Development Aid: Challenging Effectiveness

One of the biggest challenges plaguing the world today is poverty. Poverty is connected to a vast majority of the international community’s main concerns, such as lack of education, economic inequality, security, and freedom. As Nelson Mandela once said, “Overcoming poverty is not a task of charity; it is an act of justice. Like slavery and apartheid, poverty is not natural. It is man-made and it can be overcome and eradicated by the actions of human beings.” His sentiments exemplify the rationale behind development aid and projects. Development aid refers to financial support given by foreign governments and international agencies to support the economic, environmental, social, and political development of developing countries. An extension to development aid can also be in the form of technical assistance or expertise through projects that support developing communities to reach international standards, such as the Millennium Development Goals (MDGs) or the soon to be announced Sustainable Development Goals. Despite the lofty goals set by these international standards and occasional positive outcomes from development aid, the overall effectiveness of development aid in terms of alleviating poverty and achieving the MDGs in many countries is questionable at best.Most people believe that providing aid to impoverished populations is a responsibility of humanity. However, many critics question the true objectives of foreign donors. Critics challenge the effectiveness of foreign aid and demand justification of its potentially negative impacts, such as aid projects becoming for-profit businesses or development aid funding acts of war. For instance, a Carnegie Endowment for International Peace report explains how the United States gave Pakistan almost $19 billion in aid between the years 2002 and 2010. However, during the period from 2002 to 2008, only 10 percent of this money was for Pakistani development, while as much as 75 percent was for military purposes. Although the share of development aid has risen in recent years, it is still less than half of the total aid package given from the United States.Amid the innumerable projects conducted in Africa, it becomes imperative to question whether development aid is effectively providing the desired change of economic growth and human development. For example, Alexis Akwagyiram points out the fallacy of promoting economic growth at the expense of human development. Ethiopia was one of the biggest recipients of bilateral aid (US$504 million or £324million) from the UK government in 2011-12, and is one of the fastest growing economies in the world, expanding by about 10 percent every year since 2004. This positive growth has made the country attractive to foreign investors. Yet a third of the population continues to earn less than US$1 a day making Ethiopia one of the poorest countries in Africa. This discrepancy is largely because of a disconnection between aid and its objectives, thereby causing backlash and pushing aid recipients to act impulsively on the need to survive. For instance, Ethiopia and Rwanda have been forcing thousands of people off their land so it can be leased to foreign investors. Aid objectives should serve the overall goal of serving both economic and human development, so one does not have to pay the price for the other.A large number of development aid projects focus on short-term poverty alleviation instead of long-term solutions. Too frequently, aid creates a sense of dependency that takes away the potential to use resources within a country to an extent. A Brookings Institute report estimates the share of international development aid devoted to agriculture has fallen from 20 percent to about 4 percent in the last 30 years. Aid to cities, where an estimated 1 billion slum dwellers live in developing countries and most population growth originates, is only US$1-2 billion a year. The United Nations also estimates that 54 per cent of the world’s population lives in urban areas, a proportion that is expected to increase to 66 per cent by 2050. Comparing these figures, it is evident that there is an inherent lack of prioritization based on resources and information. The problem is not with aid but with its application, or in some cases, the power to make decisions as a donor. The question is not if aid should be devalued, but if aid can be applied more thoughtfully and effectively.The problem of ineffective aid is largely generated by a lack of accurate information on aid recipient needs and therefore a poor disbursement of resources. This gap in information can be tackled by identifying critical areas of development that map aid-centric target areas and aid-centric priorities. Among several priorities, one that particularly demands attention in an increasingly globalized world of expanding economies and technological advances is the need to update development-based education and skills programs in digital literacy. Access to this knowledge will create employable individuals that can easily enter the work force, or maximize the utility of individuals who are self-employed. At the same time, these digital literacy programs have to be complemented by the development of a transparent governing body within developing countries. It is of utmost importance to create a system that is accountable and effective so as to restore the recipient’s power to participate and make decisions as well as to restore their faith in the true objectives of aid. Development projects should help create local leaders that can facilitate common goals and ideas that benefit the society as a whole. It is important to focus on building local relationships and networks that eventually help build dignity and motivation within the recipient state to be self-reliant in the long run.