Trouble with Aid: Why Less Could Mean More for Africa

by Jonathan Glennie

Overview

In this book, Jonathan Glennie argues that government aid to Africa actually has many very harmful effects. He claims that aid has often meant more poverty, more hungry people, worse basic services for poor people and damage to already precarious democratic institutions. Rather than the Make Poverty History slogan "Double aid to Africa," Glennie suggests the opposite: "Halve aid to Africa"--to achieve the same result and reduce aid dependency. Through an honest assessment of both the positive and negative consequences of aid, this book will show you why.

Product Details

ISBN-13:	9781848130401
Publisher:	Zed Books
Publication date:	12/09/2008
Series:	African Arguments Series
Pages:	192
Product dimensions:	5.00(w) x 7.70(h) x 0.50(d)

About the Author

Jonathan Glennie is director of policy and research at Save the Children UK, as well as a visiting fellow at the International Development Institute at King's College London.

Read an Excerpt

The Trouble with Aid

Why Less Could Mean More for Africa

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By Jonathan Glennie

Zed Books Ltd

Copyright © 2008 Jonathan Glennie
All rights reserved.
ISBN: 978-1-84813-368-6

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CHAPTER 1

Time to think again

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? Millions of people in the rich world, moved by images on television and disgusted by the miserable poverty endured by so many people in other countries, have joined campaigns to persuade their governments to give more aid to Africa and help put an end to such shameful inequality. It is not even much of a sacrifice – by any measure rich countries are incredibly mean with their charity, giving between 0.95 per cent (Norway) and 0.16 per cent (the United States) of their annual incomes to countries much poorer than their own.

The year 2005 saw the biggest campaign for more aid the world has ever seen. The Make Poverty History campaign in Britain, which culminated in a 250,000-person march in Edinburgh for the Gleneagles G8 summit in July, was supported by the ONE campaign in the United States and movements and marches in countries across the globe. At the same time the Live 8 concerts were watched by over a billion people and provided a reminder of the first Live Aid concert twenty years before, perhaps the first time the global public joined together in horror at unnecessary suffering in Africa. The campaigns of 2005 were remarkably successful. Millions of people were mobilized on issues that do not directly affect them, and the key demand – more aid – was fairly well answered by the governments of rich countries. In the United Kingdom, ending poverty in Africa became a serious political issue in an election year, with all the main parties lining up behind the campaign's main demand. First the countries of the European Union, then the G8 group of the world's richest countries, pledged vast increases in their aid giving to Africa, doubling 2005 amounts in a matter of years. In the United States, where aid was already going through an exponential revival in its fortunes, the ONE campaign used the momentum of 2005 to build a supporter base now totalling almost 2.5 million people for its headline demand that the country give at least 1 per cent of its annual government expenditure in aid. All fourteen major presidential hopefuls in the US 2008 election, Republican and Democrat, pledged continued increases in aid to Africa to combat disease and hunger. One, Mike Huckabee, demonstrated a worthy, if naïve, personal commitment by promising 'I will build water and sanitation infrastructure and invest in increasing agricultural productivity.' If only it were that simple. This statement is instructive because it demonstrates the fundamental lack of understanding of the complex political channels through which aid is spent, which characterized all the presidential candidates and many of those who, out of sympathy and a sense of justice, demand more aid.

When I first became involved in the global movement to end poverty, calling for more aid seemed to me to be the most obvious of all the things campaigners could do. More aid equals less poverty. More aid equals more schools and hospitals. More aid equals fewer children dying of preventable diseases. More aid equals more roads and infrastructure to support developing economies. It seems simple. But it isn't. Official aid to Africa (that is, money given by governments or international financial institutions funded by governments, as distinct from private charity giving) has many harmful effects that have actually increased poverty in Africa and put off the development of states capable of fulfilling the rights and needs of African citizens. In reality, in many African countries aid has meant more poverty, more hungry people, worse basic services for poor people and damage to already precarious democratic institutions. Over time, looking at the reality of aid, checking the statistics, and talking with people who see how aid has set back their country's development rather than strengthened it, I have slowly come to accept that aid is not the answer to Africa's poverty. Government-to-government aid will always have an important supporting role to play, a role it has played with occasional success over the years. In some countries in the world, depending on their economic and political contexts, aid increases may be appropriate and helpful. But most countries in Africa, rather than seeking more aid, should be reducing the amount they accept. This book will explain why.

