Adapted from a short essay for an International Political Economy seminar.
Africa. Sub-Saharan Africa is the least developed region in the world, home to two of the world’s most notorious failed states, 900,000 deaths caused by malaria, and sixteen of the twenty least developed countries. Amazingly, Africa has been a major focused on foreign aid campaigns for decades, and the continent shows no sign of improvement.
Why has the international aid regime failed so miserably in Africa (and in much of the world)? And what can be done—both by the donors and recipients of aid—to start to turn things around?
I’m approaching this discussion with one possibly controversial assumption. From a realist, rational-state-interest, perspective, foreign aid to Africa doesn’t make much sense. The genocide in Sudan, the decade-long civil war in the Democratic Republic of Congo, and the collapse of Somalia have had a negligible impact on the Western World. Even if these countries continue to collapse, it is unlikely the regional unrest would cause a serious threat to Western interests.
Moreover, as Ray Hopkins points out in his Political Economy of Foreign Aid, the end of the Cold War has rung the death knell for ideologically-drive foreign aid, and changes in the structure of domestic agriculture subsidies means that food aid is no longer driven by a need to inflate domestic food costs.
So why is the Western world giving money to developing countries?
Hopkins outlines four possible drivers in his chapter, including global public goods, economic development, domestic coalitions, and concessions from recipients. As I’ve outlined above, I’m not convinced that public goods or domestic coalitions explain aid to Africa. Moreover, most African economies are export-driven, and retrieval of resources occurs whether or not a country has a developed infrastructure. That leaves concessions from recipients. While I’m sure this plays a role, I don’t think it alone is enough to justify aid.
Ultimately, I believe that African aid is driven by a feeling of moral obligation on the part of developed states.
I’ll return to this point. Looking at the issue of aid to Africa, I see five major hurdles:
- African governments are notoriously corrupt, which means that the West cannot rely on the state alone to distribute aid.
- It is extremely difficult to measure the results of hundreds of small, scattered programs.
- Foreign aid offers no solutions—there just isn’t enough money, an idea Sachs expands on.
- Aid programs aren’t reliable. They tend to consist of cyclical spending so that, just when a country needs aid the most during a global recession, it is cut.
- For a system devoted to raising up the poor, remarkably few poor voices are actually heard in the planning process.
I don’t think that any of the programs suggested in our reading can solve all of these problems. I’m drawn to Sachs’ proposal of massive foreign aid—he suggests the developed world spends 0.7% of their national GDP in order to raise up the entire planet—which address the third concern.
However, I believe his call for “a mere 7 cents out of every $10 in income” from the developed world is wildly unrealistic. If aid is driven by moral obligation, it is extremely vulnerable in the budget-setting process. I fear that his proposal, if ever implemented, would just exacerbate the cyclical nature of aid explained by Hopkins and Sachs—thousands of doctors might be hired, hundreds of schools might be built, but when recession hit the developed world (and it seems to do so about every six years) these projects would be one of the first to go, completely rolling back changes across the globe.
Easterly recommends a program that would be supported by Brank Milanovic: results-driven transfers from the developed world to specific individuals or programs in the developing world. Easterly accurately points out many issues with current aid programs, particularly his critique that “nobody is actually held accountable for making this intervention work in this place at this time.”
While this kind of program could be a very effective approach for NGOs or individuals, I find it harder to imagine states circumventing central governments on a wide scale. Historically, states have shown themselves to be resilient partially because their bureaucracies are finely tuned to deal with other state-bureaucracies. Easterly’s plan just isn’t enough.
So I’d like to advocate a different kind of program. The developed world should pick a single African country to partner with—lets imagine Ghana, to build off of Sachs’ example. This country should both be in serious need of aid, and opt in to this partnership to deal with issues of sovereignty.
The first step in this development program should be to develop a long-term plan, endorsed by the government of the developing country, to meet all UN Development goals. After this plan has been assembled, the developed world should endow a central development agency with most of the funding required to execute the plan. When the state begins to enact the plan, the central agency should act primarily as an oversight organization to ensure that goals are being accomplished, and it should continually assess specific portions of the plan—if certain projects aren’t working, the central agency should work with the local government to alter those plans.
This development agency should also act as a clearing house for the kind of direct aid espoused by Easterly. Any individuals within the partner country could add their funding request to a central database maintained by the development agency, and the development agency or private donors could decide to meet those requests.
After the project is completed, the development agency should be accountable for the project. If it was successful, its experience and organization would be carried over to another partner. If not, the organization should be significantly restructured before moving on its next partnership.
So how does the aid program I’ve laid out deal with the problems previously outlined? It tries to deal with the issue of corruption and accountability by installing the development agency as a regulator. Because it would be working with a single partner for an extended period, the agency would develop expertise in the region. And because payment would be coming from developed countries, there’d be a smaller incentive for corrupt behavior.
The plan aims to fulfill Sachs’ goals, while being realistic, by focusing the development aid. This means that countries will have intense aid for an extended period—Sachs suggested five years for Ghana—and then the country would be able to function with a much lower level of aid. This project would not be a stop-gap measure. And this aid wouldn’t be at risk of vanishing, because the initial input into the development fund could cover recession years. Finally, by integrating micro-funding and a continual review process, the program could try to integrate more poor voices, building on the most successful efforts instead of developing and then executing a static plan.
By way of this Marshall Plan for developing countries, it might be possible to have real, lasting, success, instead of a series of disaster spots where aid at best delayed, and at worst abetted, disaster.
One of the texts I refer is The Sovereign State and Its Competitors. All other sources were articles or manuscripts.