The resurgence of the COVID-19 is weighing on the recovery of vulnerable economies throughout the developing world, particularly those economies relying on tourism and exports. Given their low vaccination rates and weak financial ability, many developing economies are now falling further behind, with a larger proportion of the population pushed into extreme poverty.
Promoting economic recovery in those economies is a moral responsibility for the international community. In a globalized market, to help them out of the woes has a close bearing to the economic stability of the whole world.
However, the traditional aid-providing countries – mainly developed countries – also suffer lingering fallout from the pandemic, which has largely weakened their capacity and willingness to provide assistance.
For developed countries, with domestic economic downturn and surging unemployment, to maintain influence over developing countries, they have to resort to issue more debts to raise funds. This is bound to lead to surging debts and is one of the reasons why Western countries are hyping up the “debt trap theory” against China.
In fact, while launching smearing campaign against China, Western countries are actually creating more debts for themselves.
In the face of such a severe global financial crunch, China’s foreign aid inevitably shoulders greater expectations. While the US, the largest economy, has been increasingly taking a US-centric approach in international affairs now, emerging aid-providers such as China are actually making more contribution.
As the largest contributor to the G20 Debt Suspension Initiative, China has written off matured interest-free loans for 15 African countries.
Amid rising geopolitical rivalry of the US-led Western camp, each action of China could easily become the target of Western politicians. Facing a devastating pandemic, instead of smearing and attacking China out of geopolitical calculation and zero-sum thinking, Western countries should abandon their protectionism and focus on jointly stabilizing the global economy through multilateral cooperation.
How to effectively help developing countries realize economic recovery in the post-COVID era? Debt relief is only a transitory measure, and only by exploring innovative ways to achieve sustainable development can problems including poverty be solved in developing countries.
First, major economies in the world should explore more innovative ways and further promote sharing of governance experiences in aiding poor developing countries. China’s successful experience of governance has been broadly welcomed by the developing countries, and China also has the willingness to contribute its successful governance experience to the world.
As China does not attach any political conditions in assistance and respects the recipients’ own choice in setting independent development pathways, its assistance should not be impacted by political attacks from the West. China’s development experiences in reforms are well suited to the development needs of developing countries and of great significance to global economic stabilization.
Second, the world needs to shift assistance model and strengthen assistance efforts through trade exchanges. According to the white paper “China’s Foreign Aid” published in 2021, grants – one of the three types of China’s assistance to other countries – account for nearly 50 percent China’s total foreign assistance. It’s not realistic for China continues to expand aid gratis. Fundamentally, the debt issue of developing countries is also a development issue. Only through activating the economic growth in recipient countries, the debt issue could be resolved.
In the context of globalization, trade is the most effective way to increase the allocation of resources. With a huge market potential, China could offer assistance to developing countries through trade and share the market dividends to broad developing countries, so as to accelerate factor mobility among developing countries, increase productivity, and promote sustained growth.
The author is an associate research fellow at the Chinese Academy of International Trade and Economic Cooperation. bizopinion@globaltimes.com.cn
A staff member unloads Chinese medical supplies from an airplane at the Kotota International Airport in Accra, capital of Ghana. Photo: Xinhua