Many of those who fondly remember the euphoria of the Live Aid concerts of 1985 have grown to be seasoned campaigners on development and African issues. And the movement for change has grown up with them. What started as an outpouring of emotion has had to get smart. The contrast between an Irish rock star begging viewers to 'Give us your fucking money' and the highly complex demands of the recent Trade Justice campaign, with its analysis of everything from import tariffs to investment regulation, could hardly be more striking. Nevertheless, while campaigns to help the poor of Africa have certainly diversified, that central logic espoused so inspiringly by Bob Geldof in the mid-1980s has remained constant. There are campaigns on everything from fairer trade to women's rights, primary education to climate change. But when the really major campaigns get going, the main answer to the question 'How can rich countries best help poor countries?' is still, 'Give more'. The difference is that a call for personal donations (the Live Aid concerts raised tens of millions of dollars from individual givers) has developed into a demand that governments give more – and not just millions, but tens of billions of dollars more. And governments of the rich nations have responded. Aid is rising year on year, although the ambitious targets set by donors have not been reached. In the words of the new Secretary General of the Organisation for Economic Co-operation and Development (OECD), 'We are talking here about an increase in official development assistance [ODA, the technical term for official aid] of a magnitude and in a time frame that has never been attempted before in the history of the aid effort.' In percentage terms the global aid increases are more significant in Africa than anywhere else (not counting the vast sums of money currently being spent in the post-war Middle East). Official data show ODA to Africa either doubling or almost tripling since the millennium, depending on which figures you use, with predictions of more increases in the years to come.

But the optimism that a big aid push will make a big difference to the lives of poor Africans is not shared by most analysts on the African continent. While there is broad agreement in the 'international development community' in donor countries that more aid is a good thing (even though there is disagreement about how it should be spent), African commentators, who are aware of the real effects of aid over the last decades, tend to be more ambivalent. There is a range of views on the issue; the debate about how to finance urgent needs in Africa is a complex one. But while most African governments generally work hard to increase the amounts of aid they receive, African civil society, such as non-governmental organizations (NGOs, often charities), labour unions and social movements, is not vocal in calling for more aid. African analysts appear not to believe that huge aid increases are the way to achieve growth and development. Many explicitly reject the idea, and it is hard to find a single example of an African NGO that is actively campaigning for aid increases. In a literature review, Moses Isooba of Uganda's Community Development Resource Network found that, 'A majority of civil society actors in Africa see aid as a fundamental cause of Africa's deepening poverty.' He goes on to acknowledge that aid can make 'a lasting difference in helping people to lift themselves out of poverty', but calls for a radical rethink about the purpose and nature of aid giving. Charles Lwanga-Ntale of Development Research and Training (DRT), a Ugandan NGO, describes what he perceives as 'almost unanimous pessimism among African civil society and academia about the unworkable nature of aid, given the way in which it is structured and delivered'. According to Siapha Kamara of the Social Enterprise Development (SEND) Foundation of West Africa, 'mainstream African civil society, especially the emerging independent grassroots based development agencies, think tanks, research and policy advocacy organizations are justifiably asking what is different in the present day international aid architecture. Official Africa tends to be more enthusiastic about the anticipated increase in international aid than civil society ... the more African governments are dependent on international aid the less ordinary citizens such as farmers, workers, teachers or nurses have a meaningful say in politics and economic policies.'

Why? Why should so many experts in Africa, and not only in Africa but across the world, question the good aid is doing them? Is it sensible to suggest that aid could be 'a fundamental cause of Africa's deepening poverty'? Do a 'majority of civil society actors in Africa' really believe so? And why should receiving more aid mean that ordinary people have less of a 'meaningful say in politics and economic policies'? While most people in rich countries consider aid to be a simple act of generosity, Africans understand its far more complex nature. In this book I look at some of the reasons why so many Africans are against more aid. Aid has many impacts, some obvious, some subtle, some quantifiable, some hard to measure, some not really important, some fundamental. Direct impacts are the easiest to measure and are the ones we hear about most in the media – how many people have been vaccinated, how many schools have been built, and so on. But also in this category, and perhaps not publicized quite so much, are the harmful side-effects of aid, such as when people are displaced by large projects like dams and mines. Even more controversial are the policy conditions attached to aid, which have arguably had greater consequences in the lives of Africans than the direct consequences of the way the money has actually been spent. Within two decades the whole economic direction of a continent has changed, largely as a consequence of aid, and while some people have gained, many more have suffered as a result. It is generally agreed that shortcomings in the accountability and effectiveness of African governments in recent decades have been a major part of the problem of low or negative growth and insignificant poverty reduction. What is less discussed, but is becoming increasingly clear, is that dependency on aid from foreign donors has undermined the development of the basic institutions needed to govern and the vital link of accountability between state and citizen. This has retarded African development in fundamental and long-lasting ways. It is what Kamara was referring to when he talked about ordinary people not having a meaningful say in decisions about how their countries are run. Finally, receiving large amounts of aid also has macroeconomic consequences because large inflows of foreign money affect prices and incentives. If they are not managed well these effects can be very damaging to poor people. These issues are discussed in more detail in Chapters 3 to 6 of this book.

