China’s changing role in the international community was underlined by a USD 20 million pledge it made in March to set up a new Poverty Alleviation Fund for economic and social development in Asia. The Fund, to be administered by the Asian Development Bank, is the first of its kind to be financed by a developing country.

China has long had a substantial, overseas aid programme but the Organisation of Economic Cooperation and Development does not count this as ‘official development assistance.’ Channelling funds through the Asia Development Bank marks a significant step towards integrating China into the international donor community.

At the end of February China also donated USD 6.5 million to UNICEF – USD 1 million in cash and USD 5.5 million’s worth of donated materials -- to support the UN agency’s relief efforts in tsunami-struck areas of Indonesia and Sri Lanka. The donation fulfils part of the government of China’s earlier pledge of USD 60 million for relief and reconstruction.

Meanwhile, trade, investment and aid ties with Africa are to be strengthened through a new, China-Africa Business Council. During a Beijing launch ceremony high ranking UN, Chinese and African government officials welcomed this ‘public-private partnership’ which is intended to increase Sino-African trade and investment, reduce poverty and contribute to the achievement of the Millennium Development Goals.

Supported by a USD 1 million grant from the UNDP, the project will establish links between China and five African countries – Cameroon, Ghana, Mozambique, Nigeria and Tanzania – to increase the flow of Chinese goods into Africa in exchange for access to Africa’s rich natural resources.

The initiative will replicate aspects of China’s poverty-focused ‘Guangcai programme’ which, through the Federation of Industry and Commerce, encouraged investment and philanthropic links with western China.

Investment potential in Africa has been identified in five areas, including the pharmaceutical industry in which China has been increasingly active, starting recently to produce the world’s most effective malaria prophylactic.

Report by Matt Perrement and Tina Qian, 18 March 2005