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.

Monday, 15 September 2008

Anything but the plaster

It was, I presume, one of those classic tussles of which my publishers will be veterans. My first reaction to the cover design they sent me was: looks great, a clever idea carried out well graphically – but no way.

Although the book is balanced, original and propositive, I know there will be some who will assume that it is ‘anti-aid’ and negative, and try to write it off as ‘heard it all before’. My book tries to carve out new territory, not fall back on what is one of the biggest clichés in the business, that aid is just a ‘sticking plaster’. In discussions while I was writing the book and since, some commentators have argued against things I don’t say in the book, but which they assume are my arguments. I was worried by a cover that appeared to give them ammunition.

Another option I was shown was more positive. Here it is with the wrong title (trying to agree on a title was a whole other story!).

I quite liked this alternative cover, despite the Little Chef logo meant to represent food security (I presume), because it looks positive and reminds me of funky wallpaper. But the publisher insisted that the 'plaster' cover was receiving great feedback from bookshops and ultimately I bowed to their expertise.

In many ways the book does argue that aid is like a plaster. It has some very positive effects, while failing to get to the root of the problems. And aid also covers up those very problems, making it harder to deal with them. It’s just that there is so much more to it than that. While it is common to argue that aid is good but not enough, in my book I explain how aid can actually harm development in many countries. Plasters don’t do that.

But I suppose no cover image can comprehensively describe the contents of a book. So we’ll let the cover stand. And it does, at least, look good.

posted by Jonathan Glennie @ 05:27

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Sunday, 14 September 2008

Some handy endorsements

Some of the things I say in this book are controversial. I have already had to field angry phone calls from colleagues in the aid industry who disagree with my arguments. It is always good, therefore, to get strong endorsements for the book.

Samuel Gayi, the leader of the team that writes UNCTAD’s annual (and highly respected) Economic Development in Africa report, thinks it is a “must-read”:

The Trouble With Aid: Why Less Could Mean More For Africa highlights the “central paradox of aid.” The book presents a challenge to both aid optimists and aid sceptics through an in-depth and perceptive analysis of the multidimensional and "complex impacts" of aid, and associated policy conditions, on the lives of the poor, institutions, and government policies of recipient countries.

“Jonathan Glennie offers a refreshing and insightful departure from the polarized views that have dominated the aid debate. He rightly points out that aid could be beneficial as well as harmful to its recipients; and "…the act of aid giving in itself undermines both state capacity and accountability", although this need not necessarily be the case and depends on how aid is used and the conditions attached to it.

“The message of the book is particularly timely as it exhorts governments to use aid efficiently and effectively for it to make a real difference to the lives of poor people at a time when donors are struggling to meet their own aid targets. The call for enhanced domestic financial resource mobilization ("minimizing outflows and maximizing domestic resources") is critical if recipient governments are to recapture their policy space that has been ceded out to donors and the multilateral financial institutions in a lop-sided aid recipient-donor relationship.

“The book is well-structured, and written in a clear, fluid, succinct, and engaging language that enthrals the reader to the end. It is a must-read not only for students of Development Studies/Economics, but also for development experts, politicians and policy makers in recipient and donor countries as it brings critical insights to even some old perspectives.”

David Woodward, the former head of New Global Economy Programme at the New Economics Foundation in London (nef) is another respected aid economist who found the book useful:

"Jonathan Glennie's excellent and immensely readable new book presents a compelling case for those of us who care about Africa not to demand ever more aid, but rather to seek the more fundamental changes in the global economy which could reduce dependency on aid and contribute to the ultimate eradication of poverty."

Charles Mutasa is the Director of the African Network on Debt and Development (AFRODAD), the largest grouping of African civil society organisations working on issues of aid and debt. He thinks the book is timely:

"At last a book on Aid by a colleague from the North that speaks frankly to the fundamentals of aid and how it is delivered. What Jonathan has given us is not just his perspectives but the new insights into the constraints on development in the Third World. The book cannot be ignored, those who ignore it, do it at their peril. This is an issue we cannot relegate to the archives or the sidelines of development."

