Awakening China: A Comparative Analysis of the Impact of Chinese Investment on the Governance of Emerging and Developing Market Countries

Abstract

Since the beginning of the twenty-first century, China has pursued a Go Global strategy to integrate itself into the international economy and increase its political influence. Central to this pursuit is China’s engagement with emerging and developing market countries by offering concessional loans and grants for infrastructure development. Competing with Western-led institutions such as the World Bank, China provides an alternative to Washington Consensus conditionalities. The research seeks to determine whether Chinese loan and grant commitments to emerging and developing market countries impact democracy and freedom in recipient countries. By examining trends in Economist Democracy Index Scores and Freedom House Freedom Scores compared with Chinese loan and grant commitments as a percentage of the recipient country’s GDP, the research demonstrates that there is little association. Further analysis is conducted with case studies on two African countries, Zimbabwe and Gabon, and two Latin American countries, Argentina and Guyana, to examine their political and economic engagement with China. Despite the lack of association identified between Chinese loan and grant commitments with democracy and freedom in recipient countries, it is evident that China is growing its political and economic influence on a global scale. Through genuine geopolitical relationships and debt trap diplomacy, China has garnered support to gain more significant influence in global institutions such as the United Nations, resulting in an increasingly bipolar world in the twenty-first century.