Peter Hoskin

The requirement to rethink aid

Following my earlier post, on how Brown will contribute British funds to a World Bank fund for poorer countries, I just thought I’d recommend this excellent interview with Dambisa Moyo and Richard Dowden in the latest issue of Standpoint.  Fraser’s already commented on Moyo’s book Dead Aid (here, and The Spectator’s review here) but a good thesis is worth repeating.  So here’s her take on the failure of “government-to-government flows or multilateral-to-government flows” to improve conditions in Africa:

“…if you are a government and you have as much money as you would like to maintain the military, then you don’t actually worry about being kicked out of office because the military is on your side all the time. Essentially, that is what has happened across Africa over the past 50 or 60 years. I can give you many examples of how aid comes in and supports a massive bureaucracy to work in the civil service…

…There are layers and layers of bureaucracy, which kills off entrepreneurship, leaves people out of jobs and when a government turns around and says there are people out of work, there are no jobs and people are poor, what is the first thing that the West decides to do? Oh, we’d better give people more aid. The aid system has got people locked into this cycle, where everybody sits back and thinks there is no need to try and raise taxes because we are going to get foreign aid. Or there is no need for anybody to be entrepreneurial because there is going to be more aid. The crux of the matter is that there are no countries on earth that are growing by 10 per cent a year, as China and India have been doing for the past few years before this whole crisis, that have relied on aid.

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