Contributor Perspectives

How Development Finance Is Changing Geopolitics

Jeff Goodson
Board of Contributors
Jul 11, 2018 | 10:00 GMT
A container ship pulls into Djibouti's Doraleh Port in 2015.

A container ship pulls into Djibouti's Doraleh Port in 2015. China, which helped finance the port's development, has also built a military base next door.

(CARL DE SOUZA/AFP/Getty Images)

Development finance has undergone a shift. Though traditional aid flows once dominated the sector, foreign direct investment (FDI) is now by far the leading source of development finance in most of the world's emerging states. At the same time, competition for influence in these countries is heating up, led by China's massive investments in infrastructure projects in Asia, Europe, Africa and the Middle East. The race in development finance is already altering the balance of global geopolitics and will have major economic, military and political repercussions. ...

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