BY GETACHEW MINAS
Foreign aid is expressed in different ways such as humanitarian aid or development aid. There is not actual consensus on their true meaning and application. Both the donors and recipients have their ways of interpreting aid, depending on its timing and place of origin and destination. Recipients take it as a temporary phenomenon that occurs anywhere anytime due to unexpected natural occurrence such as drought or war that impedes proper human performance.
There is neither a donor nor a recipient on a permanent basis. Ethiopia, for example, had donated in kind and/or in cash to the Allied Forces affected by WWII. It had also successfully participated in the UN forces during the Korean War (1950s) and the Congo Crises (1960s), the latter mission had been commanded by an Ethiopian Army General. Thus, today’s recipient may be tomorrow’s donor and vice versa. Aid is given in kind, soul and spirit, including soldiers in arms for the defense of peace, law and order.
Foreign aid may take the form of money, equipment, or training given by either a country or a multilateral organization such as the UN to another country. There are bilateral and multilateral assistance at a global level, the former being given by one country to another, while the latter one is provided by UN, EU or USAID, etc. Aid may be given in the form of food or arms. The latter one is military aid which is “rarely” classified as foreign aid.
The origins of development aid began decades ago when Superpowers could provide their former colonies with military equipment, supplies, and training. Such assistance is an extension of colonialism or it is neocolonialism. Its goal is to keep newly independent countries still dependent on aid that prevents self-reliance. The provision of military equipment keeps developing countries at war with each other instead of focusing on economic and social development.
Industrial supplies originate from former colonial power with the objective of keeping poor countries dependent on them. They may be allowed to engage in the production of a few consumer goods. If they aspire for the creation of productive technology at the local level, they trespass the line for which they will pay dearly. Their duty is not to produce but consume imports for which they pay dearly in foreign exchange.
They earn foreign exchange by exporting traditional export items to the developed countries. In Ethiopia, accessing foreign exchange is very expensive. The rate of exchange is always on the rise, but at about half the rate in the black market. Foreign currency dealers believe that it is easy to control such a market unless there is a vested interest group functioning hidden within the government. The former governments have been successful in controlling such a market by sheer force and professional skills.
In addition to military equipments and consumer supplies, the Superpowers provided the developing countries with training of their human resources. These resources could be identified by sex, age, ethnic or tribal identities. These identities are used for dividing the people by their natural characteristics for which they are not responsible for having it. It is only a natural ascription or attribution inherited by birth.
An Ethiopian, for example, could not be a criminal for having such ethnic associations. The Western criterion for selection of individual Ethiopian for a training program, however, is very defective and divisive. Of course, the donor is not to blame as long as such criterion is welcome by the authorities at all levels. Foreign aid for capacity building is a poison covered with honey. What is more offensive is that highly trained and qualified Ethiopians are recruited to serve the Western institutions with high pay.
The foreign aid extended to Ethiopia takes different terms by different donors. Some refer to it as development assistance, while others call it aid. Experts of foreign aid do not go into detail about the exact definition of foreign aid. There are, however, debates on the positive and negative aspects of foreign aid. The term foreign aid may refer to supplies of money, equipment, and services given by one donor, a country or an organization to a developing country.
The critical factor of supplying aid is its relevance and timing. The relevance of assistance provided by donors to the developing countries is of the essence. Where starving people needed food, sending arms is an additional disaster by itself. Donors should not send whatever unused and excess material they have to the needy. They should conduct some kind of “need assessment” that makes aid relevant to the needy. Relevance is critical for both the needy and the donor.
In assessing the value of foreign assistance, it is absolutely essential to identify the pros and cons of aid. The pros or “advantages” of foreign aid are: (1) it helps meet Sustainable Development Goals (SDGs) Targets. In the year 2000, the UN developed a 15-year plan with the goal of tackling “extreme poverty” at a global level. It highlights the benefits of foreign aid to developing countries. The targets outlined in the plan were named the Millennium Development Goals (MDGs). While much impressive progress has been made by some countries towards these MDG, other countries have not achieved as expected. The “new” SDGs have replaced the MDGs as part of a new 15-year plan (2015–2030).
Much of the foreign aid given to countries today is aimed at fulfilling these SDGs. (2) Trade for Aid: The second advantage is “trade for aid” which is also known as development aid given to countries to promote their economies. A country might have an abundance of natural resources but requires investment to bring its output to the market. Helping to modernize transport network could thus be “aid for trade”. (3) Increasing Independence: Helping to develop a network of basic education, better infrastructure, and productive people is a perquisite to economic development and growth.
