In an article excerpted from the 2012 China Blue Book of Philanthropy, Lin Yuanzhuan recounts an important internationalizing step by the China Foundation for Poverty Alleviation (CFPA).
The CFPA’s efforts to transform itself into an international NGO are perhaps the most prominent example of a recent interest among Chinese NGOs in “going abroad” as they follow the expansion of China’s global footprint, and respond to the Chinese government’s call to promote China’s soft power.
Abstract: The Sudan-China Abu Ushar Friendship Hospital (苏中阿布欧舍友谊医院), located in a rural area of Sudan, was built by the China Foundation for Poverty Alleviation (CFPA, 中国扶贫基金会) with financial aid from China National Petroleum Corporation (CNPC, 中国石油天然气集团公司) and officially completed on July 2011. The total investment amounted to U.S.$1.1 million (6.93 million RMB). At the ceremony marking the hospital’s completion, the Vice Chairman of the 11th NPC Standing Committee, Chen Changzhi (participating by videoconference from the Great Hall of the People in Beijing), and the First Vice President of the Sudan, Ali Osman Taha, met with the members of the delegation leaving for Abu Ushar township in Sudan’s Gezira State, to participate in the hospital’s opening ceremony. The event was extensively covered by Chinese media including the People’s Daily and Xinhua News Agency as well as by the Sudan National Broadcasting Corporation.
Feature: The rapid growth in quantity and scale of China’s nonprofit organizations is closely connected to globalization. Chinese NGOs have in the past received assistance from many countries. As China has grown stronger, several are developing public welfare projects and models to introduce overseas. This international assistance and strategy is a natural response to the globalization of philanthropy.
The Chinese Ministry of Foreign Affairs listed the Abu Ushar project as one of its Model Public Diplomacy Programs of 2011.
Background
In 2011, China’s GDP reached nearly 47 trillion RMB and per capita GDP was valued at U.S.$5,540. Non-agricultural employment and urbanization have accelerated and the urban population now constitutes over half of China’s total population. Humanity has never dealt with such large-scale urbanization. The pace of China’s globalization has increased as it’s national strength and rate of development has also increased. This has created strong demand for global products, technologies and management techniques as well as increased dependence on non-domestic sources of energy and raw materials. According to 2010 statistics from the Ministry of Commerce, National Bureau of Statistics, and the State Administration of Foreign Exchange, China’s foreign direct investment (FDI) increased by 21.7 percent from the previous year, reaching U.S.$68.81 billion. By the end of 2010, more than 13,000 Chinese investors financed the establishment of 16,000 enterprises in 167 countries/regions worldwide. In total, FDI amounted to U.S.$317.21 billion.
The internationalization of the Chinese economy and expansion of overseas investment face unprecedented challenges, many of which emerge from companies’ own capacities and China’s late entry in the international arena. As China has grown into a major economic power, the international community’s expectations regarding its global role have changed as well: its transition from a recipient of aid to a donor country; its provision of humanitarian aid; and its involvement in environmental protection, promotion of global and regional peace, and adoption of new perspectives and strategies in the use and protection of resources. This historical change in China’s role will pose a great challenge to the conventional approach and operations of the Chinese government and Chinese companies.
The CFPA became involved in overseas aid starting with the delivery of assistance to victims of the Indonesian tsunami on January 1, 2005. At present, the CFPA has invested 60.88 million RMB in international aid, including emergency relief in the wake of the Indonesian tsunami, Hurricane Katrina in New Orleans, the Pakistan earthquake, Burmese typhoon, Chilean earthquake, Haitian earthquake, Japanese earthquake, East African drought, and other natural disasters. It has also started mother and child poverty alleviation programs in Guinea-Bissau and the Sudan.
CFPA’s assistance to the Sudan reflects the substantial steps it is taking as part of its internationalization strategy.
The Process
Preliminary Research
In April 2007, the Second Plenary Meeting of the CFPA’s Third Executive Council decided to “investigate the circumstances of surrounding countries and select the optimum moment for international expansion” and proposed a general development strategy based on internationalization and a change in the Foundation’s fundraising methods. In 2008, CFPA established a project research team on African aid and began focusing on the Sudan.
In October of 2009, CFPA Executive Vice Chairman He Daofeng led a research team to Sudan. During his research visit, the Foundation tried to develop a thorough understanding of Sudanese society, health care, and charity, visited the Ministry of Health, Ministry of Humanitarian Affairs, General Union of Sudanese Women led by First Lady Fatima Khalid Al-Bashir (an organization which supports poor mothers), Sudanese Red Crescent Society, and other relevant organizations. After completing field research, the CFPA decided to sign a memorandum of agreement with a local NGO the Birr and Tawasul Organization (BTO) and to address one of the serious social problems in Sudan – the high maternal and infant mortality rates. Combining the research results with the lessons learned from the Maternal and Infant Health Project carried out by CFPA in China, the organization completed the project proposal “Demonstration Project for Aiding Sudan Construct a Maternal and Child Health Care System.”
