Analysis of Dambisa Moyo´s Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa

They also called for reform of the humanitarian response and development assistance, to enhance resilience and promote long-term solutions. Also, the US supports developmental assistance over military aid. ThinkAfricaPress states “Western governments look set to increase their military support for Sahelian and Saharan countries. But they do this based on incorrect assumptions, misguided objectives and questionable methods. At best, this trend will cost a lot of money and lives, and achieve little. At worst, it will lead to a worsening spiral of violence, producing the very outcomes Western powers fear.”

Whilst raising money for African charities at school I developed an interest in global inequality and alternative policies that can help low-income nations escape the poverty trap. Reading ’23 Things’ by Ha-Joon Chang, I was intrigued by his view on blaming free-market policies like SAPs that exposed sub-Saharan Africa to international competition, slowing economic growth. Hence, this extended my research to the other side of the

Riddell, Roger C. 2007. Does Foreign Aid Really Work? 1st ed. OXFORD: Oxford University Press, USA.

Modern African states have various problems ranging from corruption, to armed conflict, to stunted structural development. Africa’s ongoing political instability and economic crisis have hindered the improvement of Africa. Thus, the lack of money, advancement in technology, and climate has hampered economic development. Despite European mistreatment and oppression African’s have endured hardships that have encouraged economy, education, and political

The JSTOR Review by Kristian Hoelscher on the book Dead Aid elaborates how Moyo “half-right” in her critique of foreign aid nonetheless Hoelscher mentions how “her review is unfortunately shallow and lacking nuance” in the areas of acknowledging the successes of aid in Africa. Additionally, another review of JSTOR by S.U. Fwatshak reiterated how “aid could not have been the fundamental reason why Africa poor… African’s problem are rooted in a mosaic of a factors (157).” These two reviews provided to be good sources to shed light on the issues of foreign aid and to counter-balance the Moyo’s critique on aid. Lastly, the book is quite short with only one-hundred and eighty-three pages therefore it seemed so like some concepts needed to be elaborated more but were not. On the other hand, the reason I choose this as a source because it does a suitable job in showing the history of aid, speaking on aid effectiveness, and exemplifying the stagnant economic growth (e.g. ten percent Africans are living in poverty in the 1970s compared to seventy-percent now (Moyo 33)). While, I wished the book concentrated more in a section of Africa, such as Sub-Saharan, it was an insightful and factual

This paper assess the positive and negative effects that peace and war, respectively, have on the distribution of foreign aid in the developing country Sierra Leone. Next I will analyze the specific actions that the leadership of the selected Sierra Leone has taken, through the use of its foreign aid from donor nations and international lending institutions, to relieve the severe problems caused by warfare. Lastly I will discuss whether or not the extension of foreign aid has successfully reduced poverty and the incidence of warfare in Sierra Leone.

The large cash injection would then create a “greasing the gears effect” and allow for the jumpstart of economic development. Between the years of 1948 and 1952 the U.S. granted $13 billion to revamp the European economy (Dambisa, 2009: 35). This particular method achieved great success in post-World War II Europe and was known as the Marshall Plan. Due to its effective and unquestionable success in this era, the model was applied to economic development in Africa with the confidence that the same outstanding results would ensue. However, the application of the Marshall Plan to Africa is problematic for three reasons. One, the Marshall Plan had a rigid duration period of five years while, the concessional loans and grants to Africa over the last 50 years have been unending (Dambisa, 2009: 36). Two, European institutions were already in place to receive the aid efficiently and effectively. In Africa, however, these same institutions are either non-existent or grossly ineffective due to corruption (Dambisa, 2009: 37). The vast amounts of corruption have been heavily documented. Mobutu Sese Seko, President of the Democratic Republic of the Congo from 1965 to 1997, for example, stole an equivalent of U.S. 5 billion dollars from his people (Dambisa, 2009: 48). However, even the less corrupt rulers of many African countries had few options as to what to invest the aid money on. Consequently, the bulk concessional aid goes directly into consumption without a variety of investment outlets. This process does not solve the problem but instead, allows for the cycle to continue. Lastly, three, the money from the Marshal had specific targets to repair physical infrastructure such as, roads, communications, sewage, factories, and electric systems (Dambisa, 2009: 37) In Africa today, the scope of the

