Africa is poor. If we send it more money it will be less poor. It seems perfectly logical, doesn't it? But it isn't. Along with its many benefits, government aid to Africa has often meant more poverty, worse basic services and damage to already precarious democratic institutions. Calls for more aid are drowning out pressure for action that would really make a difference for Africa's poor. Rather than doubling aid to Africa, it is time to reduce aid dependency. This book will show you why.

Sunday, 24 August 2008

NGOs: the wrong side of Paris?

First posted on the blog on 15 August 2008

The Colombian government appears to have found a new policy document of choice. Rather than arriving at donor-recipient meetings armed with the latest dossier of stats showing how dreamily everything is going, government officials now turn up brandishing the Paris Declaration. Colombian NGOs are confused and rather nervous. Instead of discussing how to make a frustratingly slow process work better (which is what seems to be happening in many other countries), they have been left wondering whether they need a strategy to mitigate the damage the Declaration could do to civil society’s already limited room to manoeuvre. Why? How has Colombian civil society found itself on the wrong side of Paris?

The heart of the Paris Agenda is an emphasis on gradually transforming aid so that it supports, rather than undermines, recipient government priorities and institutions. The focus on ownership and alignment stems from an acknowledgement that in many aid recipient countries donors have sought both to set the policy agenda in an undemocratic and ultimately disastrous fashion, and to try to achieve development independently of the state. Many aid recipient countries will benefit from this renewed focus on partnership.

But what about countries where the state is not weak? What if donor cooperation is already well-aligned with recipient government preferences? In Colombia, where I work, aid demonstrably supports the government’s development model. This is most clear in the hand-in-glove relationship enjoyed by the Colombian government with the US administration, but is also apparent in its relationship with the European Union, the second biggest (although far smaller) aid donor to Colombia. A balanced analysis of the pros and cons of foreign aid in Colombia could not possibly identify lack of up-joinedness between donors and recipient as a priority.

The problem in Colombia is not a weak state but an overbearing one. Without writing a detailed critique of the present Colombian administration, one of its most distasteful features is a tendency to harass critics, especially human rights defenders and vulnerable communities that don’t happen to agree with its version of reality. Armed groups claiming to support the government go a step further – it is a rare and happy day when I don’t receive an email denouncing another atrocity against a trades union leader, community organiser or politician. As civil society seeks to reemerge as an organised political actor after years of murder and threat, government figures not only brand it as inefficient and misguided, but condemn its leaders as friends of the guerrilla – a lie. The Colombian administration is wildly popular, which only make life harder (and more dangerous) for those who dare to oppose it.

Donors should have two urgent priorities at this stage of Colombia’s history. One is to continue to strengthen state institutions. But the other equally pressing need is to build up those other parts of the state, including citizenry, which must hold those institutions to account. Many aid officials understand instinctively the importance of protecting civil society, the media and opposition voices, especially in a context of armed conflict. The European Union has so far made a point of distancing itself from much of the more bellicose priorities of the Colombian and US governments. Most official donors keep plenty of funds ring-fenced to support work that distinctly does not meet with government approval, supporting communities and organisations that stand up for human rights and dignity in the face of attempts by the government and its allies to undermine them.

But how long will they resist pressure to tow the government line? Colombian civil society has devoted much energy in the last five years to sitting down with government and donors and thrashing out an aid strategy for the country that it can live with. Human rights leaders are now concerned that the Paris Declaration will tip the balance the way of the government, and that those most needing international assistance (political as well as financial) will lose out. Will the government be able to use the Paris Declaration to strengthen its desire to control aid money further, and undermine international support for critics or opponents? How much will the government be able to scrutinise donor funding and influence where it goes? There is only a finite amount of aid cash after all, especially in a middle-income country like Colombia. With even more pressure to fund government initiatives, will there be less money for non-government schemes. Will indigenous, afro-Colombian and peasant communities which vehemently oppose neo-liberal policies and seek to protect their ways of life find it harder to access funds?

Accra should address these concerns head on by placing a much greater emphasis on the role of civil society. Rather than the uni-directional call to align donors with recipient government priorities, the Paris process should emphasise a twin agenda – supporting the state but also building up civil society. It is not only Colombia where this is important. In all aid recipient countries where the state needs to be supported and strengthened, so does civil society.

