6.7.6.1 The Politics of Aid

The giving of aid can be politically popular in donor countries and can, if given in the right way, help the recipients economically (3.5.8.1).  It can also make a positive or negative political impact on the recipients:

  • Aid can be offered with preconditions, to pressurise a government to behave better, as advocated by Larry Diamond in his article End Foreign Aid As We Know It; he suggested a strengthening of George W. Bush’s Millennium Challenge Account (MCA), which offers:

“sizeable increases in aid on the basis of three criteria: ruling justly (by providing freedom and a rule of law and by controlling corruption); investing in people (especially basic health and education); and promoting economic freedom”.

  • Such political leverage has had mixed results, though – as shown in E.A. Brett’s article, Explaining Aid (In)Effectiveness: The Political Economy of Aid Relationships, which “showed that aid relationships succeed when donors cooperate with progressive regimes, but confront major problems in fragile and fragmented states”.
  • It might undermine a government’s accountability to its people by ‘letting them off the hook’: making other countries responsible for providing people’s socio-economic rights. Dambisa Moyo eloquently made this point in her book, Dead Aid, reviewed in The Guardian article: Everybody knows it doesn’t work.

Aid is not a long-term solution to the problems experienced by developing countries.  They can only become independent and prosperous through development of good governance and economic capability within the country, as discussed next (6.7.6.2).

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