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Sunday, October 24, 2021

Foreign Aid: Is this what Africa really need?

Aid has traditionally been seen as something temporary, something that can only complement existing national resources and efforts. After almost forty years in existence, aid has become something permanent. Furthermore, in some countries like our own, aid has become a considerable force in the national economy, making them more or less completely dependent on it.


During the last five to ten years, aid has been the subject of heated debate. This debate has not only dealt with isolated features of aid, but has touched on the fundamental justification for aid. The debate has been triggered by a combination of events and changes in the post-war world economy. First, the security motives for aid have largely disappeared with the ending of the Cold War. 


Second, as a result of the changes in Russia and Eastern Europe, the competition for available aid resources has increased. Third, donor countries in Western Europe have faced economic difficulties, forcing them to concentrate their economic policies on combating budget deficits. The public sector has been the chief victim in this process of budget balancing. As part of the public sector, aid has had to face the same adjustment demands as the rest of the sector.


Fourth, trailing economic growth in donor countries has sparked vigorous economic policy debate. There has been a much stronger emphasis on market forces, rather than state-led growth. This has spilled over into aid practices, where donors have become much more concerned with policies for achieving growth, rather than maintaining high levels of aid flows. This has led to questioning the automatic link between addressing needs and helping recipients and providing aid.


Finally, there is aid itself. Without doubt, there has been growing disillusionment with the performance of aid. Fighting poverty by supporting economic growth and development in the least-developed countries has been and continues to be a major objective of aid. However, in many countries it has been difficult to see any positive connection between aid and growth and development.


Africa is a particularly sad case in this respect. Our region has fallen behind the rest of the developing world by virtually any measure. The gap between Africa and the rest of the developing world continues to grow. Is aid a major cause of this development? Or has it prevented an even worse decline in living standards? Or has it had no effect at all? As long as aid agencies and host countries are unable to provide clear answers to these questions, aid will be under fire. Aid effectiveness will therefore continue to occupy a central position in the debate on development in Africa.


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