Foreign Aid to Africa: A Hollow Hope?

Recent years have seen a surge in calls for more foreign aid to Africa in order to eliminate the continent’s poverty. International organizations, scholars, celebrities and philanthropists have all made renewed pleas for a massive infusion of development aid.  They generally present two arguments to justify more foreign aid to Africa. One family of justificatory arguments aims to establish the essential rightness of foreign aid and the West’s moral obligation to provide it:  Helping Africa through foreign aid is not only charitable, but morally correct, and repairs the conditions of injustice and inequality that permeate the international political economy. Redolent of the familiar “white man’s burden” to uplift the peoples of the “dark continent” from gloom, ignorance, and despondency, this justification derives force from its missionary zeal.[1]  Former British Prime Minister Tony Blair’s memorable description of the continent as a “scar on the conscience of the world,” as well as his insistence that the international community could heal it, is a classic illustration of this normative perspective on foreign aid to Africa.[2]

The second argument posits that injecting more foreign aid into Africa would materially benefit its people.  Jeffrey Sachs’s 2005 book The End of Poverty and the United Nations (UN) Millennium Development Goals (MDGs) have given this line of reasoning credibility and exposure.[3]  The UN Development Program (UNDP), for instance, claims that “aid provides governments with a resource for making the multiple investments in health, education and economic infrastructure needed to break cycles of deprivation.”[4]

These two families of justificatory arguments for sending foreign aid to Africa are logically independent of one another and are not mutually exclusive.  However, both lines of argument are problematic; I will critique each in turn. Ultimately, aid to Africa is a band-aid, not a long-term solution, and African leaders themselves are responsible for creating true, systemic change.

I. The Normative Argument

The principle of sending aid to Africa on moral grounds is problematic for two reasons. First, it reinforces the negative stereotype (held by some in the development policy community) of Africa as a “helpless child” and as a continent of “beggars.”  The implication is that Africa is clueless when it comes to its own development and would perpetually have to depend on foreign assistance (the fact that African countries are the largest recipients of foreign aid does little to rebut this impression).[5]  Second, the argument that this aid will break the structural cycle of dependency is disingenuous.  The fact is that none of the foreign aid to Africa is aimed at transforming Africa’s structurally dependent economies.  Indeed, the direction and targets of aid, thus far, have done little to empower and strengthen the continent relative to other actors in the global political economy.[6]  Moreover, those who champion the moral argument, when pushed, generally admit that their calls for intervention are self-serving and not purely altruistic.[7]  The primary “true” objective cited for African aid is to reduce poverty in order to provide a bulwark against terrorism.[8][9]

II. The Empirical Argument

As for the empirical argument, the evidence is overwhelmingly against those who argue that aid can lift Africa out of poverty.  The record shows that foreign aid has failed to deliver in any meaningful way.[10]  According to most estimates, the West has spent close to $600 billion on foreign aid to Africa since the 1960s.[11]  While scholars and practitioners disagree on the effectiveness of foreign aid in general,[12] the irrefutable fact remains that during a period when aid has risen over time as a percent of income in Africa, Africa’s growth rate has  concurrently fallen.[13]  Even the UN and World Bank have recently admitted that Africa, the region receiving the most aid, will not meet its development benchmarks by 2015.[14]

Aid advocates explain Africa’s abysmal development record despite huge aid inflows in two ways.  First is what I call the “aid quantity argument.”  Aid advocates argue that it is unfair and misleading to cite aid amounts in aggregate terms. They point out that while aggregating decades of aid provided to Africa may make that amount of aid sound significant, the average “receipts” per African per week or day are negligible.[15]  For example, a claim that Africa has received $500 billion in aid over a 50 year period averages to only about $10 per person per year or 20 cents per person per week.

Secondly, they point out that the amount of aid given to Africa is a drop in the bucket compared to the total national wealth of the Western developed countries .  One frequently cited example is that the United States, though it has the largest GDP in the world, spends only one hundredth of its budget on foreign aid to sub-Saharan Africa.[16]  In other words, they argue, the results of development aid are not discernable in Africa solely because very little aid has been provided.  Indeed, some aid advocates use this argument to call for further increases in the volume of aid to Africa.  This proposal, known as the “Big Push,” claims that a massive infusion of well-targeted aid is necessary to end Africa’s poverty.[17]

However, the aid quantity argument is a fallacy.  It overestimates the potential benefit of foreign aid by assuming that more aid money would automatically lead to more development.  It has been well documented that accountable leadership—not a lack of money—is at the heart of Africa’s underdevelopment.[18]  For example, the African Union (A.U.) estimates that Africa loses $148 billion (€114.28 billion), or a quarter of its entire gross domestic product (GDP), to corruption every year.[19]  It would be an understatement to suggest that some of these misused funds must come from foreign aid.[20]  Moreover, there is no evidence that more aid money would necessarily lead to favorable development outcomes.  This is because the total volume of aid, in and of itself, tells us nothing about how that money is disbursed or why a given aid-sponsored project succeeds or fails.

