Aid that threatens developing economies

Sat, 15 Oct 2011 Source: Yeboah, Stephen

Aid that threatens developing economies – informing agenda for Busan

Aid contributes to the fight against poverty and hunger in developing countries. It is also increasingly argued that aid is hurting developing countries especially those in Africa. In past decades, Africa has witnessed more aid than any other continent. According to the 2011 ONE Data Report, total development assistance for sub-Saharan Africa reached $39.7 billion in 2010, representing an increase of $13.5 billion over 2004 levels.

It is hard to understand the paradox of aid. It is incredibly disappointing the region that receives more aid is today the poorest continent in the world apart from the valuable natural resources at its disposal. Even with increased foreign aid, it is overwhelmingly evident that about 51 per cent of people in sub-Saharan Africa live on less than 1.25 dollars per day.

The disparity between aid and effective development has therefore generated unprecedented debate regarding whether or not Africa really need aid to combat the ever-increasing poverty, hunger and economic backwardness. The Rome Declaration (2003), Paris Declaration (2005) and Accra Agenda for Action (2008) meant to rethink the architecture of aid have been necessary but have barely made impact. The declarations and commitments constitute talks without action. The thirteen measurable targets set by the Paris Declaration only had one target been realized as revealed by the 2011 Monitoring Survey of the Development Assistance Committee (DAC) of the Organization for Economic Cooperation and Development (OECD). It is sobering and worrying indeed.

This is a stark reminder that aid is not effective and as such it’s making the poor poorer and the rich richer. It is widening the gap between rural and urban settings. Development and progress is at a standstill if not dwindling.

The causes of aid ineffectiveness are not far-fetched. The world does not need a miracle to make aid affect poverty. It is about getting right priorities, cooperation and real commitment to global development. Aid commitments are falling short apart from aid being used as a tool to threaten developing economies. The potential global recession has seen aid threatened to be cut. Britain has made the stance to cut aid made available to developing economies. This scenario created -- I choose when and what to give out. Though Obiageli Ezekwesili, World Bank’s Vice President for Africa has warned the temptation to cut aid to Africa would be a great mistake, the warning cannot move donors not to act. David Cameron has threatened to cut aid meant for Ghana and Uganda this year for their dealings with homosexuals. Britain has done it already to Malawi. The UK government has cut aid by $30 million to Malawi after two homosexuals were sentenced to 14 months hard labor for having an engagement ceremony.

Is aid obligatory or out of a country’s wish? Britain can decide the amount and time of giving out hand-outs to needy economies. The ‘beggar has no choice’ syndrome has outlived its significance. Developing economies should own what they receive. Aid in uncertainties unsettles the priorities of developing economies. Shouldn’t aid commitments be made certain to inform development agenda of less developed economies? Threats to cut down or withdraw aid only vindicate aid ineffectiveness and unfulfilled commitments. Accra Agenda for Action’s (AAA’s) ownership of programmes of aid is just a mirage. Donors decide and aid with strings attached dictates what to do or otherwise.

Busan should clearly define what commitments to aid are. Commitments should be made to go beyond the rhetoric. Vocal commitment is glaringly putting development at risk. Over 13 million people are in danger to life-threatening hunger in the horn of Africa, increased child and maternal mortality is gradually putting Africa on the brink of extinction and hopelessness, and civil war is apportioning enough time for tensions and killings.

Africa dare not depend on aid. Commitments are the sole wishes of donors. They decide what and when to give. If aid pursues this pathway, then aid will be needless for ‘needy’ economies.

It is not surprising when aid does not meet its aspirations. It is because donors clamour for secrecy. They support opaque deals. According to Publish What You Fund, a number of donors seem to be ”attempting to dilute or undermine” commitments to aid transparency “by removing all references to the International Aid Transparency Initiative” and implementation deadlines during the “Working Party on Aid Effectiveness” meeting in Paris this week. When Africa loses nearly $150 billion a year through pervasive corruption, it stands to reason that transparency is a precondition for real aid. How much is invested in poverty and hunger reduction programmes? Only donors and governments of developing countries are aware of what goes out and what comes in. Citizens have been turned spectators -- watching just for the fun of it while they are bear the brunt of poor utilization of those funds.

If aid is for democracy, then citizens reserve the right to know. The right to information is what democracy demands. The ‘Arab Spring’ revolution had enough of increasing secrecy and needed openness. The light should be shed on what governments are doing with the few stipends at their disposal to improve the lots of the poor.

I put this question to leaders that would be gathering during the 4th High Level Forum on Aid Effectiveness in Busan -- Is the aid regime teaching Africa to fish. Or is aid driving Africa to fish in water without fish or dead fish. This trend puts progress developing economies at risk.

In all, achieving the Millennium Development Goals by 2015 should set the motion for a new transparent architecture of aid that makes poverty and inequality a priority. Women are poorer and lives of children are threatened by malnutrition and hunger. The future of developing economies is bleak and hangs in uncertainties. This should inform Busan.

Busan should set new standards and mandates for aid effectiveness that go above the too much talk. Less of that, Africa should think inwardly for a development miracle. Effective development in developing economies especially those in Africa is now and never tomorrow.

The author Stephen Yeboah is a development practitioner and freelance journalist. He is a Research Fellow at Centre for Social Impact Studies (CeSIS), research and advocacy non-governmental organization. He can be reached at [stephenyeboah110@yahoo.com]

Columnist: Yeboah, Stephen