A mature government does not seek to silence its critics; it encourages debate. Colombia does not need more alignment – it needs opposition voices to be heard and protected. It needs alternative development models to be tried and tested, in safety. It needs a powerful and effective civil society to make sure basic human rights are respected. It needs the international community to play its part not in making the executive stronger, but in making democracy more real.

posted by Jonathan Glennie @ 14:57

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Sunday, 10 August 2008

We should moderate calls for aid

First posted 24 July 2008 on The Guardian's Katine website

Sub-Saharan Africa is poor. If rich countries send it money it will be less poor and people living in poverty will be better off. It seems perfectly logical, doesn't it? Moved by persistent poverty in Africa, millions of people have joined campaigns to persuade their governments to give more aid to Africa. But it is not that simple.

Our focus on increasing aid is obscuring the far more important things that rich governments can do to help end poverty in Africa. And while aid often does a lot of good, when we look at all of aid's impacts, not just the positive side of the balance sheet, the picture becomes less black and white. And less rosy.

Not even the most optimistic of aid's advocates believe aid is that important for African development. Yet somehow it always emerges as the campaign of choice when we want our governments to do something. Far more money flows out of Africa each year than arrives there in aid, but where are the campaigns to stem illegal capital flows going through tax havens?

Rich countries need to overhaul the rules on international property rights and foreign investment. They should act on climate change and invest more in transferable technology. They should regulate better an arms trade causing turmoil in Africa, among many other things.

By constantly focusing on aid, we are letting developed country governments off the hook on these issues, all of which are more important for poverty reduction and democracy in Africa. Campaigners can muster a limited amount of political capital. We should not be spending it on aid.

The other reason for moderating our calls for more aid is its ambiguous impact for the poor in many countries. Aid can do good. Emergency aid is often the only way to respond to crises, and development aid spent well can be life-saving and life-changing. Millions of children in Burundi, Malawi and Kenya are going to school free of charge, helped by aid. Vaccination programmes against diseases such as diphtheria, tetanus and river blindness are among the most conspicuous of aid's successes. And infrastructure can be improved. Botswana used aid wisely to spur growth and poverty reduction (before HIV/Aids struck).

So we should not be pessimistic about the good aid can do – it will always play a helpful accompanying role. But nor should we be naïve about what is achievable by scaling it up. We need to be realistic about aid's impacts, not least so that we don't raise expectations too much. Botswana is an exception in Africa. Good news stories are only one side of the aid coin.

Official aid to Africa (that is aid given by governments as distinct from private charity giving) also has negative impacts that, far from helping poor people, have often meant more poverty, more hunger, worse basic services and damage to already precarious democratic institutions. Do these negative impacts outweigh the good done by aid? Some people, including many African campaigners, believe the answer is often yes.

Why? Donor governments attach strings to their aid. Across Africa, aid-dependent countries have been pressurised into implementing policies that have weakened their capacity to reduce poverty and have, ironically, made them even more reliant on aid. From cashew farmers in Mozambique to cotton workers in Kenya, key industries have been devastated by these aid conditions. While aid is helping African children to attend school on the one hand, aid conditions have weakened African businesses on the other, putting hundreds of thousands of parents out of work.

Some aspects of aid giving have improved in the last decade. But with a few exceptions (including, on good days, a rather contradictory UK government), donors are still using aid to pursue their own strategic interests and are resisting calls to reform. Should Africans continue to accept a raw deal, or are there better ways of financing development? Increasingly, analysts are suggesting that there are.

Aid dependency has also undermined the accountability of the African state to its citizens. African voters and civil society organisations complain that their governments, now in their third decade of heavy aid dependence, are not accountable to them. When governments rely more on aid than taxes, they listen more to donors than taxpayers.

The effectiveness of Africa's civil institutions has also been affected, with policymakers growing used to having their ideas rejected by donors. Analysts talk of a 'policy vacuum' at the heart of the Tanzanian government, describe Ghana's budget as a 'deceptive mirage', and identify a 'mentality of aid dependency' in Mali, leading to the loss of the 'habit, capacity, and incentives to set up and implement their own policies.' This problem could worsen if, as donors promise, aid as a percentage of recipient government budgets increases yet further.

