The Three Sides of Foreign Aid

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Wars continue and humanitarian crises are constant, begging the question, has foreign aid been effective? After World War II ended, countries began feeling a unique sense of empathy for each other. The most powerful nations in the world suffered destructive effects, so it only made sense to form alliances to help each other mitigate the risk of another war. As a result, influential countries integrated aid provision into their political agendas for the first time in history and proceeded with the creation of international institutions such as the United Nations.

Unfortunately, wars continued and further crises resulted from them. But, as the world reached the information era, the general population in influential countries became fully aware of these catastrophes, and governments were pressured into sharing their resources with others. Ever since, foreign aid has blossomed into becoming a pillar of modern international relations by granting developing countries with the possible means towards development. 

Aid, just like any other policy, is evaluated in terms of effectiveness, so the international community is pressured into measuring its universal accomplishment. This becomes a difficult task given that it is impossible to validate universal claims such as “aid encourages development” or “fosters innovation” because this is not homogeneous; aid comes in different shapes and sizes, ranging from emergency assistance to project-based aid, so it would be unreasonable to label it in a single category. 

There are countless projects that have improved countries’ economies and living standards, but it is not a verification of the continuous effectiveness of aid. While aid can show positive effects on growth, it depends on what it is used for, the efficiency of the investment, and the policy response to it. To fulfill these goals, each country and project needs to be studied on its own, and since each is uniquely complex, this requires individual scrutinization into the problem and its causes.

Let us consider specific situations. According to the OECD, the world’s largest foreign aid donor is the United States—who has led notable initiatives such as the President’s Emergency Plan for AIDS Relief (PEPFAR)—which has decreased global AIDS deaths by almost half and provided treatment for 11.5 million people. This is an impressive initiative that inspired new ones, such as the President’s Malaria Fund, whose efforts saved 7 million lives and decreased malaria mortality by 50 percent. In these cases, recipient countries relieved from said health emergencies were able to direct their resources towards other pressing issues, ultimately making a positive case for foreign aid.

Contrastingly, foreign aid interventions tainted by corruption have failed terribly. For example, the Chad-Cameroon oil pipeline to the Atlantic Ocean, a $4.2 billion project financed by The World Bank, carried an important condition: the money, under international supervision, should be spent on the development of Chad. After two years, President Idris Deby threatened oil companies with expelling them if they failed to agree that he would use the oil money towards his regime’s survival strategies. President Deby then proceeded to expel the largest oil companies in Chad, claiming that his government would control the reserves. On the other hand, donor countries and institutions can also use aid to force recipient countries into implementing socioeconomic and political guidelines they deem necessary, leading to a harmful case of dependency on foreign aid and a possible lack of autonomy. 

Policies are implemented based on predictions and judged upon their value. Despite attempts to measure aid effectiveness, like the indicators of progress stated in the Paris Declaration on Aid Effectiveness and the Accra Agenda for Action, the difficulties to determine multi-dimensional metrics to account for the success of a project persist. While it remains true that foreign aid initiatives need to be contemplated individually to answer our question, the introduction of a third possibility becomes evident: if the net effects of aid cannot be measured, perhaps it is time to shift our focus from whether aid is effective or not towards what strategies lead towards a better provision of aid. 

While some corrupt governments have misused funds, entire communities have received micro-loans for women. A donor country exploits their bilateral relations for profit, and a green energy plant is sustaining a small economy. Funds are used to finance a war, and thousands of children are now going to school. If we were to place all elements in a balance, results would remain inconclusive because statistics do not have the ability to account for the complexity of human experiences, at least, not yet.

Categorically, the efficiency of aid depends on how it will be distributed and whether this will occur properly. To discuss the effects of foreign aid, the first tool at hand is to conceive its idea as standardized, but the over-diversification of foreign aid has caused complications larger than its moral aim. Thus, aid needs to be perceived as a multifactorial concept of various dimensions, not as a single entity whose merits are black or white. 

If we were to consider failure as a deal-breaker, most well-intentioned efforts would never get a chance to be put into action. As such, aid should be treated as an effort to provide recipient countries with a helping hand and, if it fails, it can be taken in as a lesson, and if it works, then someone somewhere is better off than before. This human-like, subjective perspective is the standpoint that can guide us towards a fairer judgment of foreign aid. 

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