Cementing development and (un)steeling decarbonization: The political economy of infrastructure drive in Duterte's Philippines

Abstract

How do Chinese capital – foreign direct investments (FDI), development finance, and exports – and host country politics intersect in the decarbonization strategies of Global South countries? Existing works focus on either China's role in blunting or helping the transition from fossil fuels to clean energy, or they address the effectiveness of host country interventions. Both literatures pay little attention to host country politics, which can reduce the effect of their own decarbonization strategies. I argue that the option of pursuing infrastructure drives, defined as the buildup of physical infrastructures, gives host country leaders a perverse incentive to expand emissions-heavy cement and steel industries. This perverse incentive occurs in two ways. First, an infrastructure drive incorporates competing elites in the leader’s coalition. Infrastructure drives justify the use of public coffers to undertake new construction projects, which lead to a demand gap in cement and steel that incumbent firms cannot meet. This situation allows new imports of, and foreign investments in, cement and steel, allowing elites to participate as local facilitators or joint venture partners. Second, an infrastructure drive legitimizes the leader’s regime to society by targeting the unfulfilled demands of the populace. Countries in the Global South suffer from unemployment and inter-linked developmental problems that the infrastructure drive could answer in one stroke. The strategy creates a veneer of legitimacy that allows the infrastructure projects and the leader more specifically to go largely unchecked. I illustrate these arguments in Rodrigo Duterte's (2016–2022) Philippine administration using novel government databases and elite interviews.