A balance has to be struck between filling the financing gap and fostering the development of mature democratic institutions. That could mean reducing aid in some cases and focusing on other types of development funding. Aid is complex. More is not always better.

posted by Jonathan Glennie @ 14:50

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Friday, 1 August 2008

Response to Duncan Green's review of my book

First posted on 22 July 2008 as a comment in response to Duncan Green's blog assessing my book. Duncan Green is a respected development economist who is presently Head of Research at Oxfam. He describes the book as "crisp and well-argued" but is not convinced by my conclusions.

Hi Duncan,

I am pleased you liked (most of) the book. It was written for campaigners, students and all those interested in progress in Africa. The focus of Oxfam’s FP2P work, as you point out, has some important coincidences with the thrust of my book, which I hope contributes to the debate about where Africa should be seeking the money it needs to develop, and what the role of western governments could be.

Let me just respond to two of the issues you raise in your piece. I know I need to steel myself for having my views slotted into the “anti-aid” camp, and I suppose it is inevitable that my book will be seen by some as an “anti-aid salvo”, but it isn’t. I am not an aid pessimist – aid can do a lot of good and there is a case for increasing it in some African countries, most obviously Botswana. I am no more anti-aid than I am anti-foreign direct investment or anti-market or anti-state intervention. I am pro-all of these things when they support development and poverty reduction and anti-them when they don’t.
I am an aid realist. Aid optimists, are using the evidence selectively to make their case for big generalised increases of aid, just like aid pessimists do. To quote a little extract from the book:

“Aid realism means not getting swept away by the ethical clamour to ‘do something’ when a proper analysis shows that what is being done is ineffective or harmful. And it means not bowing to an ideological anti-aid position in the face of the rights and urgent needs of millions of people. It means carefully analysing the overall impact of aid on Africa, firstly to see how it can be improved and secondly, and more importantly given that improving aid will be a very hard job, questioning aid’s importance in relation to other policies and factors that influence development and poverty reduction in Africa.”

As I argue in my book, a combination of harmful policy conditionalities and the unforeseen consequences of aid dependency (a new phenomenon only seen in a handful of countries outside Africa) has meant that in many countries in Africa, the impacts of aid are ambiguous, with negative impacts possibly outweighing positive. While acknowledging some progress in improving the impacts of aid I argue that the key problems either persist (in the case of conditionality) or are worsening (in the case of institutional accountability and effectiveness). If aid doubles to Africa by 2015, almost three quarters of African countries will rely on aid for over half of their total public expenditure, according to an IMF projection, with almost half receiving over 75% of their government expenditure in aid. I like FP2P’s focus on active citizens and effective institutions (exactly where I would put the emphasis as well), but there is a serious danger that this scenario could undermine rather than underpin progress in these areas.

In such circumstances it becomes sensible for African governments to plot a course to reduced aid dependence over the next 10 – 15 years. You can’t just cut off aid and nor would you want to. But you can begin to take the steps necessary to reduce and replace it. Meanwhile in most of the poor world (India, China, Latin America) aid is negligible as a % of GDP. In neither circumstance does campaigning for a lot more of it make much sense.
Which brings me to my second point. I agree with your instinct that NGOs sometimes prefer to criticise than to propose – it is something we need to constantly be aware of. Which is why my final chapter is full of proposals (!!!).

Firstly I describe how Africa can reduce its dependence on aid by accessing other money streams, from stemming capital flight and debt payments to developing other revenues, reforming tax and banking systems, sometimes using policies frowned on and blocked by aid donors. Then I present a range of important things western governments can do to demonstrate real generosity, not just the sop of more aid. From fair intellectual property rights rules to the brain drain, from migration to the arms trade, from climate change to investment in vital health technologies, from reforming tax havens to regulating foreign investment – these and many more issues are the ones we should be focusing on, that would make a real difference to Africa. Most important of all is policy freedom, the right and duty of African governments to develop and make choices (and mistakes) as they see fit. Incidentally, I argue that while transfers of money to Africa may not be the answer, donors should meet and surpass the 0.7% target, but spend the money on developing transferable climate, health and other technologies which would have many positive impacts but far fewer negative ones.

The campaign against poverty in Africa has matured since the early days when more aid seemed like the best solution. We have learned a lot and most of us work on many other issues besides aid. But we only have a limited amount of collective political pressure, and while aid remains the number one priority, vital political energy is sapped from other more important campaigns. Isn’t it time to take the next step, to take our foot off the “more aid” pedal, and to persuade our government and others to do things that will make more of a difference?

posted by Jonathan Glennie @ 15:31

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