Given this poor investment performance, the challenge for the aid industry is to rethink aid delivery.  The most promising strategy on the table can be termed the “targeted aid” approach.[21]  Proponents of this strategy push not only for more aid, but for the right aid.  In other words, they claim that the impact of foreign aid depends on both its quantity and its quality.  Unfortunately, there is little evidence so far that the targeted approach works[22]  Further, as William Easterly and others have pointed out, is that aid donors and advocates have not learned from their past mistakes and thus will be likely to continue making them.[23]  Post-independence foreign aid in Africa has largely been wasted, mismanaged or misdirected.  If the targeted aid approach is to be meaningful to ordinary Africans, it must focus more on transcontinental projects, such as highways, telecommunications and power plants.  Such projects would transform Africa’s disarticulated infrastructures and improve its global position.  Of course, such projects raise the prospect of a united and empowered Africa—a goal Western donors have never championed.

Concluding Thoughts: the Way Forward

Foreign aid is not a panacea for Africa’s development woes.  So far, foreign aid has created a welfare-continent mentality and has become the hub around which the spokes of most African economies turn.  At the dawn of this century, more than 50 percent of sub-Saharan African budgets and 70 percent of their public investment came from foreign aid.[24]  This is unfortunate, particularly given that Africa is one of the most resource-rich continents.[25]  Dependence on foreign aid has compromised the sovereignty of African states.  Most aid packages (even those from charities) come with stipulations and conditions to which countries must adhere before further aid is disbursed.[26]  In the future, the link between aid and conditions will only grow tighter.  The Millennium Challenge Corporation (MCC), a newly created US agency, exemplifies this trend.  Established in January 2004, the MCC is based on the principle that aid is most effective when it reinforces good governance, economic freedom and investments in people.[27]  Simply put, countries that do not embrace capitalism and democracy will not be eligible for aid.

Africa’s development will not materialize from outside sources.   Thus, African leaders should take control of their countries’ economic destinies and find creative ways to finance development other than reliance on foreign aid.  What is the point of the continent’s gaining political independence only to sacrifice its economic independence before the altar of the donor community?  Africa’s leaders must break free from their aid dependency by harnessing the continent’s collective resources for the benefit of their people.  As a critical step toward this end, African leaders must take pan-African unity seriously and make real and substantive efforts to harmonize policies.


             * Dr. Kwame Akonor is Professor of International Relations at Seton Hall University (New Jersey, USA), and director of the university’s Africana Center.  He is also director of the African Development Institute (ADI), a New York based think tank that advocates self-reliant and endogenous development policies for Africa.  Dr. Akonor is the author of Africa and IMF Conditionality (Routledge, 2006) and was recently a post-doctoral fellow at the University of Cambridge (UK).

             This essay is based on the author’s statement at the 12th Annual Herbert Rubin and Judge Rose Luttan Rubin International Law Symposium, “The Future of a Continent:  Law and Policy of Sub-Saharan African Children,” held at New York University School of Law on October 29, 2007.

         [1].  Rudyard Kipling’s poem “The White Man’s Burden” (1899) was widely read as a moral calling or justification for Europeans to rule over and benevolently transform the primitive cultures of non-Western peoples, who were generally regarded as childlike and undeveloped.

          [2].  Tony Blair’s Speech to the United Kingdom’s Labour Party Annual Conference, 2 October 2001

          [3].  At the UN’s Millennium Assembly in September 2000, the United Nations agreed to a set of eight Millennium Development Goals (MDGs) for the world’s poor nations to be achieved by 2015.  The goals are: Eradicate extreme poverty and hunger; Achieve universal primary education; Promote gender equality and empower women; Reduce child mortality; Improve maternal health; Combat HIV/AIDS, malaria and other diseases; Ensure environmental sustainability; Develop a Global Partnership for Development.  For useful critiques of the MDGs, see: Samir Amin, The Millennium Development Goals: A Critique from the South, Monthly Review (March 2006); and William Easterly, How the Millennium Development Goals Are Unfair to Africa. The Brookings Institution, (October 2007).

          [4].  UNDP Human Development Report, 2005, p.7

          [5].  Jimi O. Adesina, Yao Graham, and Adebayo Olukosi (eds). 2006, Africa and Development Challenges in the New Millennium. London: Zed Books. P.262. See also, Djankov, Simeon, Jose G. Montalvo, Marta Reynal-Querol. The Curse of Aid, World Bank mimeo, April 2005.

          [6].  The structure of African economies today, notwithstanding the volume of aid, remains as it was during the colonial era. Most are integrated into the world economy as raw material producers and importers of manufactured goods, with very little control of pricing on the world market. (See, framework document of The New Partnership for Africa’s Development, NEPAD, www.nepad.org). The main critique here is that aid does nothing to address the systemic bias of the global political economy toward poor African countries, be it through trade barriers or intellectual property and migration regimes, to name a few.

          [7].  See, Blair confronts ‘scar on world’s conscience’, The UK Guardian, Thursday February 7 2002. A similar commentary is made by Professor Stephen Smith of George Washington University, in CQ Researcher, August 2005.