Finally, Alex Wilkes also liked the book. Alex is the head of Eurodad, the European Network on Debt and Development. Like Afrodad it is a network of all the most important European NGOs working on aid - over 54 in 17 countries. He says:

“A very informative read for anyone interested in the future of development policy. Glennie challenges some widespread assumptions about development aid and broadens the policy agenda for campaigners. A well argued account of aid's problems and potentials and the importance of other policy agendas if we are serious about helping Africa. Readable, reasoned yet radical; Glennie urges governments, campaigners and others to look beyond aid and consider other ways to help impoverished nations and citizens stand on their own feet.”

I hope you like it too. It is published by Zed Books as part of its African Arguments series and comes out on 4 November 2008.

posted by Jonathan Glennie @ 15:55

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The myth of charity

First posted on my Cuentos y Chismes blog on 17 April 2006, while working in Mexico City.

The now-developed world has spent much of its energy in the last few hundred years ripping off today’s poorer countries. Most Mexicans I know are well aware of this, while at the same time despising their own political elite for doing the same. That the Spanish and Portuguese plundered Latin America is not a matter of dispute – nor is the USA’s heinous involvement in some of the worst dictatorships of the modern era. Astonishingly, Haiti had to pay $21 billion (in today’s money) to the French as the price of its independence in the early 19th century – it has never recovered from its history of plunder and debt. God knows where Colombia’s gold is.

Britain has its own rather less than glorious history of taking other people’s things and justifying it in various specious ways. But we, along with other Western countries, appear more or less oblivious to this, regarding it as something like ancient history. I gave a talk recently in one of England’s top schools and asked when the students thought Britain’s last colony gained independence. The first answer was, "1905?"

When Tony Blair announced the G8’s promises at Gleneagles he said he wanted to replace our relationship of "charity" with poor countries with one of "partnership". Apart from this being nothing new – the same rhetoric has been used for decades – it was annoying that he can still get away with the idea that we are charitable. We are not. Cancelling debt is portrayed as an act of tremendous generosity – our complicity in the roots of debt and poverty is not examined. British civil society has a job to do to remind people of some of the facts as revisionist theories of Empire (such as Niall Ferguson’s dire TV series) appear to be gaining ground. In France, apparently, they have actually passed a law insisting that a positive spin is put on French history in schools.
The present emphasis in development circles in the North on ramping up aid is linked to this skewed view of our past and present. What is an important but relatively minor element in the fight against poverty has been elevated to the position of cornerstone (architects will forgive me if this is in fact impossible).

More poor people (living on less than $2 a day) live in Mexico than in the whole of Central America. But doubling aid to Mexico will mean that inflows still account for only 0.04% of GNI – insignificant. What are significant are the vast outflows, both legal and illegal, that leave Mexico every year to be invested in the USA or hidden in tax havens. What is significant is the continued failure to levy sensible taxes – tax revenue is well under 20% of GDP compared to almost 40% in the UK. What is significant is the continued pressure to free up trade, which will hurt those who most need help and investment. What is significant is the continuing fallout of Mexico’s debt crises (debts of middle income countries have grown exponentially in the last two decades – the occasional rescheduling or bailout has done little to mitigate this trend). The same is true for most countries in the region and the world – 2.3 billion of the world’s 3 billion poor live in countries that receive under 3% of their GNI in aid (most receive a lot less).

