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Chinese overseas development funds: An assessment of their sustainability approaches

Author

Listed:
  • Mathias Lund Larsen

    (CBS - Copenhagen Business School [Copenhagen])

  • Tancrède Voituriez

    (UMR ART-Dev - Acteurs, Ressources et Territoires dans le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - UPVM - Université Paul-Valéry - Montpellier 3 - UPVD - Université de Perpignan Via Domitia - CNRS - Centre National de la Recherche Scientifique - UM - Université de Montpellier, Cirad-ES - Département Environnements et Sociétés - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement, IDDRI - Institut du Développement Durable et des Relations Internationales - Institut d'Études Politiques [IEP] - Paris)

  • Christoph Nedopil

    (UCAS - University of Chinese Academy of Sciences [Beijing] - CAS - Chinese Academy of Sciences [Beijing])

Abstract

A growing number of emerging economies receive significant parts of their overseas finance and investment from Chinese state-owned or state-linked institutions. While academic research has focused on how Chinese policy and state-owned banks approach sustainable development issues, Chinese sovereign-backed overseas development funds are a critical yet overlooked component. This paper addresses this knowledge gap by providing the first comprehensive overview of such funds regarding their scope, activities and capitalization, as well as by assessing the funds' policy approach to sustainability. Qualitative and quantitative data are collected from databases, funds' websites, newspaper articles and public statements in both Chinese and English to identify common features between funds and to analyse their sustainability policies in comparison with global best practices. The paper specifically analyses the funds' sustainability approaches rather than impact due to a lack of comprehensive data on the funds' investments. First, the paper finds that given their number, announced capital size of US$213 billion, geographic scope and sectorial focus, including on high-emissions projects such as mining, energy and heavy industry, the funds are influential players in global development finance. Second, regarding the funds' approaches to sustainability, the paper finds that the funds lack transparency about their policies and practices,

Suggested Citation

  • Mathias Lund Larsen & Tancrède Voituriez & Christoph Nedopil, 2023. "Chinese overseas development funds: An assessment of their sustainability approaches," Post-Print hal-04052167, HAL.
    • Handle: RePEc:hal:journl:hal-04052167
    DOI: 10.1002/jid.3778
    Note: View the original document on HAL open archive server: https://agroparistech.hal.science/hal-04052167v1
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    References listed on IDEAS

    as
    1. Irene Monasterolo & Jiani I. Zheng & Stefano Battiston, 2018. "Climate Transition Risk and Development Finance: A Carbon Risk Assessment of China's Overseas Energy Portfolios," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 26(6), pages 116-142, November.
    2. Kelly Sims Gallagher & Qi Qi, 2021. "Chinese Overseas Investment Policy: Implications for Climate Change," Global Policy, London School of Economics and Political Science, vol. 12(3), pages 260-272, May.
    3. Mathias Lund Larsen, 2022. "Driving Global Convergence in Green Financial Policies: China as Policy Pioneer and the EU as Standard Setter," Global Policy, London School of Economics and Political Science, vol. 13(3), pages 358-370, June.
    4. Li, Zhongshu & Gallagher, Kevin P. & Mauzerall, Denise L., 2020. "China's global power: Estimating Chinese foreign direct investment in the electric power sector," Energy Policy, Elsevier, vol. 136(C).
    Full references (including those not matched with items on IDEAS)

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    Keywords

    investment funds; china; Sustainability;
    All these keywords.

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