Aid by Democratic Versus Autocratic Donors: Democratisation Processes and Citizens’ Perceptions in Recipient Countries

Summary

Development Dissertation Brief, 2024:03

OECD countries are no longer the sole major providers of financial flows
abroad. Authoritarian countries such as China, Russia, Iran, and Saudi Arabia,
with their distinct practices and implementation processes, are increasingly
present in low- and middle-income countries. In my thesis, I develop and test
hypotheses on the influence of foreign aid on democratic institutions and
citizens’ support for democracy and aid projects. Employing a multi-method
approach, using observational and experimental methods, I analyse the role of
democratic donors (e.g., European Union (EU)) and autocratic donors
(e.g., China), both together and separately. First, I investigate the influence of
democracy assistance in promoting democratisation, emphasising the role of
political conditionality and monitoring mechanisms. The second paper
scrutinises the impact of foreign aid from autocratic donors, particularly China,
on citizens’ support for democracy, considering factors like the
instrumentalisation of aid by politicians and the attribution effects of aid. The
third paper employs a vignette experiment strategy and tests the effects of
autocratic versus democratic donors on citizens’ support for aid projects and
local government. Lastly, I interview experts from three middle-income countries
on the role of democratic and autocratic donors in the democratisation processes
of low- and middle-income countries. The conclusions are that donors striving
to promote and safeguard democracy should not decrease democracy
assistance in the face of democratic backsliding and the increased influence of
autocratic actors. Instead, they should aim to improve mechanisms related to
political conditionality and monitoring to ensure the effectiveness of their
democracy assistance. Furthermore, the increasing presence of autocratic
donors and instrumentalisation of such finance by politicians is changing
citizens’ attitudes and support for democracy in recipient countries. Citizens in
recipient countries want transparency and channels to voice their concerns
regarding aid projects. Democratic donors should prioritise transparent project

implementation, ensure information dissemination regarding who funds the
projects, and provide avenues for citizen feedback regarding aid projects.
Moreover, democratic donors should aim to provide better incentives for
politicians to implement reforms, emphasising short and long-term benefits.
Additionally, they must consider the increasing influence of autocratic donors
offering alternatives and the fast-paced projects that allow for more local
ownership but are more easily manipulated by politicians in recipient countries.
Lastly, Western donors should understand the consequences of inconsistent
use of political conditionality, which harms opposition in backsliding countries
and gives negative signals to reform-committed countries.