RESUME
The Current State and Challenges of Economic Cooperation Between China and the Global South: Focusing on the BRI and GDI
Yim Banseok(Chongju University)
The Belt and Road Initiative (BRI) and Global Development Initiative (GDI) exemplify China’s commitment to and the nature of its economic cooperation with the Global South (GS). Following the Trump administration’s retreat from multilateralism and its temporary suspension and subsequent recalibration of aid to the GS, the United States, at least under Trump, appeared prepared to abdicate or reduce its great power responsibilities in areas such as alliances, partnerships, development cooperation, and aid to the GS. In contrast, China has emphasized multilateralism through institutions like the United Nations (UN) and the World Trade Organization (WTO), striving to engage GS nations through multilateral cooperation. Simply put, while the United States has turned away from cooperation and multilateralism, China seeks to leverage multilateralism to strengthen its global influence. The power dynamics between the two nations are moving in divergent directions rather than converging toward collaboration.
China has long identified itself as part of the Third World, the non-aligned movement, and the intermediate zone. Now, it seeks to align its identity with the GS, capitalizing on the vacuum left by the United States. Since the late 1980s, following the collapse of the Soviet Union, China has rapidly replaced Soviet influence in the Third World through economic cooperation and aid. By the late 1990s, China adopted an “outward expansion” strategy, marking the full-scale globalization of Chinese capital. By the 2010s, through the BRI, China initiated infrastructure-centered development cooperation plans targeting parts of Eurasia and East Africa, investing enormous amounts of capital into various infrastructure development projects. In 2021, China unveiled the GDI, an ambitious development cooperation plan explicitly designed for the GS. The GDI functions as a global extension of the BRI, and alongside other initiatives like the 2022 Global Security Initiative (GSI) and the 2023 Global Civilization Initiative (GCI), China has presented a comprehensive cooperation paradigm encompassing economic, political-security, and cultural domains. These three global initiatives constitute the blueprint for achieving the “China Dream” (the great rejuvenation of the Chinese nation), with the GDI serving as its critical material foundation.
China’s historical engagement with the GS includes economic cooperation and aid, and it continues to focus on fostering solidarity with the GS. Having experienced semi-colonial subjugation, post-1949 China maintained an anti-imperialist and anti-American stance, collaborating at times with Russia or the United States, depending on its economic development needs. However, with its growing economic scale and influence, a more confident China has aligned itself with Russia, cooperated with BRICS, and seemingly embraced a confrontational posture toward the United States. Unlike the United States’ detachment from multilateralism, China actively promotes multilateralism, free trade, and respect for sovereignty while strengthening collaboration and solidarity with the GS. It seeks to align its identity with the GS, recognizing the importance of securing the GS as allies to realize its global ambitions. Amid intensifying U.S.-China strategic competition, China has made no secret of its intent to lead not only in development cooperation and political-security collaboration with the GS but also in shaping cultural discourses and global order. These efforts reflect China’s challenge to the Western-centric political-economic order and cultural values that have dominated the world for decades.
With the U.S.-China rivalry becoming more pronounced, China has increasingly emphasized its identity as a member of the GS, a strategy that has gained momentum in the 2020s. To position itself as an alternative to the United States, China aims to rally the GS—a majority bloc on the global stage sharing comparable historical experiences with China. By highlighting their shared colonial histories, China seeks to establish commonality with the GS, emphasizing pluralism and multilateralism as alternatives to the U.S.-led unipolar world order. Through the BRI-GDI, China aspires to lead the global economic order, the GSI aims to redefine the political-security order, and the GCI seeks to replace universal values such as democracy, human rights, and freedom with a new civilizational standard.
China’s rhetoric surrounding the BRI-GDI initiatives often portrays its investments as “support for peace and development,” leading to potential misunderstandings of its projects as Official Development Assistance (ODA) or humanitarian aid. However, the capital that China injects into the GS, whether as investments or loans, is not ODA. Instead, it constitutes Other Official Flows (OOFs), primarily serving as economic cooperation funds and development finance. A significant portion of these funds takes the form of high-interest commercial loans. These loans feature high interest rates, stringent lending and repayment conditions favorable to China, and inherently commercial characteristics. The commercial nature of these investments, the significant debt burden they impose on recipient nations, and the resulting increase in political and economic dependence on China have raised numerous concerns on the ground. While China’s foreign investments, under the guise of development cooperation, may provide the foundation for economic growth and development, development finance and loans do not necessarily translate into economic progress, as the post-World War II experience of many developing nations demonstrates.
In terms of foreign aid alone, China remains far behind the United States in areas such as health and education assistance to developing countries. In 2023, the United States provided $12.4 billion in health aid, compared to China’s $780 million, with China’s contribution amounting to just 6% of the U.S. total. U.S. health aid to Afghanistan, for instance, accounted for 350% of the Afghan government’s health expenditure, underscoring its critical role. Given that the United States continues to emphasize “America First” policies and recalibrate its foreign aid, and that European nations may reduce overseas aid due to rising defense expenditure needs, it is unrealistic to expect China to fill this gap. Consequently, no single country appears capable of replacing U.S. foreign aid, raising concerns about potential human security crises.
Despite China’s persuasive rhetoric, the behavior of Chinese capital under the BRI-GDI initiatives resembles, in essence, the practices of European imperialist powers and post-World War II American hegemony. This reality is evident in many regions where these projects are implemented. While China claims that the GDI aims to reduce global development gaps and promote the UN’s Sustainable Development Goals (SDGs), its initiatives may be misinterpreted as large-scale aid or assistance for developing nations. However, the capital mobilized for BRI and GDI projects is unmistakably development finance, much of it high-interest investment. In terms of pure aid and humanitarian support, China cannot match the contributions of the United States or European countries.
Whether the GS will readily accept China’s persuasive efforts and outreach remains uncertain. Although aspects of China’s identity alignment strategy resonate with parts of the GS, factors such as China’s status as an economic powerhouse, its ambition to become a central pole in a multipolar world, and its behavior in many developing nations undermine its appeal. While GS nations are undoubtedly focused on economic development, many remain wary of their historical experiences with colonial powers and global hegemons, and they are not free from the legacies of these relationships. How they respond to China’s capital-driven persuasion and outreach remains to be seen. Furthermore, U.S. efforts to contain and counter China’s rise, as well as competition from potential rivals like India, will serve as additional variables influencing the GS’s response to China’s initiatives.
The increasing competition between the United States and China may force GS nations into difficult positions, potentially requiring them to make binary choices. However, internal solidarity within the GS appears insufficient. The time has come for GS nations to decide whether to act as swing states or remain on the sidelines. How they respond to China’s rise and the projection of Chinese capital will be a critical challenge. While GS nations may choose to align with either the United States or China, the historical risks of tilting toward great powers suggest that solidarity with other emerging or middle powers may be a more rational option. Viewing the issue from the perspective of the GS and new key players, and generating ideas for solutions through solidarity, has become an urgent task.
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