          [8].  The proponents of this line of thinking do not make a causal link between poverty and terrorism, but they stress that poverty increases the susceptibility to violent extremism.

          [9].  Op, cit.

        [10].  William Easterly, 2006, The White Man’s Burden: Why the West’s Efforts to Aid the Rest Have Done So Much Ill and So Little Good. Penguin Press.

        [11].  According to Dr. William Easterly of New York University, the West spent $568 billion on foreign aid to Africa between 1960-2000. in his talk “Can Foreign Aid Save Africa,”  Saint Johns University, Clemens Lecture Series, 2005

        [12].  There is vast literature on the pros and cons of foreign aid but for very up to date work, see: Sanjay G. Reddy & Camelia Minoiu, 2006. “Development Aid and Economic Growth: A Positive Long-Run Relation,” Working Papers 29, United Nations, Department of Economics and Social Affairs, and William Easterly, 2006, The White Man’s Burden: Why the West’s Efforts to Aid the Rest Have Done So Much Ill and So Little Good. Penguin Press.

        [13].  The inverse relationship between aid and Africa’s growth rates is aptly captured by Fredrik Erixon in Aid and Development: Will It Work This Time? (International Policy Network, 2005, p.8). Also available online, http://www.policynetwork.net/uploaded/pdf/Aid_&_Development_final.pdf

        [14]. According to the UN, “at the midway point between their adoption in 2000 and the 2015 target date for achieving the Millennium Development Goals, sub-Saharan Africa is not on track to achieve any of the Goals.” (United Nations, Africa and the Millennium Development Goals, 2007). The World Bank concurs with this fact its website, http://ddp-ext.worldbank.org/ext/GMIS/gdmis.do?siteId=2&menuId=LNAV01REGSUB6

        [16].  The National Priorities Project 2005, and Congressional Research Service

        [17].  For a good overview and critique of the Big Push idea, see Easterly, W. (2006) “The Big Push Deja Vu: A Review of Jeffrey Sachs’s The End of Poverty: Economic Possibilities for Our Time,” Journal of Economic Literature, 44(1), 96-105, March

        [18].  The unwise spending by Africa’s leaders is very well documented, but two books that capture this trend in a very easy to read format are: Martin Meredith, The Fate of Africa: From the Hopes of Freedom to the Heart of Despair (2005); and David Lamb, The Africans, New York: Random House (1983)

        [19].  Meredith, op, cit. pp.687; and “Our Common Interest,” Report of the Commission for Africa, March 11, 2005, pp. 33, 145; BBC News , Corruption ‘costs Africa billions’ Wednesday, 18 September, 2002, http://news.bbc.co.uk/2/hi/africa/2265387.stm.

        [20].  The case of Zaire’s Mobutu is a glaring example of such abuse.  However, there are numerous studies on the relationship between foreign aid and rent-seeking behavior or corruption.  The following are particularly relevant for Africa: Svensson, Jakob. “Foreign Aid and Rent-Seeking,” Journal of International Economics, 2000; Knack, Stephen. “Aid Dependence and the Quality of Governance: Cross-Country Empirical Tests,” Southern Economic Journal, 2004.

        [21].  A good example is Jeffrey Sachs’s call for aid that will combine “investments well attuned to local needs and conditions [to] enable African economies to break out of the poverty trap. These interventions need to be applied systematically, diligently, and jointly since they strongly reinforce one another.” (2005: 208)

        [22].  William Easterly, 2006, The White Man’s Burden: Why the West’s Efforts to Aid the Rest Have Done So Much Ill and So Little Good. Penguin Press.

        [23].  Bill Easterly, op, cit. makes a convincing case that targeted aid approach is likely to fail not only because the results of such efforts have been disappointing in the past but also because currently aid advocates have not mastered the history of aid approaches.

        [24].  The Fate of Africa: A History of Fifty Years of Independence, by Martin Meredith. (2005)

        [25].  Africa is the one of the richest continents on earth when it comes to natural resources and its known mineral wealth. (Encyclopedia Britannia)

        [26].  The suggestion here is that because aid donors seek ‘good’ policy environments in which to disburse aid flows, they are more likely to attach conditionalities. Of course, donors are not always successful in getting aid recipients to be compliant. For more on this literature, see, Collier, P. (1997): “The Failure of Conditionality,” in C. Gwin and J. Nelson (eds.), Perspectives on Aid and Development, Overseas Development Council; Mosley, P. , J. Harrigan and J. Toye (1995): Aid and Power: The World Bank and Policy Based Lending, 2nd edition, Routledge; and Oxfam (1995): The Oxfam Poverty Report, Oxfam Publications

       [27].  Information at Millennium Challenge Corporation, www.mca.gov

Dr. Kwame Akonor is Professor at Seton Hall University at the Dept of Political Science and Public Affairs in New York. He’s originally coming from Ghana, Africa. He was selected and honored for the 2010 College of Arts and Sciences Professor of the Year at Seton Hall Univ. In addition to his teaching duties, Dr. Akonor is also the director of the Center for Africana Studies and the African Development Institute, a New York based think tank.

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