The main point of Banerjee and Duflo’s Poor Economics (2012) is that aid is neither good nor bad: there are instances where it can help greatly and instances where it can fail those it seeks to help(4). Aid is a powerful tool, therefore it’s imperative that we carefully select the right types of projects (Banerjee & Duflo, 2012, p. 4-5). Banerjee and Duflo (2012) present a few key points of action as a framework for approaching aid, with the broadest issue being the idea that too much responsibility is placed on the poor in making the most basic decisions (268-69). One example that Banerjee and Duflo (2012) offer is the fact that many of the poorest people don’t have sanitary water

In came into vogue that economic theory could benefit Third World countries, so humanitarians began to evaluate the best ways to help Africa through the markets [Barnett 100]. Furthermore, leaps were made in bolstering the efficiency of aid efforts, and it was discovered that the most effective systems were conglomerations of the state and NGOs [Barnett 107-108]. This may suggest that humanitarian efforts were transformed into vehicles for disseminating governmental and economic agendas, but conversely, aid organizations wished to increase their impact by cooperating with governments and the markets. Humanitarians were growing to appreciate the codependence of these avenues and that “everything was connected to everything else,” so they leveraged this new insight to the Africans’ benefit [Barnett

Unprecedented increases in living standards came with large increases in income inequality, both between countries and between individuals (p. 167). Too much inequality will create a wealth and power imbalance that stymies growth and development. Similarly, his acknowledgement of the fragility of the successes achieved in the developed world are prescient; there is nothing to say that the alleviation of poverty, deprivation, and poor health will continue forever, and any number of threats – including climate change, political failures, epidemics, and warfare – could bring it to an end. However, in the final chapter, titled “How to Help Those Left Behind”, his arguments are far less compelling. Deaton’s perspective on foreign aid and its efficacy is narrowly defined, and his claim that foreign aid is doing more harm to developing economies than good does not consider development successes that occur on the

However, the effectiveness of aid in countering these problems is seen to be small as the effect of Western economic dominance on restricting developing countries trade is seen to be too great. Libertarian Johan Norberg wrote, ‘According to the United Nations Conference on Trade and Development, EU protectionism deprives developing countries of nearly $700 billion in export income a year. That's almost 14 times more than poor countries receive in foreign aid.’ Norberg is showing that even with aid, developing countries are still in a state of perpetual famine and lack of development as Western protectionism is causing them to lose billions of pounds in lost revenue each year, something which can only be improved through liberating the markets instead of giving more aid.

Most of the developing countries are mired deeply in economical obstacles, which prevent them from development significantly. In order to overcome those embarrassments world’s society struggles to find the efficient solution for poor countries’ economies. Historically, developed countries undertook policy of giving aid to their colonies, afterwards by the end of The Second World War the United States and United Nations embarked the global sponsorship to the developing countries and countries of the Third World due to humanitarian considerations. Since then many other countries have joined in the effort to provide financial aid to lesser developed or poverty ridden countries. But none of those countries that received an aid had experienced a prosperity phase and rapid economic growth.

Over the last 50 years, the world has struggled to maintain an economic balance and stability, while flourishing countries try to maintain a steady income to support its people and relations with other countries. Therefore, when a continent like Africa fails to maintain a stable government and economy, super powers such as America decide to intervene with its relations. Africa has great potential to become another pillar of the world’s economic structure with its mass amounts of uncultivated land. Unfortunately, corruption and irresponsible governments hinder that progress. Foreign aid while helpful should be limited to a yearly amount because it allows the government to repudiate responsibility and gives room for corruption; it creates a

Harvard Business School’s Case Study “Aid, Debt Relief, and Trade: An agenda for fighting World Poverty” outlines the steps, and missteps, that the world community has taken since World War II to address the efficacy of international assistance. The study focuses on international financial institutions (IFIs) and their ability to help poor nations break out of poverty and the possible obligations of rich, developed countries to assist the heavily indebted poor countries (HIPCs). Additionally, the study seeks to see if this assistance has been and can be parlayed into growth and investment for the HIPCs.

When one person sees another person struggling, the human response is to try to help. People helping people is what the institution of foreign aid is built on. Ideally, foreign aid is a way for people in developed nations to help people in developing nations. Unfortunately, foreign aid does not always bring a positive outcome. In many area where foreign aid is abundant, economic development slows. Foreign aid has become a controversial topic because in some way it saves lives, but in others it keeps undeveloped nations undeveloped. Foreign aid helps the developing world by bringing vaccines, and helping to advance healthcare systems, but at the same time, foreign aid cripples the developing world by halting the growth of local businesses, undermining government responsibilities, and promoting corruption and dependence. The goal of this paper is to find the balance of where foreign aid should start and stop to promote thriving societies.