Research On The Economic And Social Effects Of China’s Aid To African Countries

China’s aid to African countries began in the mid-1950 s and has always been an important part of China-Africa relations.As the largest developing country in the world,China’s experience as an aid recipient and its success in rapid economic transformation and poverty reduction are strong attractions for African countries.The Forum on ChinaAfrica Cooperation(FOCAC)organized in 2000 has provided a long-term and sustained institutional platform for China’s aid to Africa.Since then,the Chinese government has put forward a series of new assistance policies to Africa,which has both enriched its content and expanded its field,and both the mode and management have been optimized.Through those effective actions,China’s aid to Africa has facilitated the sharing of development experience between China and Africa,and strongly supported the economic growth and social development of African countries.It is an important achievement of China’s commitment to South-South cooperation and the basis for China-Africa production capacity cooperation under the Belt & Road Initiative.However,the international community has always questioned and misunderstood the effects of China’s aid to Africa,believing that China’s aid to Africa has not helped African countries to achieve economic growth,but has reduced their development prospects.Therefore,a comprehensive assessment of the economic and social effects of China’s aid to Africa can not only enable the international community to objectively understand the effectiveness of China’s aid to Africa,but also effectively respond to the false accusations against China’s aid to Africa,and thus provide empirical support for China’s further aid to Africa.Therefore,this paper studies the economic growth effect and social development effect of China’s aid to Africa under the framework of the social and economic effects,and comprehensively examines the impact of China’s aid on the economic growth,poverty reduction effects and regional economic inequality of African countries.This paper consists of nine chapters,which are divided into four parts.First of all,the first three Chapters are the research basis of this paper.The first chapter is the introduction,which summarizes the background,significance,structure,research methods,and innovations of this paper.The second chapter is a review of relevant research at home and abroad.It summarizes the existing research on the effect of aid on economic growth,poverty reduction and economic inequality in recipient countries,which lays the theoretical basis for the analysis of this paper and points out the direction of empirical research.The third chapter reviews the objective facts of China’s aid to Africa in different historical stages to provide intuitive cognition for the follow-up research of this paper.Secondly,the economic growth effect of China’s aid to Africa is studied from Chapter Four to Chapter Six step by step.In Chapter Four,on the basis of extracting,correcting and integrating the night light data of African countries,the correlation between China’s aid to Africa and the economic growth of African countries is preliminarily studied.In Chapter Five,an endogenous growth model including aid is established to reveal the role of aid in promoting economic growth and residents’ welfare of recipient countries,and the panel data of African countries are selected for empirical test.In Chapter Six,the simultaneous influence of China’s aid to Africa and African countries’ economic growth is included into the dynamic simultaneous equations,which further reveals the dynamic relationship between the two.Thirdly,Chapters Seven and Eight study the social development effect of China’s aid to Africa in parallel separately.Chapter Seven,on the basis of introducing the poverty status of African countries,examines the poverty reduction effects and threshold effects of China’s aid to Africa,and Chapter Eight evaluates the status quo of regional economic inequality in African countries and analyzes the impact of Chinese aid on them.Finally,Chapter Nine summarizes the conclusions of this paper,puts forward policy recommendations and prospects for future research.Based on the combination of theoretical analysis and empirical research,the main research conclusions of this paper are as follows:Firstly,this paper verifies the authenticity of African countries’ economic growth through the night light data.On this basis,the panel vector autoregressive model is established to confirm that there is a positive correlation between China’s total aid to Africa and different types of aid and the economic growth of African countries.In addition,China’s aid has a lagging effect on the economic growth of African countries,and the economic situation of recipient countries will also affect the allocation of aid funds to varying degrees.On the one hand,it shows that China’s aid will have a longterm impact on African countries,and on the other hand,it also reveals the possible two-way causality between aid and economic growth.Secondly,on the basis of verifying the correlation between aid and economic growth and constructing the theoretical model that aid affects the economic growth of recipient countries,this paper overcomes the endogenous problem of aid and comes to the conclusion that China’s total aid to Africa significantly promotes the economic growth of African countries and the improvement of residents’ welfare,but there is some heterogeneity in the impact of different types of aid.For example,although nontransfer aid can increase the proportion of public expenditure in African countries,promote their use of capital-saving technologies,and thus promote their economic growth,its impact on residents’ welfare level is inverted U-shaped;public spending aid can directly promote the economic growth of African countries and improve the welfare of their residents.In addition,the panel quantile regression results also show that the impact of China’s aid on African countries with different economic growth levels is heterogeneous.In particular,for those African countries with relatively high levels of economic growth,China’s aid has the greatest impact on their economic growth.Thirdly,on the basis of the above research,this paper further uses the linear dynamic simultaneous equations to depict the dynamic relationship between aid and economic growth of the recipient countries,and uses the extension of the dynamic panel system of generalized moment estimation method for joint estimation.And it is verified that on the one hand,the total aid of China can promote economic growth in African countries;on the other hand,the economic growth of African countries will further attract the inflow of Chinese aid funds.The conclusion remains true after distinguishing different types of Chinese aid to Africa.By further using the panel structure vector autoregressive model,it is found that the dynamic relationship between China’s total aid to Africa and the economic growth of African countries has formed a positive feedback loop,and its impact is progressive and expands in an accumulative manner.Fourthly,this paper examines the poverty reduction effects of China’s aid to Africa on the basis of the research on the welfare effect of China’s aid to Africa.It is found that China’s aid to Africa helps to improve the poverty reduction effect of African countries on the whole,and the effect of China’s aid to sub-Saharan Africa and heavily indebted countries in Africa is more significant,which indicates that China’s aid to Africa has a strong pro-poverty effect.Different types of aid have different effects on poverty reduction.The aid to government departments and social infrastructure is working better than the aid to economic infrastructure and production sectors.Also,with the continuous development of China’s aid to Africa,for some African countries receiving a large amount of Chinese aid,the effect of aid on poverty reduction shows a marginal diminishing trend.In addition,China’s aid is in competition with that of other countries,which weakens the effect of its aid on poverty reduction.Fifthly,on the basis of the above theoretical model,this paper includes the issue of regional economic inequality in recipient countries.Through empirical research,it is found that both China’s total aid to Africa and China’s Official Development Assistance(ODA)to Africa can significantly reduce the level of regional economic inequality in recipient countries.The transfer payment aid and public expenditure aid in the total aid can also help to narrow the gap between the relatively poor and relatively rich areas in the recipient countries,but Other Official Financing(OOF)projects will cause economic agglomeration,thus increasing the regional economic inequality in the recipient countries.Taking sub-Saharan African countries and heavily indebted countries in Africa as samples,and it is found that China’s aid can still reduce their regional economic inequality.This further shows that China’s aid to Africa is pro-poor.Therefore,when further assisting Africa,the Chinese government should consider appropriately expanding the scale and intensity of China’s aid,and at the same time pay attention to adjusting the allocation of different types of aid to optimize the aid effect.Meanwhile,the Chinese government should focus on strengthening exchanges and cooperation with traditional donor countries and international organizations,increase the level of information disclosure on foreign aid,and actively promote the transformation and upgrading of China’s foreign aid to international development cooperation.In this way,China’s aid to Africa can not only better serve China’s national interests,but also bring strong impetus to the economic and social development of African countries.