Does Green Overseas Investment Improve Public Perception in Host Countries? Evidence from Chinese Energy Engagement in 32 African Countries

This study examines whether and how green overseas economic engagement impacts public perception in host countries as a form of soft power. We build an extensive country-level dataset on Chinese bilateral engagement in 32 African countries from 2015 to 2019 and use a fixed-effect model. We find that increased investment in green energy improves the average public perception of China. In contrast, for non-green energy investment (like coal, gas, and oil), which might also be considered as contributing to economic and employment growth, we did not find such effects. The results indicate that green economic engagement has positive non-monetary returns on the macro-scale and that by taking environmental considerations into investment decision-making, long-term bilateral relationships can be positively impacted.