There are a few dozen countries for which aid is of great significance. Nicaragua is one of them, receiving more aid per head than almost any other country in the world – most others are in Africa or are small islands. But then another set of problems arise – might there be negative impacts of increased aid? Probably, yes. It is perfectly sensible, regrettably, to conclude that the biggest impacts of official aid to poor countries in recent decades have been the neoliberal conditions attached to it. Changes in trade rules, bad privatisations, and the liberalisation of financial flows may well have had a more serious negative impact than the benefits of more cash in hand. And aid can retard institutional development too, with most evidence suggesting that countries receiving aid have less incentive to raise taxes, perhaps the fundamental step developing countries need to make, both to increase the resources available to the public sector to finance development and to improve governments’ accountability to their citizens.

The Ugandan government presently gets as much money from aid as it does from tax revenue. Under some projections aid to Africa is set to triple by 2015 – few believe that tax revenues will follow suit. Despite serious attempts by DFID and other donors to improve accountability and ownership it is naïve to suppose that present complaints about governments being more responsive to donor preferences than to their own citizens will improve as the statistics get more skewed.

Talking of evidence, there is simply no robust evidence suggesting that aid leads to economic growth (which is unfortunately the best proxy we have in the literature for poverty reduction). Even those studies that find a positive relationship under certain circumstances cannot agree what those circumstances are. In a paper published last year Nancy Birdsall, Dani Rodrik and Arvind Subramanian (respectively the head of a respected, relatively orthodox, think tank, an eminent, slightly less orthodox, Harvard economist and the IMF’s head of research) argued that "financial aid and the further opening of wealthy countries' markets are tools with only a limited ability to trigger growth, especially in the poorest countries. The tremendous amount of energy and political capital expended on these efforts in official circles threatens to crowd out attention to other ways in which rich countries could do less harm and more good." The paper goes on to suggest actions rich countries could take which would have a far greater poverty reducing impact: reforming TRIPs, giving countries far more policy space, confronting bribery and corruption by western actors, investing in technology that would benefit poor countries, and improving the cross-border mobility of labour. There are many others, most importantly helping prevent capital flight and helping ensure that foreign investment has a better impact on poverty reduction.

None of this is to discount the important role aid has played, and will hopefully continue to play, in improving the lives of millions of people. NGO aid in particular has been shown to respond to the needs of the poorest and has few harmful conditions. But we have to get real. Aid is a bit player in the history of poverty reduction. It has become the centrepiece of the new era of development because it is the easiest thing rich governments can do to respond to their electorates’ occasional horror at continuing extreme poverty (and in the case of Gordon Brown, Hilary Benn and others, an inspirational passion to end it), not the most important. In the post-9/11 context, it is also likely that aid will continue to be used to augment political partnerships. While DFID has made bold statements on reforming conditionality (largely because of immense campaigning pressure) there is little sign yet that other donor governments will follow suit.

The Independent newspaper, in one of its lucid editorials on Iraq, suggested that history students a hundred years from now would get poor marks if they claimed that the Iraq war was about WMD. They would do better if they demonstrated an understanding of the political and economic drivers of the war, oil being important. This is a helpful way to analyse the present day. While the British civil service (and public) spent the nineteenth century believing it was playing a civilising role in the affairs of its colonies, history students today understand the economic exploitation that was tied up with occasionally generous instincts. What will history students write in 2106? Is aid partly a smokescreen to disguise continued exploitation?

A lot changed in the 20th century – compassion in particular appears to have made a welcome return to humanity’s list of priorities (despite the eighties!). But whichever way you look at the world its plentiful resources, financial as well as natural, continue to satisfy the desires of only a very small minority. The world is more unequal than ever and until we become less fixated on trash TV (guilty) and mobile phones (not guilty) and more concerned with actually sorting this shameful trend out it will continue. Giving more aid will simply not do it, even if it is also ‘better aid’.

In the nineteenth century the British claimed to be "civilising" the world (you may have noticed the rhetoric of "civilised" and "uncivilised" making a triumphant comeback in recent years). I wonder whether today, despite our rhetoric of "charity", we realise how similar our practices are to those of our predecessors. The time is long overdue to explode the myth of charity.

posted by Jonathan Glennie @ 15:02

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Jonathan Glennie