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A Promising New Trend? Factors Driving China's Growing Trilateral Aid Cooperation

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A Promising New Trend? Factors Driving China's Growing Trilateral Aid Cooperation A Promising New Trend? Factors Driving China’s Growing Trilateral Aid Cooperation Denghua Zhang PhD Candidate A thesis submitted for the degree of Doctor of Philosophy of The Australian National University State, Society & Governance in Melanesia Program Coral Bell School of Asia Pacific Affairs The Australian National University March 2017 Statement of Originality The work presented within this thesis was performed in the Department of Pacific Affairs, Coral Bell School of Asia Pacific Affairs at The Australian National University. The research was carried out from March 2013 to March 2017 under the supervision of Associate Professor Sinclair Dinnen, Dr. Graeme Smith, Professor Katherine Morton, Professor Michael Leach and Dr. Stewart Firth. I declare that the work presented in this thesis is, to the best of my knowledge, original. Furthermore, this work has not been submitted either whole or in part, for a degree at this or any other university (except where acknowledged in the text). Denghua Zhang Table of Contents List of Figures and Tables v Acronyms vi Glossary of Chinese Terms viii Preface and Acknowledgements ix Abstract xi CHAPTER ONE. Introduction 1 1. Chinese foreign aid 5 2. Research question: Chinese trilateral aid cooperation 11 3. Research gap and contributions of this thesis 15 4. Main argument 19 5. Thesis structure 19 CHAPTER TWO. Conceptualising Chinese Aid Motivations 23 1. Literature review 23 2. Conceptual framework 34 3. Conclusion 50 CHAPTER THREE. China’s foreign aid and trilateral cooperation—interest calculations, international engagement and domestic institutions 51 1. Introduction 51 2. Interest calculations and China’s trilateral aid cooperation 52 3. International engagement 63 4. Domestic institutions 78 5. Reactions of China’s main aid agencies to trilateral aid cooperation 95 6. Conclusion 98 CHAPTER FOUR. The UNDP as a catalyst for China’s development cooperation —The case of China–UNDP–Cambodia trilateral cassava project 101 1. Introduction 101 2. China–UNDP engagement on development cooperation 102 3. Evolving trends in aid to Cambodia 117 4. Conclusion 135 CHAPTER FIVE. Peaceful co-existence in the Pacific— China–Australia–Papua New Guinea trilateral malaria project 137 1. Introduction 137 2. China and Australia engagement on development cooperation 138 3. China–Australia–PNG trilateral project on malaria control 159 4. Conclusion 171 CHAPTER SIX. A tango by two superpowers—China–US–Timor-Leste trilateral cooperation on food security 175 1. Introduction 175 2. China–US engagement on development cooperation 176 3. Evolving trends in aid to Timor-Leste 192 4. China–US–Timor-Leste trilateral project on food security 196 5. Conclusion 204 CHAPTER SEVEN. Assessing China’s trilateral aid cooperation and foreign aid reform 207 1. Overview of China’s trilateral aid cooperation 207 2. Assessment of trilateral cooperation 217 3. Chinese aid reform and trilateral cooperation 223 4. Conclusion 231 CHAPTER EIGHT. Conclusion 233 1. IR theories and aid 233 2. Trilateral cooperation and foreign policy 238 3. Scope for future research 240 REFERENCES 243 iv List of Figures and Tables Figures 1. Top ten donors globally over the period 2010–2012, USD billion 7 2. Process tracing Chinese trilateral aid cooperation 46 3. International reports on China’s foreign aid 58 4. Domestic reports on China’s foreign aid 59 5. China’s changing identity, interest calculations and aid modality preferences 62 6. China’s foreign aid evolution and five crucial time points 64 7. China’s aid decision-making procedure 93 8. The top ten donors in Cambodia in 2015, USD million 117 9. Chinese aid to Cambodia over the period 2009–2015, USD million 119 10. Timeframe of the China–UNDP–Cambodia trilateral project 120 11. Project training manual for farmers (pp. 1 and 5) 124 12. China’s infrastructure concessional loans projects in Cambodia by value 128 13. China’s infrastructure concessional loans projects in Cambodia by percentage 128 14. Australian bilateral aid to China over 1997–2013, million AUD 139 15. Trade between PNG and China over 2001–2012, million kina 151 16. Chinese concessional loans to PNG over 2012–2015, million kina 154 17. Chinese grant aid to PNG over 2006–2015, million kina 154 18. Australian aid to PNG over 2001–2015, million AUD 156 19. Timeline for the China–Australia–PNG trilateral malaria project 162 20. Interviewees’ reactions to trilateral aid cooperation 171 21. Interviewees’ perception on preconditions for trilateral cooperation 171 22. Chinese aid to Timor-Leste, USD 194 23. Roadmap of analysis 236 Tables 1. Chinese trilateral aid projects 14 2. Case selection variables in this research 