Dead Aid : Is Foreign Aid Ineffective?

Written on 09/02/2016

By Fergus Radburn-Todd


By definition, international aid is the movement of money, goods and services given by government of one country, or a multilateral institution to help another country. In recent years, international aid has become a highly controversial topic, with the rise in international aid to foreign countries and disaster hit areas around the globe. Described by many as a “moral duty”, many critics of this view argue that aid is in fact detrimental to overseas development in places such as Afghanistan, as it has encouraged dependency, or further entrenched corrupt dictators. Though there have been successful cases of international aid, it is often the case that aid distracts governments, both western and recipient governments from the real solution, trade. Aid can also tend to create a negative western stereo-type of suffering countries, such as the common view of Ethiopia as a disaster ridden nation which in time can prove disastrous, diverting international investment, leaving countries in a spiral of decline.

In times of crisis, non-governmental organisations are often among the first to donate resources, goods services and money. The United Nations currently estimates that there are now more than 37,000 international NGOs. The work of such NGOs are, in the eyes of many successful, and set a good example of how international aid when directed correctly can be hugely successful. More than 1,400 NGOs operating in 90 countries helped to get 123 countries to ratify the Ottawa treaty, which entailed the banning of landmines, which so far has been successful in 2 countries, which have been declared mine free. Indeed, following the devastating earthquake and ensuing volcanic eruption in the Democratic Republic of the Congo, which displaced around 250,000 people and destroyed around 80% of the local economy, the international community successfully funded and coordinated the creation of a volcanic observatory. The UN is perhaps the best example of an organisation delivering successful aid, in various situations. The UN Refugee Agency leads and coordinates international action to protect refugees and resolve refugee problems world wide. The General Assembly created the United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) to provide emergency relief to some 750,000 Palestine refugees, who had lost their homes and livelihoods as a result of the 1948 Arab-Israeli conflict. This was largely successful. It has, according to the organisation, resulted in 500,000 children receiving education, 3.1m refugees getting access to healthcare, 300,000 refugees getting support of some kind from a social ‘safety net’, and the lending of 360,000 loans to refugees to start businesses. Furthermore, according to Oxfam, “millions of children in Tanzania, Uganda, Kenya and Malawi are now going to school, thanks to a combination of debt relief and aid.” In these sense, international aid is effective. While governments are slow to react, or are considering the political implications of acting upon a situation, non-governmental organisations are able to act quickly, supplying what is often life supporting aid to people.

Despite this though, aid, from governmental donations on a regular basis to a developing country, to aid from a non-governmental organisation can create a situation of dependency within the recipient nation. Indeed, Moyo endorses this view, stating that aid creates a “culture of dependency in developing countries,” whereby governments expect a handout from the international community, rather than actually acting upon their poor situation. In fact, Moyo goes as far to state that “aid has helped to make the poor poorer and growth slower”. Though controversial, this is supported by such figures as the rise in poverty from 11% to 66% from 1970 to 1998, when aid to Africa actually hit its peak. As long as this culture of dependency remains, developing countries that require aid will often lack the entrepreneurial spirit required to actually build an effective, competitive economy. Moyo refers to this as the “micro-micro paradox” in which “short term efficacious intervention may have few discernible, sustainable long term benefits. Worse still, it can unintentionally undermine whatever fragile chance for sustainable development may already be in play.” Yash Tondon further supports this view, saying how African countries like Zambia and Zimbabwe became dependant to the assistance from international organisations and foreign governments, “filling a large amount of their annual budget with aid, rather than trying to mobilise their own resources.” Benjamin W. Mkapa, former president (1995-2005) of Tanzania has stated that “Development aid has taken deep root to the psyche of the people, especially in the poorer countries of the South. It is similar to drug addiction”. Moreover, in Ethiopia, the situation is a stark example, Ethiopia being one of the largest recipients of food aid in the world. Since 1984, more than five million people have been annually dependent on food aid, due to insufficient food production and recurrent food shortages. In 1999-2000, for example, of the estimated 62 million people in the country, 16% of the total population received food aid. At the same time, the amount of food aid as a share of Ethiopia’s foreign exchange earnings grew at alarming rate from about 2% in the 1950s to over 40% in the mid-1990s. In the eyes of Nietzsche, “The two great European narcotics”, were “Alcohol and Christianity”, as he believed they prevented people from acting upon their woes. This perhaps is the case with African aid, preventing actual change from being set in motion.

