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Asian versus Western Modes of Foreign Aid

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Abstract

The first chapter provides the framework for the book. While most analysts focus on the differences between traditional and emerging donors, we argue that a more important distinction is between East Asian donors and their Western counterparts. Asian donors—Japan, South Korea, and China—demonstrate a particular approach to aid that draws on their own developmental successes. The first section of the chapter reviews the literature on traditional (Western), emerging, and Asian donors and introduces a set of propositions that will be examined in the book. The second presents data on aid flows from East Asian and Western donors. The third focuses on differences between East Asian aid to recipients in the Asian region itself and elsewhere, especially in Sub-Saharan Africa. The final section previews the rest of the book.

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Notes

  1. 1.

    Lancaster (2007a) discusses some antecedent organizations. This book is the best source of information on the historical development of international aid.

  2. 2.

    The International Monetary Fund (IMF), often referred to as the World Bank’s twin, was never meant to be an aid agency but rather one that would serve to maintain balance of payments and exchange rate equilibrium.

  3. 3.

    This definition is in the process of being changed. The data in this book are based on the old definition.

  4. 4.

    Former DAC Chairman Richard Manning (2006) provided a typology of non-DAC donors that demonstrates these distinctions: (1) non-DAC OECD members, (2) non-OECD EU members, (3) OPEC and Arab states, and (4) others. Walz and Ramachandran (2011) offered an alternative: (1) DAC-like countries, (2) Arab countries, and (3) Southern countries.

  5. 5.

    A large literature exists on the developmental state. Most authors attribute the term to Chalmers Johnson (1982) in his analysis of Japan’s Ministry of International Trade and Industry (MITI). Extensive analyses followed of Korea (e.g., Amsden 1989) and Taiwan (e.g., Wade 1990). A useful review is Stubbs (2009).

  6. 6.

    See the discussion of the “trinity” in Shimomura and Wang (2013). As we will discuss in Chapter 4, some scholars say that the trinity was one of the main aspects of Japanese aid that was of interest to the Chinese.

  7. 7.

    A useful document in tracing the evolution of DAC procedures is OECD (2006); since 2006, information can be found on the DAC website. This section draws on the 2006 document.

  8. 8.

    To give an idea of the change (or lack thereof), the OECD reports that total net ODA from DAC member countries for 2014 was US$ 137.2 billion. Since there are now 28 DAC members, rather than 23 as in 2010, the average per donor fell to US$4.9 billion. The ODA/GNI ratio also fell slightly to 0.30.

  9. 9.

    Walz and Ramachandram include Chile in the group of southern donors, but it is better categorized as a DAC-like donor. It is a member of the OECD and generally follows Western norms.

  10. 10.

    See also Mawdsley (2012), who makes a similar analysis of emerging donors.

  11. 11.

    More recent examples of similar criticisms are found in Chandy (2012) and Coleman (2013).

  12. 12.

    On Japanese foreign aid, see Yasutomo (1986), Orr (1990), Rix (1993), Arase (1995, 2005), Katada (2005, 2013), Lancaster (2007a, Chap. 4), Sato and Shimomura (2013), Kato et al. (2016).

  13. 13.

    On Korean aid, see Kwon (2006), OECD (2008a, 2012a), Kim (2011a), Kim and Oh (2012), Kondoh (2013), Kim and Kim (2014a).

  14. 14.

    On Chinese ODA, see Hubbard (2007), Lancaster (2007b), Li (2008), Lum et al. (2008), Lum et al. (2009), Brautigam (2011), China State Council (2011, 2014), Shimomura and Ohashi (2013), Zhou et al. (2015), Kitano (2016).

  15. 15.

    Other shareholders in the top ten are Pakistan (#4), India (#5), Australia (#6), Indonesia (#7), Canada (#9), and Germany (#10).

  16. 16.

    The ADF and OCR will be combined in 2017, increasing funds available to the poorest countries.

  17. 17.

    On the Asian Development Bank, see Yasutomo (1983), Kappagoda (1995), Wan (1995), Kilby (2006, 2011), ADB (2007a, b, 2008), Rauniyar and Kanbur (2010).

  18. 18.

    For other discussions of the distinct characteristics of Asian donors, see Jerve (2007); Jerve, Shimomura, and Hansen (2008); Soderberg (2010); Shimomura and Wang (2013).

  19. 19.

    We use the data for 2012 because, as will be explained shortly, the East Asian share for East Asian recipients rose strongly in 2013, when Japan and the ADB gave a large volume of aid to Myanmar. Thus the 2012 data better reflect trends in the recent past and provide a conservative bias against our propositions. When appropriate, we contrast 2012 to 2013 (the most recent data available at the timing of writing).

  20. 20.

    A recent official source indicated that nearly 52 percent of Chinese funds go to Sub-Saharan Africa (China State Council 2014). We estimate that about 20 percent goes to East Asia—although this excludes large amounts to North Korea (Reilly 2014). A more extensive discussion of Chinese data is provided in Chapter 4.

  21. 21.

    For a study of Asian versus non-Asian recipients in the case of Japan, see Ohno (2010).

  22. 22.

    The multilateral share is “imputed multilateral channels.” The methodology can be found on the DAC website: http://www.oecd.org/dac/stats/oecdmethodologyforcalculatingimputedmultilat

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Authors and Affiliations

  1. Watson Institute for International and Public Affairs, Brown University, Providence, Rhode Island, USA

    Barbara Stallings

  2. Graduate School of International Studies, Ewha Womans University, Seoul, Korea (Republic of)

    Eun Mee Kim

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  1. Barbara Stallings
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  2. Eun Mee Kim
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Stallings, B., Kim, E.M. (2017). Asian versus Western Modes of Foreign Aid. In: Promoting Development. Development Cooperation and Non-Traditional Security in the Asia-Pacific. Palgrave, Singapore. https://doi.org/10.1007/978-981-10-3165-6_1

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