Implementation
In June 2010, with the help of the CFPA the “Demonstration Project” received support from CNPC, a division of which (CNPC Nile) donated U.S.$600,000 for its first project – the Sudan-China Abu Ushar Friendship Hospital.
There are many factors that must be addressed when building a hospital, including building materials, procurement of medical equipment, shipping, customs clearance, equipment installation, etc. Since the CFPA lacked experience in a foreign environment and to avoid possible risks, it signed an agreement in advance stipulating that customs clearance and transportation for materials in Sudanese territory would be handled by the Sudanese partners. However, since it was the first time the Sudanese partners were receiving material aid from abroad, they were late obtaining tax exemptions from the Ministry of Finance and import licenses for medical equipment. As a result, the goods could not leave the port and accrued detention charges for the time they remained at the port. Confronted with this problem, the CFPA sought help from different parties while actively looking for solutions with its partners. In the end, with help from the Chinese Embassy, the goods left port by March 2011. The high detention charges, however, produced costs that exceeded the planned budget. Since this was an unexpected incident, the CFPA covered all of the additional custom clearance fees.
Geographic, ethnic, and cultural differences produced differences in efficiency, working methods, and ways of thinking between the Sudanese partners and Chinese which often caused a certain amount of friction. In order to prevent future problems from occuring, the CFPA decided to send two employees to the construction site in spite of limited finances, time and staffing. In this capacity, these two staffers could assist the project team, oversee construction from beginning to end, and promptly solve any problems that should occur.
Since this was the organization’s first attempt at such an endeavor many problems were difficult to project in adance. During construction, small unexpected incidents would often occur. For example, the construction company, steel production company, and local hospital haggled and passed off responsibility, generating overall confusion. This complicated project implementation and produced unforeseen expenses. As a result, final costs for the Sudan-China Abu Ushar Friendship Hospital greatly exceeded the project’s budget and donations.
The CFPA, therefore, instructed its two local staff members to prioritize problem solving, pushing forward implementation, and preventative tactics to stop problems from arising and creating greater difficulties. Only after a problem was resolved were they to investigate who should be held responsible.
The Results
On May 2011, the hospital’s interior was completed and in June, 11 months after construction began, the Sudan-China Abu Ushar Friendship Hospital was completed. This project, the first chartiable project of its kind, marks a major breakthrough for Chinese NGOs seeking to internationalize their aid programs.
In order to encourage the charitable spirit of corporate donors and provide the Chinese public a better understanding of overseas aid projects, the CFPA held a “Review and Recognition of the 5th Anniversary of CFPA Overseas Aid Programs & Opening Ceremony of the Sudan Maternity and Child Care Hospital” conference at the Great Hall of People in June of 2011. That July, the opening ceremony for the Sudan-China Abu Ushar Friendship Hospital was held in Abu Ushar in Sudan’s Gezira state. The hospital began operating in October and, in December, the CFPA’s Sudanese NGO partner, Birr and Tawasul Organization (BTO) and the Gezira State Department of Health held a joint board meeting of project partners. In the same month, staff from the CFPA and BTO created an inspection team and invited CNPC Nile to evaluate the hospital.
Commentary
From a macro perspective, the internationalization of NGO aid programs is a response to China’s public diplomacy strategy of strengthening its soft power. At this early stage, NGOs still require government support, especially from China’s embassies and consulates. The CFPA made great efforts to lay a foundation for its work. Not only did it develop a partnership with a Sudanese NGO – the Birr and Tawasul Organization, it also received assistance from the Sudan Embassy in Beijing during the customs clearance crisis. At the same time, the CPFA established close contacts with the Communist Party of China’s International Department, Ministry of Foreign Affairs, Office of Poverty Alleviation, the Sudanese Ministry of Health, the Sudanese Ministry of Humanitarian Affairs, and other government organizations. It also received assistance from the Chinese Academy of Social Sciences, the Institute of West Asian and African Studies, Gansu Research Institute for Water, and other academic institutions, and received financial assistance and know-how from CNPC, Dalian Hankai interior design company, and other companies.
“Foreign affairs is no small matter.” The implementation of a public welfare project overseas represents a substantial test for a NGO; as culture and geography change, any small mistake made during project implementation may cause irreversible damage. Chinese NGOs are only beginning to expand their work overseas and have no experience on which to draw. There are many uncertainties when planning an international development assistance project. The intended design plan often encounters unexpected complications during the implementation phase. Take for example the hospital project in Sudan; the procedure for clearing goods through customs would normally take one month, but in the end, it stretched out over four months. It also took time to become familiar with local customs and ways of working in the recipient country. Lack of experience with international projects also led to budget overruns and a variety of minor problems during the construction phase.
Inconsistent funding also restricts the internationalization of NGO projects. The CFPA may be one of the most influential NGOs in China, but as soon as it went abroad, it too ran into difficulties and funding shortages.
At present, a majority of the Chinese public do not understand why an NGO should provide assistance to countries outside China. Public support, therefore, is important for an NGO when it is deciding its development strategy. It is, therefore, crucial to make the public understand the importance of overseas assistance programs and humanitarian aid.
