China and global development banking

China has helped establish a new family of development banks that rival the existing size and reach of the Western-led multi-lateral development banking system that has held dominance since World War II. At their best, these new banks have the potential to complement the existing system and help finance a transition toward a pro-poor, low carbon, and more socially inclusive world economy. Moreover, the new development banks have the potential to provide healthy competition to the Western-backed development banking system–one that has struggled to maintain its efficacy in a rapidly evolving world. However, there is also a potential for the newly emerging system to ‘lock-in’ high carbon infrastructures that ‘lock-out’ opportunity for the world’s poor.

There is a very small window of opportunity, perhaps only a half-decade or so, to help shape the emerging development banking system toward the more sustainable and inclusive of those two pathways. Boston University’s Global Economic Governance Initiative (GEGI) will devote the majority of its effort over this period to helping members of the development banking community choose the more sustainable path.Through collaborative research and policy dialogue with governments, civil society, the private sector, and the banks themselves, GEGI aims to bring a more empirical-based understanding of the extent to which development banks can finance low carbon economic activity in a manner that is accessible, acceptable, and economically beneficial for the world’s poor.

Publications

By the Global Economic Governance Initiative
April 2017

Since 2000, China’s global development banks have provided roughly $160 billion across the world.  These estimates stem from a new interactive database—the China Global Energy database— and inter-active web portal created and published by the Global Economic Governance Initiative (GEGI) at Boston University.  

By Bo Kong and Kevin P. Gallagher
June 2016

In the new report, The Globalization of Chinese Energy Companies: The Role of State Finance, Kong and Gallagher trace how China’s financial system and state policy facilitates the globalization of Chinese energy companies in terms of trade and investment.  The key drivers of these efforts are the China Development Bank and the Export-Import Bank of China, China’s policy banks.  As China positions a second push in its globalization strategy with the Belt Road Initiative and other projects, we expect to see more of these dynamics play out across the world.  And if the patterns  and structures Kong and Gallagher identify hold into the future, China is poised to lead on the globalization of climate-friendly renewable energy technologies as well-as has already been the case in the globalization of photovoltaics from China.

By Kevin P. Gallagher, Rohini Kamal and Yongzhong Wang
May 2016

According to new GEGI research in collaboration with Yongzhong Wang of the Chinese Academy of Social Science’s Institute for World Economics and Politics, in just over a decade Chinese policy banks have emerged as global leaders in development finance in general and in finance for energy projects in developing country governments in particular.

By William Grimes
April 2016

In the News

China dominates energy infrastructure finance as US pulls back
Financial Times 
China Energy Finance Database analyzed
April 5, 2017

China’s influence on global finance grows as US scales back input
Financial Times
By Kevin P. Gallagher
March 27, 2017

Chinese Development Finance: A Convergence of Passions and Interests
Global Policy
By Kevin P. Gallagher
February 3, 2017

China surpasses the West in funding foreign energy projects
Charles Stewart Mott Foundation
Fueling Growth and Global Financing Risk analyzed
December 15, 2016

China Is Outsourcing Its Pollution
Foreign Policy
Bo Kong interviewed
December 7, 2016

China Is Now The World’s Leading Energy Financier — What Does That Mean For Climate Change?
Forbes
Fueling Growth and Financial Risks analyzed
November 1, 2016

China poised to lead on green finance at G-20 meeting
Financial Times
By Kevin P. Gallagher
August 17, 2016

China’s global energy financing raises climate fears
Financial Times
Fueling Growth and Financial Risks analyzed
May 18, 2016

China becomes global leader in development finance
Financial Times
Fueling Growth and Financial Risks analyzed
May 17, 2016

Quotes

China’s growing role as funder of Africa’s proposed coal plants
CoalEnd.org
GEGI quoted
August 17, 2016

The U.S. And China Are Embracing A Greener Future At Home. Are They Doing The Same Abroad?
Forbes
GEGI quoted
August 17, 2016

Big Banks Finance Water-Damaging, Climate-Warming Energy Projects
Circle of Blue
GEGI quoted
August 8, 2016

Events and Multimedia

Tracking China’s Global Energy Finance
Wilson Center
Presentation of China’s Global Energy Finance Database
April 13, 2017