Why the world’s poorest countries don’t always get the foreign aid they need
Fourie, The Conversation, April 12, 2018
aid, or official development assistance, is controversial. The expectation is
that it should benefit the most vulnerable countries but this is not always the
A UN aid
agency distributes free mosquito nets in Ethiopia. EPA-EFE
only about 19.8% of
traditional aid went to the world’s least developed countries. This
from 23.7% in 2015 and a peak of 26.9% in 2010. African
countries such as Côte d’Ivoire, Democratic Republic of the Congo,
Ghana, Mozambique and Senegal are among those that now receive less aid than
they did in 2010.
bilateral aid to Africa continues to decline despite the fact that 34 of the
countries on the continent are classified as least developed countries – the
reason for the decline in development assistance to poor countries is the rise
in foreign aid peculiarities like the so-called “in-donor
refugee costs”. This refers to foreign aid meant for refugees that
donors spend in their own countries. International conventions allow provider
countries to use
development aid to support refugees during the first twelve months
of their stay.
2010 and 2016, as foreign aid to many poor countries decreased, in-donor
refugee costs rose from USD$3.3 billion to USD$15.4 billion. This is a USD$12.1
billion increase in six years. In contrast, aid that flowed to countries in
need increased marginally from
USD$103.4 to USD$113.4 billion between 2005 and 2016. That amounts
to a USD$10 billion increase over an 11-year period.
mismatch between need and actual aid distribution shouldn’t be surprising. Why?
Because countries typically allocate aid based on three
criteria, the first being self-interest. The others are need and
merit. Problems arise when decisions must be made on the weight of each
is particularly complex. Different providers have different
levels of self-interest. Furthermore, levels of self-interest differ
from administration to administration even within the
same provider countries. When it comes to non-state providers
different funders within the same country can also exhibit varying
interpretations of self-interest.
the most enduring illustrations of the connection between self-interest and aid
allocation can be seen in the voting
patterns at the United Nations General Assembly where the interests
of nation states outweigh need or merit. Nation states are more likely to give aid to
their trade partners over their non-trade partners. In addition,
researchers have found indications that providers are prone to allocate
disproportionate amounts of aid to recipients who have the same
allies and rivals.
self-interest has its issues, the merit and need criteria are also complex. Studies
have found that in some countries aid actually decreased as the policy
environment improved. Put differently, even as countries’ merit ratings improved
(better policy environments), they started receiving less aid. Conversely, in
some cases, perceived need trumps merit especially in instances of food aid.
This continues to be the case in countries like Ethiopia
and South Sudan
where oppressive governance systems and ethnic conflict have prevailed for
things considered, the most deserving and impoverished countries don’t often
get the most foreign aid. This much is clear and can be explained with
reference to the complexity of balancing self-interest, need and merit.
doesn’t answer some fundamental questions such as, what are the limits to
self-interest? Shouldn’t need and merit be more important than self-interest?
And finaly, should need, merit and self-interest be the only criteria?
Global Partnership for Effective Development Cooperation has provided some
direction in this regard by emphasising a fourth criterion: effectiveness.
Over the past few years I have had the opportunity to collaborate closely with
the Global Partnership, which represents the vast majority of the world’s
provider and recipient countries.
emphasising effectiveness, it prioritises
country ownership, accountability, transparency, results orientation, and
inclusive partnerships as the requirements for aid effectiveness. So far, aid
effectiveness is receiving wide support from both developed and developing
countries, including regional organisations like the African Union.
forward, metrics that quantify the effectiveness of aid will be very helpful
not only for understanding current aid distribution patterns, but also for influencing
future aid allocation.