In Foreign Policy’s Fall 2025 print issue, economic historian Adam Tooze makes the case that with hindsight, the global development agenda of the last few decades seems like “an effort to craft a world organized around a spreadsheet of universal values rather than politics.” China’s success in lifting hundreds of millions of people out of poverty, he argues, “has not fostered greater trust or agreement on a rules-based order. Instead, it has triggered a new cold war.”
On the latest episode of FP Live, I invited Tooze to discuss his essay further. Tooze is a professor at Columbia University and also a co-host of FP’s weekly economics podcast, Ones and Tooze. Subscribers can watch our full discussion on the video box atop this page or download the FP Live podcast. What follows here is a lightly edited transcript.
Ravi Agrawal: Let’s talk about your essay. You begin by describing how strange it is that the United States denounced the United Nations’ Sustainable Development Goals [SDGs] this year. The larger point you get to is quite profound: This isn’t just about the Trump administration—or even the United States. The collective West talked a big game about development as a human right, but it wasn’t prepared for the likes of, say, Ethiopia or Nigeria to reach even Turkish levels of GDP per capita.
Adam Tooze: This essay is an exercise in using the Trump moment not just to collapse into a nervous heap but to actually reflect on the 10th anniversary of both the SDGs and the Paris Agreement on climate—to try to decipher it and understand it for what it was.
I wanted to pick away at that moment in 2015, which in retrospect appears weird, to put it crudely. At least pro forma, all of the governments of the world agreed on two very basic objectives. One was a truly comprehensive package of transformative improvements to human conditions and life. The other was a determination to stabilize the climate on a timeline. Literally every government in the world signed up, and when that happens, you have to wonder what was going on. We need to ask historically how that came about.
At the time, those developmental goals were sold as the opening of a new era. In fact, I argue that moment was a last gasp of Western assumptions about unipolarity and power. The only way in which it would make sense to even imagine the realization of that incredible suite of development objectives is to believe that you’re in charge by the grace of God—that there are some fundamental things that secure American and Western hegemony such that one could imagine humans flourishing in large parts of the rest of the world without causing a geopolitical panic attack in the Beltway.
This is where China really called America’s bluff because if there’s one country in the world that has fully realized a fairly comprehensive set of development objectives, it’s China. As soon as that happens, you realize this isn’t just a humanitarian thing. It has consequences for hard power. It has consequences for the balance of power. That has really become the embarrassment of American policy, not just under Donald Trump but in fact under Joe Biden as well.
RA: Just to underscore that, this is not a left critique or a right critique. This is a critique of the consensus in the United States and in the West.
AT: And the good faith of that presumed normality. The problem with Trump is he’s so rebarbative and scandalous that he overshadows the things he’s attacking to the extent that we can no longer examine them. We can no longer see ourselves in the mirror because all we see now is just Trump looming. We need to think hard against that tendency.
To my mind, the rise of China has fundamentally altered the game because it delivered development and it turned out to be a huge problem for the West. Imagine if Mexico achieved the per capita standard of living of Canada. What would that do to the balance of power in North America? I think it’s perfectly evident that it would be profoundly destabilizing for Washington to have Mexico with the economic heft of its northern neighbor.
It’s that basic exercise of asking, what were we actually doing in promulgating this? Were we serious about what we were doing? Or has China exposed the fact that when push comes to shove, that apparent consensus around the basics of human existence is potentially very problematic from the position of the status quo powers? Looking back as a historian, you realize that it’s the most obvious thing in the world. Since when did development get decoupled from power? The principal reason why countries wanted to develop in the more distant past was not to achieve a matrix of human well-being and gender parity and ecological objectives. It was first and foremost to protect themselves against the bullying and imperial hegemony of other powers and then to become major players themselves on the global stage. Sovereignty is not just a static property that gets you into the U.N. General Assembly. It means you’re an actor on the historical stage.
RA: If you overlay population trends onto some of the changes you’re describing—and if you assume that global population peaks around 2060 or so and that the biggest gains will be in parts of sub-Saharan Africa and South Asia—it means that the universalism that underpinned a lot of thinking about development is even more outlandish if you project forward not just to the present day but to, say, 2050.
AT: We don’t even need to go that far into the future. Think about the Ethiopian story, the great darling of African development in the 2010s. Ethiopia emerges from a perma-crisis into a state of empowerment, and it’s got a bunch of scores to settle. When it breaks through to that higher level of development, it engages in a murderous combination with Eritrea against Tigray. And we get one of the great humanitarian disasters of recent years. That’s what we should expect development to look like.
Ethiopia didn’t need to converge with Turkey’s level of GDP per capita to become a player. It needed to cross a bunch of thresholds, at which point it acquired capacities and freedom to maneuver, which enabled the regime to start thinking boldly about geopolitics.
Stay in the same region, and look at the United Arab Emirates, which grew to a mega-powerhouse city-state with incredible oil wealth behind it. All of a sudden it’s a major factor in multipolarity. Look at a player like Rwanda or the Houthis, who have only partial control of a desperately poor state and nevertheless have crossed the threshold to geopolitical relevance. Those are the sorts of dynamics that we’re unleashing. Sustainable development, if achieved, underwrites the prospect of multipolarity in an absolutely massive way.
