Why is China winning the race for global influence? After all, the United States has almost twice as many diplomats stationed worldwide, spends 10 times as much on foreign assistance, and its contributions to international organizations—such as the United Nations—are 20 times larger. Yet Beijing is gaining new economic and security allies (especially in the developing world), increasing its influence in the international system, advancing key national security priorities, and growing the Chinese economy. Nearly 140 countries have signed on to China’s signature Belt and Road Initiative, a global infrastructure-development strategy to link the world to Beijing and control global flows of data. And at the U.N., Chinese nationals now hold the top position in four of the organization’s 15 major agencies.
So how does the Chinese Communist Party (CCP) do it, and what can the United States learn? Beijing’s global efforts are fast, flashy, and relevant. At every turn, the CCP is building international support and increasing its influence and reach. Washington needs to do the same—and beat Beijing at its own game.
The Chinese are fast. Travel just about anywhere in the developing world, and you will see that the Chinese government has built, or is building, a new facility—a convention center in Malawi, a seaport and airport in Djibouti, or an international financial city in Sri Lanka. While Chinese companies can move the dirt in a matter of weeks, most U.S. efforts outside emergency humanitarian relief take years to launch and organize. The U.S. government procurement process for a contract or grant can last 18 months or more, and that doesn’t include the strategic planning and complicated budget reworks required for new programs, which can take years more. Can leaders around the world really be expected to wait years for the United States when China can deliver in real time? The catch, of course, is that the CCP often pairs its projects with a boatload of debt and a plane full of Chinese workers. Washington can generally offer better terms, products, and results—but must be quicker if it wants to be competitive.
Here is how the United States can do it.
First, Washington needs to reform the way it budgets and appropriates funds for foreign assistance. Right now, the Biden administration is developing its budget request for fiscal year 2023, which begins on Oct. 1, 2022. Federal departments and agencies will not begin spending any money appropriated by the U.S. Congress for that budget until 2026, and any new project financed with these funds might not start until the end of the decade. By then, hundreds of new Chinese projects will already be up and running.
Additionally, congressional constraints and directives dictate much of the budget of the U.S. Agency for International Development (USAID) and the U.S. State Department’s foreign assistance. Take two of the main assistance accounts funded by Congress: development assistance and the Economic Support Fund. Development assistance, which is implemented solely by USAID, is a $3.5 billion per year account that funds everything from economic development to environmental projects to basic education. Congress now directs 96 percent of this account to specific countries and sectors. The Economic Support Fund, which is jointly implemented by both the State Department and USAID, is a $3 billion per year account originally intended to be a source of flexible funding to meet emerging development needs that advance U.S. national security interests. The account is now virtually indistinguishable from development assistance, with various congressional directives consuming around 80 percent of the account.
What’s more, federal departments and agencies often choose to interpret congressional directives narrowly, which further constrains funding. The recent decision by Congress to resume “earmarks”—which direct funds to a specific recipient, circumvent a competitive process, and were eliminated in 2011 following scandals and wasteful spending—will make the micromanagement even worse. This is not to say Congress always gets it wrong—in fact, it’s amazing how often it gets it right given the long lead times and complex environments. Greater flexibility, however, would make the wide-ranging portfolio of U.S. programs all the more relevant and impactful worldwide.
Congress and the White House should work together to make the United States’ foreign assistance funds more flexible while maintaining accountability and transparency. At minimum, they should return to the original vision of the Economic Support Fund as a flexible instrument and ensure that the professionals at the State Department and USAID have the resources to respond quickly to any opportunity around the world that would further U.S. strategic interests. This also means broadening the fund’s list of eligible countries and providing unrestricted funds, subject to congressional review before each project starts. The administration and Congress should also agree to abolish the assistance for Europe, Eurasia, and Central Asia account, and merge it with a larger, more geographically flexible account. A relic of the Cold War, the account is no longer necessary. It restricts funding to one specific region, regardless of need or strategic interests.
Second, the administration and Congress should work jointly to further reform the unnecessarily complex and unwieldy process for awarding foreign assistance contracts and grants. While both the Obama and Trump administrations made good progress to simplify procurement, the current 18 months normally required for a full and open competition doesn’t fit a competitive strategic environment. It will require political capital and tough debates to create a budget and procurement system that is both flexible and respectful of the taxpayers’ trust, but it is urgently necessary.
The Chinese are flashy. When the CCP engages in a country, the Chinese become the talk of the town: big headlines, an all-in approach, and significant deliverables. They purposely embrace big projects with countrywide visibility and impact, and they demand clear Chinese branding and attribution—all accompanied by a full-court press from their diplomatic team and propaganda machine. The United States can and must do the same.