42 3. A breakdown of my interviews 48 4. Research transparency in this project 48 5. Interest-based alliance propensity of Chinese aid agencies 79 6. Status of three ministries in China’s political system 81 7. Attitudes of China’s aid agencies towards trilateral cooperation 95 8. UNDP’s development assistance to China over 1979–2015 106 9. China–UNDP Trilateral aid projects 115 10. Summary of China’s aid projects in Cambodia 119 11. Diplomatic landscapes of Mainland China and Taiwan in the Pacific region 150 12. Examples of Chinese concessional loan projects in PNG 154 13. Main stakeholders in the China–Australia–PNG trilateral malaria project 160 14. US aid (grant) projects in Timor-Leste over 2005–2015 193 15. Chinese aid (grant) projects in Timor-Leste over 2006–2015 194 v Acronyms AAP Australia Associated Press ADB Asian Development Bank AIBO Academy for International Business Officials AIIB Asian Infrastructure Investment Bank APMEN Asia Pacific Malaria Elimination Network APSC Australia Public Service Commission ASEAN Association of Southeast Asian Nations AusAID Australian Agency for International Development BRICS Brazil, Russia, India, China and South Africa CAITEC China Academy of International Trade and Economic Cooperation CASS China Academy of Social Sciences CATAS China Academy of Tropical Agricultural Sciences CCIEE China Centre for International Economic Exchange CCPIT China Council for the Promotion of International Trade CDC Council for the Development of Cambodia CFPA China Foundation for Poverty Alleviation CHEC China Harbour Engineering Corporation CICETE China International Centre for Economic and Technical Exchanges CICIR China Institutes of Contemporary International Relations CNN Cable News Network CPC Communist Party of China CPHL Central Public Health Laboratory DAC Development Assistance Committee DFA Department of Foreign Aid DFAT Department of Foreign Affairs and Trade DFID Department for International Development DITEA Department of International Trade and Economic Affairs DNPM Department of National Planning and Monitoring ECOSOC Economic and Social Council FAO Food and Agriculture Organization FOCAC Forum on China-Africa Cooperation GDP Gross Domestic Product HHISP Health and HIV Implementation Services Provider IMR Institute of Medical Research IPRCC International Poverty Reduction Centre in China MAF Ministry of Agriculture and Fisheries MAFF Ministry of Agriculture, Forestry and Fisheries MCA Ministry of Civil Affairs MDG Millennium Development Goals MFA Ministry of Foreign Affairs MoA Ministry of Agriculture MOFCOM Ministry of Commerce vi MoF Ministry of Finance MOU Memorandum of Understanding NDH National Department of Health NHFPC National Health and Family Planning Commission NIPD National Institute of Parasitic Diseases NPC National People’s Congress ODA Official Development Assistance OECD Organisation for Economic Co-operation and Development PNG Papua New Guinea PRC People’s Republic of China SASAC State-owned Assets Supervision and Administration Commission SDG Sustainable Development Goals S&ED Strategic & Economic Dialogue SOE State-owned Enterprise TT-SSC Task Team on South-South Cooperation UNDP United Nations Development Programme UNIDO United Nations Industrial Development Organization UNTL National University of East Timor US United States USAID United States Agency for International Development WHO World Health Organization WTO World Trade Organization vii Glossary of Chinese Terms Transcription of Chinese characters into the Roman alphabet follows the pinyin system. guikou danwei point of contact hexin liyi core interests hongyi rongli uphold justice and pursue shared interests jiang zhengzhi talk politics jianshe hexie shijie build a harmonious world qinghao annual wormwood (Artemisia annua) shishi qiushi, liangli erxing be practical and act within one’s capacity tao guang yang hui hide the capacity and keep a low profile xiaokang shehui a moderately prosperous society yijing cuzheng use economics to promote politics yili xiangjian, yili weixian take a right approach to justice and interests by prioritising justice over interests you ji you qu to take while giving you suo zuo wei make greater achievements zhanlue jiyuqi period of strategic opportunities zhengjing jiehe combine politics and economics zhengque yiliguan right concepts of justice and interests zhengzhi gua shuai politics takes command zhengzhi politics zili gengsheng self-reliance zouchuqu zhanlue go global strategy viii Preface and Acknowledgements I would like to take this opportunity to briefly introduce my positionality in this research program. The idea emerged when I was working as a diplomat in the Pacific region between 2006 and 2011. I was puzzled by the lack of development in the island countries despite their endowment of fishery resources and a large inflow of foreign assistance. I also
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