Following months of pressure around the globe for more aid the G8 met in Scotland in July 2005 and released a communiqué promising substantially more aid, though not all that was being demanded. One leading UK NGO (Oxfam, but it could have been any) commented that, 'The G8's aid increase could save the lives of five million children by 2010 – but 50 million children's lives will still be lost because the G8 didn't go as far as they should have done. If the $50 billion increase had kicked in immediately, it could have lifted 300 million people out of poverty in the next five years.' This kind of claim is common on the campaigning circuit. Campaigners need to make clear statements about the impacts of policies. But even allowing for the fact that mega-calculations will always be more than slightly arbitrary, but are still important in order to convey something's magnitude, this statement is highly misleading. Why? Because it is made on the basis of a very lopsided analysis, which looks only at the most direct and positive outcomes of aid. If one considers only the positive column in the balance sheet, ignoring all the damaging consequences of aid giving, it is certainly possible that, if spent well, aid money could have the kinds of benefits alluded to. Aid spent well can put children through school, build infrastructure and save lives. But what about all the other impacts? What about those who will lose their livelihoods because of bad policies forced on poor countries by aid conditions? What about the long-term consequences of consistently immature and unaccountable state institutions? What about the possibly harmful effects on exchange rates and prices with the serious consequences they might have on workers and consumers? Where are these impacts taken into account when we calculate millions of lives saved per billions of aid dollars spent? Nevertheless, this kind of simplification is common in all sectors of the aid community. Gordon Brown, British Prime Minister and respected economics heavyweight and champion of ending poverty in Africa, has stated simply: 'Let us double aid to halve poverty,' while the United Nations has for years publicized a similarly neat calculation.

Some who have criticized aid have simply called for it to end. Others have gone even further and argued that there is virtually nothing helpful the West can do for Africa. I don't share either conclusion. Yet I do want to challenge the simplistic notion that more aid equals less poverty, and to suggest a new way of approaching aid. I am going to insist that we look at the evidence. All the evidence. In contrast to aid optimists and aid pessimists, who selectively use evidence either to support or dismiss aid, I emphasize that the impacts of aid are complex, some good, some bad. Only when we assess these impacts dispassionately and systematically can we have any real expectation of making a positive and sustained impact on human rights, development and poverty reduction in Africa. I call this approach aid realism. 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, first to see how it can be improved and second, 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.

We should emphatically not conclude that the West should therefore somehow leave Africa alone. The corollary of the argument 'something must be done – give more aid' has often appeared to be 'well if aid doesn't work, nothing can be done'. This is very far from the truth. African civil society, while heavily criticizing aid, is not sitting on its haunches in despair, and nor should anyone else. There are many positive measures that rich countries should take right now in order to help Africans reduce poverty and improve human rights. In fact, it will be almost impossible for African governments to reduce their reliance on aid without the international community taking a range of supporting measures. If the first reason to stop campaigning for aid increases is that aid may be doing more harm than good in some countries, the second is that all the emphasis on aid is obscuring the far more important policies the West should be adopting to help Africans out of poverty. The fact that aid dominates our thinking is one of the reasons that these other, more important, actions are not being taken – rich country leaders are not feeling enough political pressure to make the important changes. Aid is easier, and it benefits donors, never mind all the problems it brings with it. I look at these issues in more depth in the last two chapters of the book.

I know it will be troubling reading for some who share something of my own journey, and for many around the world who have only so recently celebrated the renewed commitment that has been wrung out of Western governments to make aid to Africa a priority. But we need to look at the reality of what aid to Africa can mean and to question the assumptions which have dominated for too long, because unless we do we could end up being complicit in making poverty in Africa even worse and deepening the already vast gap between the world's richest nations and those which are home to the world's most desperately poor. Aid increases may harm efforts to reduce poverty and improve governance and sustainable development in most African countries. Those concerned with development in Africa need now to recognize the evidence and challenge generalized calls for more aid. (These arguments do not relate to private aid giving from charities and NGOs, which has few of the harmful consequences of large-scale official aid, partly because it is relatively small, and partly because it is spent very differently.)

(Continues...)

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Excerpted from The Trouble with Aid by Jonathan Glennie. Copyright © 2008 Jonathan Glennie. Excerpted by permission of Zed Books Ltd.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

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Table of Contents

1 - Time to think again
2 - The new aid era
3 - All aid's impacts: The bigger picture
4 - Pulling the strings: The reality of aid conditionality
5 - Institutions, institutions, institutions
6 - Aid, growth and confused academics
7 - A better future?
8 - Why is aid really going up?
9 - What is to be done?
Notes
Bibliography
Index