Publication

This paper focuses on China’s role as a major donor in the Pacific. China is reducing the grant component of its aid and increasing the soft loan proportion. Debt burdening will become increasingly pressing as Chinese loans accumulate and the grace periods expire. China appears confident in its aid program and sensitive to analysis of it, making efforts to encourage improvements in China’s approach unlikely to be successful. Nonetheless, report recommends that major donors should continue to engage China in joint projects. Pacific governments should report aid flows from all sources and urge China to improve transparency and the use of local laborers, contractors and materials.