Bundling policy and business in Chinese overseas development finance: Opportunities and risks in ‘maturity mismatch’ of multiple goals

This study investigates the overseas operations of China’s development finance institutions (DFIs), namely China Development Bank and China Export and Import Bank, to analyse how they handle sometimes-conflictual goals of national strategy, financial sustainability, and host country development. It describes Chinese DFIs’ methods of project bundling (of commercial and welfare projects, and strategic and commercial projects) and leveraging existing and future assets, and it analyses their mixed degrees of achievement of multiple goals by borrowing the concept of maturity mismatch from the field of finance to political economy of development cooperation. It argues that those methods may create opportunities for unprofitable projects to take off, but they also carry a risk of maturity mismatch between long-term strategic and development goals and short-term economic and political interests.