China Regains Second-Largest Aid Donor Status in Pacific
China Regains Second-Largest Aid Donor Status in Pacific

China Regains Second-Largest Aid Donor Status in Pacific

News summary

China has regained its position as the second-largest bilateral donor to the Pacific Islands, surpassing the United States, as reported by the Lowy Institute's Pacific Aid Map. In 2022, China's aid spending rose to $256 million, marking a 6% increase despite an overall decline in development finance for the region by 18%. This resurgence follows a pandemic-induced lull and reflects a shift towards a more politically targeted aid strategy that includes direct government budget transfers. China's renewed focus on infrastructure projects, such as the $135 million Vanua Levu Road Upgrade in Fiji, has raised concerns regarding 'debt trap diplomacy'. Australia remains the largest donor, contributing $1.5 billion, but the dynamics of aid distribution in the Pacific are shifting. Overall, the report indicates a growing Chinese influence in the region as it adapts its strategies to compete with traditional partners.

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