RA: Let’s talk about how capital fits into this and whether it could have made a difference at least on the question of development goals. There was a period where you couldn’t go to a big conference without hearing people describe how billions in public capital could lead to a much, much larger amount of private capital for development—the idea that blended finance would solve a lot of the problems in the developing world. Why did it fail?
AT: This is the other flank of the 2015 agenda. It started about 10 years earlier with the Millennium Development Goals, when people like Jeffrey Sachs had been advocating a Big Push: really large-scale spending in a 10- or 20-year burst to achieve transformation.
A new breed of Big Push economists started adding up the numbers and creating sustainable development goals. They calculated that it would cost around $3 trillion to $5 trillion a year, which is an eye-watering amount of money until you realize that global GDP is $100 trillion. So we’re talking about 3 percent of global GDP, which is within the realm of the conceivable—if global GDP were a single budget and there were a global sovereign. At that point, it all begins to fragment, and you realize that’s never happening. We’re never going to get to the trillions.
That’s the moment when the smart financial engineering type said, “There’s a way forward here, by generating a multiplier effect by way of de-risking. What we’ll use is the relatively modest amounts—the billions, maybe tens, maybe hundreds of billions—of public money to de-risk private lending. If we skim off the worst element of the risk, then there’s really no reason why private money would not follow. If we can offer them African infrastructure bonds with a rate of return of 7 percent and a risk profile that’s not much worse than American municipal bonds, we will get investors.” That was the idea.
I would place its high point as Glasgow’s COP in 2021, when Mark Carney headed up this Glasgow financial accelerator. He said he had $133 trillion in assets signed up. But virtually none of it emerged.
The simple answer to your question is that if you’re going to use this for something more than just a pleasant conference talking point, you are really going to have to come up with very substantial amounts of public money to remove the worst risks. Do not expect the private side to play fair, as we’ve seen again and again and again in debt restructuring. They talk a big game, but when the risk actually materializes, all of a sudden they’re in protective mode, bargaining over debt restructuring and trying to offload on to the International Monetary Fund and the World Bank.
On the one hand, the 2015 vision was geopolitically blind, and on the other hand, it was utopian when it came to financial engineering. It was really a fantastical construction.
RA: I can see how a humanist universalist ideal can cause a reactionary “return of history” moment and “America First.” The point being that nationalism matters, nation-states matter, realism matters, self-interest matters. But climate change is beyond just a nation’s self-interest; it’s actually a planetary self-interest. What is holding back climate financing?
AT: First of all, we mustn’t accept that construction of what realism is. That’s not realism. It’s just a crass ideology of nationalism expressed in highfalutin terms. The climate diagnosis, the SDG agenda, the global pandemics agenda: That’s not liberal do-gooding. That’s mature, enlightened self-interest. Until very recently, that was in fact very widely accepted in American politics as well.
On climate, and with development in general, the basic problem is bankable projects. Is there a pipeline of realistic, cashed-out, properly designed projects, whether for rare earths in Latin America in the face of Indigenous objections and local politics, so [an asset manager] like Macquarie can get interested? Because they want rule-of-law provisions, protection of property rights, management of risk. And the basic problem with large parts of the developing world is that no one is willing to make those guarantees. The Chinese were doing it on a large scale around 2015 in the first iteration of One Belt, One Road, but they’ve sobered up. There’s very little lending of that type still going on. We now see a large phase of Chinese foreign direct investment [FDI]. There’s a brilliant dataset published by Johns Hopkins and Boston University showing this. We’re talking about $250 billion worth of Chinese FDI in green energy projects. This is the Chinese building factories for batteries or photovoltaics around the rest of the world. You need investors who are willing to take risks, who have experience, and, in the Chinese case, who are desperate enough because of the extraordinary walls of protectionism they’re coming up against.
Building an FDI project for a couple of billion is fundamentally the best guarantee of market access. So a sensible industrial policy, a sensible protectionist policy, has a good chance of attracting that kind of investment. Elements of that are working with regard to the United States; they have been working both through the Biden and the Trump presidency. They are producing an outward flow from the major centers of green tech, which are no longer in the West but are in South Korea and China.
RA: You spent a fair bit of time in China this past summer; I was also there for a short time. You have to see it to believe it. There are electric vehicles with green license plates everywhere. Last year, Chinese consumers bought more EVs than cars with internal combustion engines. In the month of May, China created 93 gigawatts of new solar power capacity, which is more than what Poland generates in total from all sources. Talk about the strides China has made toward solving the world’s emissions problems, even with the West focused on constraining rather than partnering with it.
