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Donor nations ask why China gets billions in aid each year

Posted by Author on September 26, 2010

Detroit Free Press – Gillian Wong – ‎Sep 26, 2010‎ –

BEIJING — China  spent tens of billions of dollars on a dazzling 2008 Olympics. It has sent astronauts into space. It recently became the world’s second-largest economy.

Yet it gets more than $2.5 billion a year in foreign government aid — and, increasingly, taxpayers and lawmakers in donor countries are asking why.

With the global economic slowdown crimping government budgets, many countries are finding such generosity politically and economically untenable. China says it’s still a developing country in need of aid, while some critics argue that the money should go to poorer countries.
In recent months, Germany and Britain moved to reduce or phase out aid. Japan, long China’s biggest donor, halted new low-interest loans in 2008.

Aid to China from individual donor countries averaged $2.6 billion a year in 2007-08, according to the latest figures available from the Organization for Economic Cooperation and Development.

Ethiopia, where average incomes are 10 times smaller, got $1.6 billion, although measured against a population of 1.3 billion, China’s share of foreign aid is smaller than most.

Iraq got $9.5 billion and Afghanistan $3.5 billion.

Today’s aid adds up to $1.2 billion a year from Japan, followed by Germany, at about half that amount, then France and Britain.

Aid from the U.S.

The U.S. gave $65 million in 2008, mainly for programs promoting safe nuclear energy, health, human rights and disaster relief. The reason the U.S. gives so little is because it still maintains the sanctions imposed following the 1989 military crackdown on pro-democracy demonstrators, said Drew Thompson, a China expert at the Nixon Center in Washington, D.C.

Detroit Free Press

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