Altruism and foreign aid: all that glitters is not gold

Emily Wymer 24 April 2013

In a time of public spending cuts and austerity measures, the UK government will this year be the first of the G8 countries to meet a decades-old international target of spending 0.7 percent of its gross national income on foreign aid. The protection of the £11.5 billion aid budget is great news for NGOs, but has been attacked by Tory backbenchers in a time of military and security spending cuts. Some have branded this as international posturing; others think that the move is intended to give the image of the Conservative party a softer or more benevolent edge, while others have simply focused on the virtue of giving to those who have less. After all, 2.4 billion people still live on less than $2 a day worldwide.

The debate over budget cuts aside, the general perception of foreign aid is that it is a good thing. Western developed countries are portrayed as generous and benevolent givers of opportunity for a better life.Stopping far short of saying that it should be scrapped altogether, it is possible to argue that aid is not motivated by the pure altruism that many perhaps like to imagine.In fact, there is a lot more to the architecture of foreign aid than first meets the eye.Arguments that aid can be misplaced or inefficient, and that it fuels corruption and unfair allocation of funds are pervasive and persistent, while there are real issues of transparency. Structural Adjustment Plans by the IMF in the 1980s, which imposed dramatic neoliberal economic reform in exchange for debt reduction, saw an 18 percent decrease in GDP per capita in the period 1985-7, and are now widely acknowledged to be poorly judged. The number and complexity of conditions from multilateral donors such as the IMF and World Bank have since increased, and over half of official aid from donor governments is tied. Aid is not therefore a selfless donation, but rather acts to pursue the economic and political interests of the donor country.

Interestingly, Official Development Assistance from OECD nations may be becoming increasingly insignificant in the wider scheme of things. Recent studies have shown that flows of remittances from people working in the developed world and sending money back home now exceed that of official aid, and furthermore, that it is more effective.Adams Bodomo, a Hong Kong- based Ghanaian academic was quoted by the BBC last week as arguing that ‘family aid’ is more efficient: “An African family member abroad knows what is needed, whether it’s for school fees, to build a structure or to grow a business.”

Moreover, what of the ever-increasing flows from emerging sources such as China, India, Brazil or Saudi Arabia, so called South-South transfer? These are estimated to reach 20 percent of all global aid flows by 2015 – certainly not an amount to be sneezed at, and certainly not what we associate with the notion of traditional aid. These flows are characteristically distinct from flows from the West; it is generally untied, for example, and free of conditionality (although not without elements of economic reciprocity). Dr Emma Mawdsley, a senior lecturer at the Department of Geography here at Cambridge, whose research is focused on the rising powers and the changing politics of development, told The Cambridge Student: “The emerging powers are making real contributions in all sorts of ways, but there are also real and legitimate concerns about what they’re doing. It’s never a straight forward question of good or bad.” It’s possible that these shifting dynamics of aid could liberate developing countries from the conditionalities of the West, giving them greater agency and independence. Or perhaps that it naive; perhaps these new flows of aid are just as politically and economically motivated as ‘traditional’ flows, and all it represents is a re-distribution of global power and influence.

Aid is not dead, nor is it entirely ineffective and dying. But it could perhaps do with a re-boot; a re- conceptualisation, if you will. In a changing and globalising world in which patters of power are shifting, the economy is a political object, replete with ulterior political motives no matter which stakeholder you consider. If we recognise the politics inherent in our choices, we have a better chance of directing those choices in a way that is beneficial. There is no harm whatsoever in upholding a moral obligation to help those less fortunate, but to ignore the political and economic motivations, and the benefits for us as donors, would be to view the world through rose-tinted spectacles.

Emily Wymer