Natural resources and China’s foreign assistance in Africa: a two-sided story

In the context of climate change, countries need natural resources for their development and energy transition process. A large share of these resources is based in emerging and developing countries. Within this framework, we investigate whether natural resources endowment has become a key determinant in the allocation of development aid. We put a specific focus on China, which has started to have a proactive role in international aid to other countries, although it is still an emerging economy. In particular, we analyze whether China is increasingly granting aid to countries well endowed with natural resources and if this official development assistance is motivated by economic interests, mainly those related to natural resources. To do so, we use two sets of data: an original database at the country level, covering the period 2000-2016, and geocoded data on 1650 Chinese development projects across 2969 physical locations in Africa over the period 1999-2013. We built thus our analysis at a macro and microeconomic level. Our results show that the aid granted by China can be linked to access to natural resources.