US and China: Converging and Competing in Global Aid Strategies
The United States and China are modifying their foreign aid strategies, leading to a period of both convergence and competition in global influence.
Historically, the two nations employed distinct approaches to international assistance. The US is now shifting towards a more transactional aid model, while China is increasing its engagement with global health and development initiatives.
China's Evolving Aid Strategy
China's foreign aid approach has undergone three distinct phases:
Phase 1 (1950s): Anti-Imperialism Solidarity
This initial phase focused on anti-imperialism solidarity, supporting emerging communist states like North Korea and Vietnam.
Phase 2 (1990s): Supporting China's Own Development
This period shifted to support China's own development, promoting economic cooperation and trade with countries in the global south as mutually beneficial.
Phase 3 (2010s onwards): Soft Power and Great Power Competition
The most recent phase transitioned towards soft power and great power competition, largely through bilateral agreements such as the Belt and Road Initiative. This phase emphasized large-scale infrastructure projects like ports, railways, and power plants, primarily financed by bilateral loans intended to build physical connectivity and secure economic returns for China.
Historically, China's methods contrasted with the US. China typically engaged directly with governments, while the US channeled billions through aid groups and international organizations like the United Nations to address poverty and disease. US foreign aid grants often focused on long-term solutions and included conditions related to human rights, democracy, and anti-corruption, conditions China generally did not impose.
Adjustments in China's Recent Approach
China's foreign aid strategy faced criticism, including concerns about its efficacy, lack of consideration for local needs, and insufficient resources for project longevity. For instance, Chinese-financed MRI machines were installed but lacked maintenance systems when they broke down.
Additionally, large loans from China were perceived as predatory, making recipient countries economically vulnerable and raising suspicions about China's true economic motivations. Experts noted that subordinating aid to commercial interests eroded trust and soft power, with opaque bilateral negotiations enabling corruption and sidelining public health.
In response, China has shifted its strategy over the past five years. It has moved away from large bilateral deals to fund smaller projects in low-income countries and increase involvement with the United Nations.
In 2021, President Xi Jinping introduced the Global Development Initiative, which emphasizes "small and beautiful" projects aimed at poverty and health issues.
Recent examples include refurbishing a maternity ward in Zimbabwe, sending medical equipment to Panama, and financing a bridge in Kiribati.
China's Role Amidst US Aid Changes
Following changes in US foreign aid during the Trump administration, experts and policymakers expressed concern that a US pullback could create an opportunity for China to expand its influence. Chinese official documents suggest a perception of opportunity as the US reduces its engagement with UN and WHO.
In February 2025, China's aid agency announced it would prioritize "small and beautiful" projects. In March, China pledged $137 million in aid after an earthquake in Myanmar, significantly more than the $9 million from the US. In May, China donated $500 million to the World Health Organization, in addition to its annual dues.
These actions may present China as a benevolent and responsible global power, aligning with President Xi Jinping's vision for a China-centric world order.
Despite these moves, China's overall foreign aid spending in 2025 remained comparable to previous years. Experts suggest China is undertaking short-term measures to build goodwill but is not yet fully investing in the long-term infrastructure and sustainability required for large-scale disease eradication. While China is not expected to immediately fill the void left by the US in global health provision, it is anticipated to prudently increase its influence through foreign aid as the US presence diminishes.
US Reorients Its Aid Model
In a parallel development, the US also altered its foreign aid approach.
Last fall, Secretary of State Marco Rubio introduced the America First Global Health Strategy. This strategy critiques the previous foreign aid model as wasteful and ineffective in advancing US political and economic interests.
The State Department has since established over a dozen bilateral agreements with low-income countries, aiming to secure access to resources, such as minerals in Africa, and create opportunities for American businesses.
This US shift towards a more transactional, commercialized aid model shows a convergence with China's previous approach, at a time when China is moving away from it. Experts caution that by commercializing aid, the US risks encountering similar challenges that China faced, potentially compromising health outcomes by prioritizing commerce over health objectives.