For decades, the foreign development strategy of traditional donor countries has been closely linked to numerous national interests and foreign policy objectives that consist of security, commercial, humanitarian, bi- and multilateral driver characteristics. With the beginning of the 21st century, the actor constellation of foreign aid donors experienced a substantial shift. Driven by economic interconnectedness and increasing demands for natural resources, BRIC nations have expanded their economic and political strength to other spheres and have become relevant actors in development aid and cooperation. Beside the run for political influence in the African region, the global attention on China's engagement is steadily increasing. One the one hand, its economic engagement and development support in Africa differs from the traditional ODA flow of western countries its non-conditionality. On the other hand, China has gained an auspicious geopolitical position and increased its soft power capability in developing countries. Existing studies argue that this new actor constellation introduced by ongoing globalization that fueled economic interconnectedness and trade expansion to the African continent, generated a new field of power politics, in return increasing the importance of development assistance as a powerful foreign policy instrument.
Following this convergence of foreign aid players, our research focuses on the shift of patterns in aid spending and analyzes determinants for foreign aid efficiency that have been made possible by globalization and further south-south cooperation. We therefore concentrate on three essential actors: The United States, the EU and China. All actors appear to share core motives and interests but differ in the strategy and instruments to reach these goals. Thus, a competitive market for foreign aid seems to be on the rise in which African countries can choose the partner they wish to cooperate with. The increasing Chinese presence on the continent raises the question how the US, the formerly most influential and active actor in the region for decades, and the soft power oriented EU react to these developments.
Analyzing the reaction to the Chinese engagement, we conduct a multivariate, cross-sectional panel analysis in a two fixed-effects (year and Sub-Saharan Africa country) model. Hence, specific countries/regions shall be identified and further studied with the use of a regression-discontinuity design.
We conduct this step in order to better understand if globalization leads to cooperation or competition and can explain existing aid (in-)efficiencies in foreign development aid. The dataset is merged from publicized databases of aiddata.org, World Bank and the center for systemic peace and takes countries as the level of analysis.
Through a reordering of the development flow market and competition between donors and recipients, foreign policy shifts and real-political implications should become visible. Has this global actor change and competition opened up new perspectives and analytical tools to a political field in which development assistance is a powerful instrument of foreign policy and power politics? Is foreign aid used to react on such changes? By covering these questions in our paper, we hope to get a better understanding of strategic interests of aid donors and their power political constellation.