AT: Yes, it is remarkable to see. None of the high-end European manufacturers have a chance against the glitz and the glamor of the current generation of Chinese electric vehicles. The solar numbers you quoted will probably go down in history. Best guess is China installed 250 gigawatts of solar in the first six months of this year, which is more than America has installed in history to date and more than twice what Germany has installed. America installed 21 gigawatts in the first six months of this year, so China is doing 12 times as much, with an electric system twice as big as America’s and an economy that is 30 percent smaller by purchasing power parity measures. Admittedly, this is the Trump slump, and on the other hand, China has a five-year plan that’s expiring, so everyone is rushing to take advantage of the incentives. But they’re transforming the game. They’re up to 30 percent electrification now for final energy consumption. The crucial thing to do to mitigate the climate crisis is to move all of our energy use toward electricity because we know how to generate clean, emissions-free electricity, whether through atomic, hydropower, wind, or solar. We have a solution, but we may not yet have the capacity. China certainly doesn’t because it’s still overwhelmingly on coal, but that transition is happening there now.
The best Western analysts think China’s emissions may have peaked earlier this year. That doesn’t mean they aren’t increasing coal emissions still, but the offset from the huge surge in wind and solar power is enough to compensate. And this spills over to the rest of the world. Solar is the backbone of Europe’s green projects, and 95 percent of European solar investment is coming from China. They’re trying to get to 600 gigawatts by 2030, which China could do in a single year if they really needed to.
Even more encouragingly, poor countries are availing themselves of this possibility. Pakistan has a chronically malfunctioning fossil fuel-dependent electric system. Businesses and middle-class Pakistanis imported about 15 gigawatts of Chinese solar last year, so the Pakistani middle class can uncouple from the collapsing state grid. Data from the first half of this year shows a surge of imports across sub-Saharan Africa as well, where there are still hundreds of millions of people without even a basic electric supply.
This is the revolution we were all hoping for—a historic shift of scale. Solar power was invented in California and pioneered at scale by the Germans in the 2000s, but in the 2020s, China is delivering the solar push that we need. It’s the old Marx question: When you harness the productive forces of modernity to solve your problems, how do you avoid turning them into a curse that provokes greed, trade wars, social dislocation, unemployment, and financial crisis? This is the solution to a large part of the energy transition problem. But the world economy is structured in such a way that it’s actually perceived in large parts of the world, notably in the West, as an existential challenge.
RA: If developing countries like Indonesia, the Philippines, Nepal start taking on more Chinese clean energy as they grow, what does that do to global emissions? The West has been trying to constrain some of this and rightly points out that Chinese clean tech comes with potential problems like surveillance tech. What will this mean geopolitically?
AT: On the one hand, this creates reliance, but it also creates opportunities for trade, which is the great missing element in the sustainable development agenda in the West. Not only is this not a matter of charity; developing Africa is also the great economic opportunity of the next 50 years. We’re liberals—we look at poverty and say, here’s an opportunity to get rich together. And the Chinese see this and are in a mood to operationalize this. And so, whether or not it comes with security risks, it comes with the sense that all the prosperity and growth came through the connection with China. This is also true in Latin America, where countries like Brazil and Colombia are oriented toward China principally because they are good customers. We have to think through the very different politics and geopolitics of these different energy systems. You may owe the Chinese when they sell you the panels, but once they have, the solar panels are yours to own and operate. Really complicated politics would emerge if the Chinese realized their next step, which is mega-regional grids. The Chinese are indisputably leading electrical engineering in ultra-high-voltage, long-range transmission, and their ultimate aspirations are to build regional-level renewable power grids throughout Southeast Asia. This goes hand in hand with mega-dam building projects, for instance. The idea is that they will establish inter-regional- or regional-level power grids driven by the technology provided by China’s state grid. And at that point, we’re talking about heavy-duty insertions of power. This would be a rewiring of economies and societies of a type we’ve never seen before—state building by means of electrification.
RA: As the West pulls back from aid globally, there are two questions: How much of that gap can China fill, and then, how much does it want to fill?
AT: Any rich country can do it, and any rich country with vision would seize the opportunity to do it.
So the question is, can China replace it? Absolutely. It has the resources. It has the dollar surplus. It has the ability to sell this to the population. It’s not an easy sell because the current generation of Chinese do not have the same connection to African liberation struggles as their grandparents. But still, the sell would be easy enough for the Chinese regime to do. So ability is not a question.
One question is about their learning process. Because the first wave of One Belt, One Road has not gone particularly well. This isn’t to diss the individual projects. But it’s clear that they got caught up in the same heavy lending boom to the low-income world in the 2010s. So they are trying to figure out now whether they have partners in the West to work this through. It will be interesting to watch how far China channels its lending through agencies like the World Bank or go it alone or mobilize the vehicles that it has created, like the Asian Infrastructure Investment Bank.
So does the regime have the vision to make this leap? Most of us missed it in the West, but in 2022-23, Chinese President Xi Jinping personally committed to China’s own version of the SDGs. But which of the many slogans that come out of Beijing get filled is a really open question. It would probably be in their interest to do it, but the question is, can they join up the dots? Are they able to make this work? Because none of this discourse about development and its failures should imply that we are confident in how to do it. Countries are poor for big, complex reasons. We’re engaged in different hypotheses about what might work. What are you willing to risk in an attempt to try to make a particular formula go? But right now, the only people even remotely in the game are the Chinese.
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