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 Anonymous @ 14:50

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