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Sub-Committee examines ‘complex mosaic’ of UK aid ties with China

21 September 2021

The Sub-Committee on the Independent Commission for Aid Impact (ICAI) examines the complex and sometimes controversial issue of foreign aid flows to China.

Wednesday 22 September 2021

  • Please note there is currently no physical access to Committee sessions for members of the public due to Covid-19 restrictions.

At 9.30am

  • Sir Hugh Bayley, Commissioner, ICAI
  • Gideon Rabinowitz, Team Leader on ICAI’s China information note

Purpose of the Session

In April 2021 the then-Foreign Secretary announced that UK official aid to China from the Foreign, Commonwealth and Development Office would be cut by 95% to £900,000 and be limited (apart from the wind-up costs of earlier activity) to “programmes on open societies and human rights”. However, other UK spending departments have also engaged with China on a variety of programmes such as global health and climate change, still spending UK aid on China. The Foreign Office aid cut does not account of many of these programmes.

The Sub-Committee on the Independent Commission for Aid Impact, chaired by Theo Clarke MP (Con, Stafford), will take evidence on the broad range of UK engagement with China involving parts of government such as such as the Foreign, Commonwealth and Development Office, the Department for Health and Social Care, and the Department for Business, Energy and Industrial Strategy.

According to ICAI, the UK’s development engagement with China is a complex mosaic of:

  • ‘Aid to China’ – UK aid support to China’s development;
  • ‘Aid with China’ – UK-China partnerships on global development issues; and
  • ‘Aid on China’ – the UK working with third countries on their engagement with China

China is the world’s second largest economy, a major global investor and, since the 1980s, has lifted over 800 million people out of extreme poverty. However, around a quarter of its population still live below the $5.50 a day poverty line and it has an average income per capita of just over $10,400 per person. This means it is currently eligible for Official Development Assistance (ODA) under criteria set by the rich-country grouping, the Organisation for Economic Cooperation and Development (OECD).

As China’s income grows in the next few years, the country is likely to become ineligible for aid under OECD rules, meaning the nature of how the UK engages with China on issues such as global health and climate change is likely to change.

Wednesday’s evidence session will look at a study made by ICAI (the watchdog calls this an ‘information note’) on UK-China development relations and Members will question an ICAI Commissioner and an ICAI expert official.

Further information

Image: PA