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Category Archives: Unit 5 – Aid and development

Unpredictable aid

If I had to choose a word to best characterise aid it would definitely be: unpredictable. But I think I wouldn’t be the first one to choose so. Almost every author, paper or report I have lately read had that same adjective somewhere. That was very much the common point through them all.
Unpredictable aid in terms of amounts, where it goes to, what it is used for, who benefits from it, what results it achieves, if any. In the Western world, people got used to hear the reverberation of huge sums of money flowing into Southern countries but they never get feedback on the results.

There was a striking point for me, which was the amount of aid and support that circulates among Southern countries – non-DAC states (Smith 2011 and OneWorld).
Many of these states help others in need for years, with a particular advantage that at a given moment in time they were assisted too by others. Southern countries have the particular knowledge of how the aid process actually works (Smith 2011b) in terms of inflows of money, where it should be applied and what entities could better manage it for the maximum results.

From my point of view, these countries can hold the response to preoccupations from donors and aid practitioners: they are probably in a more privileged position to put in place a worldwide set of guidelines and norms for the whole aid community to follow and make aid-related data actually comparable – what Barber (2010) calls the “rules of the game”.
Like during the Cold War, there’s a window of opportunity for developing countries to play their power. The difference here is that this power is no longer of exogenous origin but of an endogenous one, based on the actual financial capacity of these countries (Graig, Hulme and Turner 2007). I argue that southern countries have a unique chance to reverse positions and actually emerge leading the shift in the international aid scene (Smith 2011c).

I also think this discussion should occur even before the one on aid effectiveness and proliferation of donors and projects or at least at the same time, as the former will improve the later.

Disclosure of Aid Numbers

Western countries’ ODA – Official Development Assistance – supports developing ones for many reasons, ranging from altruistic to political or financial impetus. The later ones are argued by Easterly (2009) to delink aid from principles. OneWorld gives the example of Ethiopiaas the largest recipient of aid in Africa but “is routinely using access to aid as a weapon to control people and crush dissent”, according to theAfrica director of Human Rights Watch.

Easterly or Moyo argue that aid misguides governments priorities and ultimately they respond to what donors would like to see instead of what locals actually need. They say “international donor community has done more to distort poor economies than improve them” (in Graig, Hulme and Turner 2007b).
Critics state that disclosing exact numbers of aid would cut down corruption and increase transparency and ultimately lead to accountability (Killick 2004) and credibility of aid agencies. The 2005 Paris Declaration and Accra Agenda for Action by DAC countries is an attempt to boost transparency but as well to reconcile donors and aid practitioners.
Easterly and Williamson (2011) have gone through the 2008 numbers and noticed there was a “slight improvement in transparency” but it is “still at unacceptably low levels”. The proliferation of projects and donors doesn’t certainly help in the transparency side neither does on the cooperation in good practices.

I find it very interesting to watch the ambiguity of countries that are on the front line of the defence of Millennium Development Goals (MDG), paying considerable sums to end poverty but in parallel protect their own economies with “high trade barriers against poor countries’ products” (Easterly and Graig, Hulme and Turner 2007c).
The proportion of the trade tariffs is indeed impressive. According to UNDP figures used by the same authors, OECD states placed tariffs on manufactured goods from poor countries at four times the level of those from wealthy nations.

I tend to agree with Easterly and Moyo on the role trade has to play in improving poorer countries’ capacity to make their way into the virtuous cycle.

The Millennium Project itself recommends developing countries what I understand to be the perfect strategy to leave the vicious cycle: to “actively pursue international trade opportunities, demand access to rich countries markets” and “demanding more effective aid to alleviate internal supply-side product blockages” (Graig, Hulme and Turner 2007d).

The strategy is there: progressively open up for trade on the one side and on the other, aid effectiveness. However, this does sound slightly utopian at this point in time. While this double game played both by wealthier and poorer countries lasts it is easy to anticipate thatAfricawill fail to reach the MDG.

References:
Barber, O. (2010), Aid effectiveness after Paris, [online] http://www.owen.org/blog/3348, [accessed November 5th 2011]

Easterly, W. (2009), How the Millennium Development Goals are Unfair to Africa, World Development. Vol. 37, No. 1, pp. 26–35, 2009 [online] http://williameasterly.files.wordpress.com/2010/08/56_easterly_howthemdgareunfairtoafrica_prp.pdf [accessed November 6th 2011]

Easterly, W. and Freschi L., (2009), Why Does British Foreign Aid Prefer Poor Governments Over Poor People?, Aid Watchers, [online] http://aidwatchers.com/2009/03/why-does-british-foreign-aid-prefer-poor-governments-over-poor-people/ [accessed November 6th 2011]

Easterly, W. and Williamson, C. (2011) Best and Worst of Official Aid 2011- new release, Aid Watchers, [online] http://aidwatchers.com/2011/05/rhetoric-on-%E2%80%9Caid-effectiveness%E2%80%9D-keeps-escalating-is-there-anything-to-show-for-it/ [accessed November 6th 2011]

Graig, A., Hulme, D. and Turner, M. (2007) Challenging global inequality: development theory and practice in the 21st century,London: Palgrave Macmillan

Killick, T. (2004), The case against doubling aid to Africa, ODI, [online] http://www.odi.org.uk/events/documents/45-presentation-tony-killick.pdf [accessed November 6th 2011]

OECD, Paris Declaration and Accra Agenda for Action [online] http://www.oecd.org/document/18/0,3343,en_2649_3236398_35401554_1_1_1_1,00.html [accessed November 6th 2011]

Smith, K. (2011), Non-DAC and Humanitarian aid: Shifting structures, changing trends, Global Humanitarian Assistance, [online] http://www.globalhumanitarianassistance.org/wp-content/uploads/2011/07/GHA-non-DAC-donors-humanitarian-aid1.pdf [accessed November 5th 2011]

 
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Posted by on 09/11/2011 in Unit 5 - Aid and development