Furthermore, aid undoubtedly entrenches bag governments, which are too often corrupt. Critics of international aid argue that it is often sent to governments that are corrupt, and that poor monitoring means that there is no certainty that it gets through to those who need it. In the case of Mobutu Se Seko, a dictatorial African ruler, who ruled the Democratic Republic of the Congo from 1965 to 1997, this is extreme. Between 1962 and 1991, the U.S. directly supported Mobutu with more than $1.03 billion in development aid and $227.4 million in military assistance. Some of this was even reportedly used in the transport of foreign troops used to suppress anti-Mobuto rebellions in 1977 and 1978. The US, France and Belgium were also involved in supplying foreign aid to this country. This perhaps highlights the endemic nature of corruption in certain African countries receiving aid, posing that argument that such aid is only prolonging the authoritarian rule of such leaders, at the expense of the the population. Tim Butcher supports this view, in ‘Blood River’, making clear just how much corruption and bloodshed undermine the chance that a state like the Congo will achieve economic success, despite copious investment (from China for example), and aid. Sorios Samora has further highlighted the corrosive nature of corruption. In places such as Kenya, in which aid directly funded by British tax payers is syphoned off to fake organisations. Equally, it has recently become apparent that a major UK / World Bank funded development programme in Ethiopia may have contributed to the violent resettlement of a minority ethnic group. The UK’s Department for International Development was the primary funder of a World Bank-run development project aimed at improving health, education and public services in Ethiopia, contributing more than £388m of UK taxpayer funds to the project. Furthermore, in Chad, the Chad Export Project, an oil production project supported by the World Bank was shown to have funded the buying of arms by the Chad government. The government defended this purchase by stating that “development was not possible without safety”. However, the Military of Chad is notorious for severe misconduct against the population such as abuse, rape, and claiming of supplies and cars) and has failed to protect the population in various instances, such as during the Darfur conflict of 2008. Again, it has recently come to light that British aid has potentially indirectly funded Islamic extremism in Somalia, through foreign aid to the Somali government.

Despite this, many argue aid can promote democracy. In the view of Stephen Knack, from the World Bank, aid can potentially contribute to democratisation in several ways, such as through technical assistance focusing on electoral processes, the strengthening of legislatures and judiciaries as checks on executive power, and the promotion of civil society organisations. This can also be effective through conditionality, and through improving education and increasing per capita incomes, which research shows are conducive to democratisation. Foreign aid in the general context of development has proven to be successful in many situations. The Carter foundation has been successful in almost entirely eradicating the Guinea Worm disease in central Africa, while the UN’s has also been successful in many respects. Concerted action against Malaria has lead to a 38% drop in Malaria deaths in the past decade, with the UN seeking the total elimination of the disease by 2025. The eradication of AIDS has also been targeted for 2020, with significant reductions in infection rates in recent years. Such medial, social and educational reforms will certainly create a more socially cohesive society, in which better educated people will reduce the chances of countries falling into social decline. Moreover, the example of South Korea is stark. The Korean War decimated South Korea’s population and destroyed much of the country’s economic and military capacity. Since, the United States has been successful stimulating economic growth, investing roughly $35 billion in economic assistance. This perhaps poses as an example of foreign aid, and how it can be succesful when employed intelligently and with direction. Furthermore, the growth of the coffee industry has enabled Hutus and Tutsis to work together on many initiatives toward an improved standard of living, through directed foreign aid, to encourage economic liberalisation. This also shows how entrepreneurial spirit can work to unite past conflicts.

It is also the case though, that international aid can consolidate western stereo-types about countries. Events such as ‘Live-Aid’, run by celebrities such as Bob Geldof were perhaps the pioneers to a “new breed” of celebrity missionaries. As American journalist David Rieff has noted though, Live Aid’s donations to NGOs such as Oxfam and Save the Children have also facilitated the displacement of 600,000 people by the autocratic Mengistu regime, resulting in an estimated 100,000 deaths. Such events as ‘Live-Aid’ have contributed to a negative stereo-type that has diverted foreign investment into countries such as Ethiopia, despite their desperate need for investment.

To conclude, as with a person struggling with drug addiction is weaned off the drug, to prevent negative side affects and eventually reduce their reliance to nothing, Africa must also be done. If Africa’s growth rate is to be sustained, a concerted effort by western governments must be made to liberalise the economies to suit the international market, raising living standards and preventing war through integration and reliance upon neighbouring states. In situations where aid is necessary to prevent deaths, such as disasters or entirely failed states, it must be directed to the best ability of the donor through an any possible infrastructure, being invested with direction in a constructive effort to reduce poverty, such as in the case of South Korea, or the Carter Foundation’s practical removal of Guinea Worm from Africa, not simply one to satisfy the desires of an domestic party or wing, such as in the case of British aid to India currently. Western countries should also make a concerted effort to rebrand international aid as investment, rather than charity. This way Africa and other such developing countries can be views as an opportunity, rather than a burden. If this was to be fulfilled, international aid could be considered effective. Currently though, I do not believe international aid is effective, as it entrenches corrupt government, creates a negative stereo-type, and fosters a culture of dependency.




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