development and global economic governance. A particular issue is the degree to which the China model involves developing in opposition to or in cooperation with the pre‐existing norms of global economic governance. Recognizing the ambiguity of the China model, we consider two alternative interpretations of China's role in global economic governance: China Challenge (CC) and Business as Usual (BaU). We flesh out these contrasting interpretations using evidence from the lending behavior of four major development finance institutions in which China plays a leading or determinative role: the Asian Infrastructure Investment Bank (AIIB), the New Development Bank (NDB), the Silk Road Fund (SRF), and the China‐Africa Development Fund (CADF) of the China Development Bank. We find that (at least in the restricted domain of international development finance) China's role in global economic governance is largely characterized by BaU behavior, and although on a regional level this does represent a challenge to the historical role of Japan, it nonetheless suggests that the China model is not so revolutionary as many analysts suppose.

Suggested Citation

  • Salvatore Babones & John H.S. Åberg & Obert Hodzi, 2020. "China's Role in Global Development Finance: China Challenge or Business as Usual?," Global Policy, London School of Economics and Political Science, vol. 11(3), pages 326-335, May.
    • Handle: RePEc:bla:glopol:v:11:y:2020:i:3:p:326-335
    DOI: 10.1111/1758-5899.12802
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    1. Marcin Gornikiewicz & Jaroslaw Zelkowski, 2020. "Belt and Road Initiative in the Age of COVID-19 Pandemic: Implications for the Development of the Strategic Project of the People’s Republic of China," European Research Studies Journal, European Research Studies Journal, vol. 0(Special 3), pages 302-310.

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