First, Washington must be willing to embrace big-ticket items, including large infrastructure projects, that are clearly U.S.-branded or co-branded. Strangely, there is considerable cultural resistance at the State Department and USAID to funding explicitly U.S.-branded projects. For example, the Trump administration proposed building a pandemic training institute for Southern Africa. While everyone agreed that building greater health capacity is critical, there was opposition from members of Congress who didn’t like the idea of funding a physical building with a U.S. flag at the front gate. Ultimately, the project was withdrawn by the Biden administration. Such a facility would have delivered good development outcomes, advanced critical national-security interests in the region, and sent a strong U.S. message. Meanwhile, the Chinese are building the headquarters for the Africa Centres for Disease Control and Prevention in Ethiopia, having negotiated full access to all of its labs and data. Who was smarter?
The U.S. International Development Finance Corp. was designed as a tool for projecting U.S. influence, but has yet to realize its potential because it has chosen to act as a commercial bank instead. It needs to think and act big while being in lockstep with foreign-policy and development guidance from the State Department and USAID.
Second, the United States needs to promote its brand—unapologetically and everywhere. Washington is the largest donor of foreign aid globally and funds projects in nearly every developing country. Unfortunately, you would have a hard time telling who the donor country was even if you were standing right in front of a U.S.-funded project. You’d see scores of logos of individual U.S. departments, agencies, and partners—but to most people, even Americans, these logos are unfamiliar and cryptic. In contrast, Beijing keeps it simple: Everyone knows what the red banner with the yellow stars means. Fortunately, there already exists a simple, immediately recognizable visual brand to let the people of the developing world know that the United States is actively invested in helping them: It’s called the American flag.
Third, Washington needs to up its game on public diplomacy. Congress eliminated the U.S. Information Agency during the 1990s by folding it into the State Department. In retrospect, this merger gutted the United States’ capability to tell its story. The country is once again engaged in a worldwide battle of ideas and needs to influence hearts and minds. This will require a large cadre of professionals dedicated to public-diplomacy efforts, especially through social and other new media channels. The Trump administration began this process by bringing on more foreign service officers in public diplomacy at the State Department, but much more needs to be done. Washington must provide additional resources to U.S. embassies worldwide, require foreign service officers to undergo more public diplomacy trainings, and hold ambassadors accountable for integrating public diplomacy into their teams’ work at every turn.
Lastly, the United States needs to ensure it gets credit for contributions channeled through international organizations by effective and visible donor attribution. Washington shouldn’t be ashamed of doing good and saving lives. For instance, the U.S. government is by far the largest donor to international vaccine distribution—and rightfully so. Unfortunately, the Biden plan, released in early June, to donate 80 million COVID-19 vaccine doses fails to include the words “branding,” “attribution,” or “from the American people.” I hope this was simply an oversight.
The Chinese are relevant. The CCP succeeds in large part because it offers developing countries what they actually want. The United States, on the other hand, hamstrings itself because its foreign assistance often comes late and for the wrong thing. Regrettably, it is common for a partner government to need specific assistance now, only to hear from Washington that the budgeted funding cannot be used for that type of project.
Take education programs: The United States spends nearly $1 billion each year on basic education for children in developing countries—an important goal. Yet it takes years for anyone to tell whether these investments are paying off. Meanwhile, these countries often have immediate needs, to which Washington has trouble responding. Many want English-language programs for adults, access to nearly 1,000 U.S. community colleges for their young adults, or training in business for their budding entrepreneurs. These are amazing opportunities to expose the world’s future leaders to U.S. culture and values while ensuring that English remains the international language for commerce. Unfortunately, congressional and administration restrictions largely exclude the use of basic education dollars for these purposes. It’s as if no one has heard that good international development policy puts recipient nations in the driver’s seat by listening to local voices, hearing their concerns, responding to their unique needs, and investing in local institutions. All of this should be common sense.
Of course, Washington should not copy Beijing’s entire playbook. The Chinese government is well-known for offering unsustainable loans with opaque terms, degrading the rule of law, helping despots create police states built on omnipresent electronic surveillance, and insisting that governments give special treatment to Chinese companies. The United States certainly should not emulate every aspect of China’s engagement, but there are many lessons to learn.
With serious budget reform, increased flexibility in how Washington can spend its money, and seating partner countries at the table when key aid decisions are made, the United States can fix the self-inflicted problems that are holding it back in the developing world—and offer a much better alternative to the CCP.
