Building Bridges or Breaking Bonds? The Belt and Road Initiative and Foreign Aid Competition

Abstract China’s renewed prominence is the most important development in international relations 21st century. Despite longstanding rhetoric of its own “peaceful rise”, China increasingly viewed as a long-term strategic competitor, especially United States. Foreign aid one arena where this competition may be playing out. While Western foreign principles have emphasized coordination and harmonization, rise partner has raised specter return to competitive practices. Most notably, China's Belt Road Initiative (BRI), received wary reception by those who view it primarily geostrategic effort, but our knowledge responses BRI often anecdotal fragmentary. To remedy this, we test if inducing response evaluating countries involved initiative are more likely receive US support for loan packages from major, Western, multilateral banks (MDBs). Using an instrumental variable approach, covering 7,850 project/loan 10 MDBs 162 during 2013–2018 period, find that States was vote MDB signed on BRI, predominantly when actual amount Chinese flowing still low, suggesting competing “hedging” countries.