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Opinion
Letzte Aktualisierung: October 27, 2021

Debt trap or generous foreign aid?

By Andreas Fuchs, Kiel Institute for the World Economy
Andreas Fuchs heads the Kiel China Initiative at the IfW

Is China luring other emerging markets into a "debt trap"? China's particular form of foreign aid invites misunderstanding. A thorough analysis of openly available data by researchers provides a much more nuanced picture.

China's development cooperation with the Global South has gained the attention of Western media. However, growing attention has not always led to growing understanding. Many media outlets, for example, speak of China's "credit trap" and "debt-trap diplomacy". At the same time, for example, Deborah Brautigam, a professor at Johns Hopkins University, and Meg Rithmire, an associate professor at Harvard Business School, argue: "The narrative wrongfully portrays both Beijing and the developing countries it deals with." Is the charge of "debt-trap diplomacy" justified?
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