Associated with a booming economy and better access to global markets, the development aid can help countries become more independent. (4) Humanitarian aid: Most developed countries are democratic, with citizens demanding their governments to end endemic poverty in the developing countries. They also demand that these countries be free from disease, illiteracy, gender gaps in education and work opportunities.
When the citizens are informed of refugees, malnourished children and the devastation caused by climate change, they demand their government to deliver foreign aid to help poor countries. (5) Eradicate Disease: Communicable diseases like polio, cholera, malaria, and measles continue to affect millions of people in the developing countries. Beyond the immediate humanitarian aid and prevention of crippling injuries, controlling and eradicating diseases helps prevent their global spread. Other diseases being combated by foreign aid include Ebola that was brought under control with huge foreign aid.
The “disadvantages” of foreign aid to developing countries are briefly presented here: (1) Neglecting domestic needs is observed in these countries. Experts of foreign aid feel that large amount of aid should not be given to foreign countries until major problems such as homelessness, poverty, and inadequate health care are addressed at the domestic level. (2) Foreign aid is wasted: It is true that some portion of foreign aid is abused. It is drained off by corrupt local officials, but this has become less of an issue in recent years as all major donors have developed ways of “working directly” with the intended recipients of aid.
However, some foreign aid is misused, lost, or wasted due to a “combination” of incompetence and corruption on the part of local officials. In Ethiopia, corruption has become a crucial issue to be dealt with by the government. Another issue is “duplication of effort” by different donor agencies working in the same projects in the same area of a country. (3) Foreign aid is just colonialism in disguise: Several foreign aid supervisors believe that some of the biggest donors concentrate their foreign aid on their former colonies to perpetrate neocolonial relationships.
Experts reveal that it is easy to detect a donor country giving foreign aid with one hand and then demanding business favors with the other. It also supplies arms at exorbitant prices to the former colonies. (4) Giving foreign aid makes countries dependent instead of independent. Multilateral organizations closely manage per capita aid or the amount of foreign aid per person in a country. This helps donors to monitor how dependent a given country is on the receipt of foreign aid.
However, many countries in Africa, including Ethiopia, are heavily “dependent” on funds coming from abroad, including remittance. (5) Foreign aid promotes favoritism: It is proven that no donor country or organization offers help to every country. Some countries, therefore, get help at the expense of others. This kind of favoritism means that some countries do not get the aid they need while others get more; and there is little that the recipient nation can do to change things.
Abuse in international assistance program is known as wasted foreign aid or diversion of aid. In this situation, the effectiveness of foreign aid and international grants and assistance program is hindered by corruption and mismanagement. Abuses include fraudulent accounting procedures to cover poor management. Corrupt program managers employ accountants who accept unethical orders for hiding pilfered and embezzled funds planned for program and project execution.
What is not achieved is presented as a success story with false data and financial statements. False field visit reports are prepared in several copies to be delivered to authorities who are least concerned about project performance. They also conceal misappropriation of funds for private gain. Inefficient and suspicious use of resources, goods and services may occur within government offices and donor international agencies.
Misuse of resources may occur among the recipient institutions. In these institutions, there may also be foreign experts assigned to assist in the design and implementation of projects. Usually, government agencies are responsible for the implementation of these projects. The foreign experts may be useful in checking misuse of resources provided by foreign aid agencies. If these experts are indifferent and/or incompetent in the management of essential services, they may not detect corruption.
Corrupt project managers may give priority to luxuries for the advantaged rather than necessities for the disadvantaged. This practice leads to the breaking down of distribution networks for goods and services. As a result, the goods and services may reach the country such as Ethiopia, where aid is required “but not” the people in need. The total amount of aid in grant form may be increasing but it creates long-term dependency.
Several aid donors, including the World Bank, froze or severely decreased financial support to some African countries because top government “officials and their relatives” were siphoning off millions of dollars. The corruption was also deterring private investment, which fell by huge amounts in the past several decades. Much of the aid to the developing countries was allegedly diverted into the hands of corrupt officials and intermediaries who sold it at a profit on the black market.
The web of corrupt officials in Ethiopia was organized across a country and allowed only token amounts of aid to reach the intended institution and poor people. Generally speaking, the broad problems of the country are corruption, irresponsibility, ineffectiveness, inadequacy, and unethical practices of officials in using foreign aid.
Editor’s Note: The views entertained in this article do not necessarily reflect the stance of The Ethiopian Herald
The Ethiopian Herald March 18/2023
