The July 2nd-8th issue of The Economist has this as the headline as the world turns interest towards “making poverty history” in Africa. A few interesting quotes from the introductory article:
“Some [critics] say aid [to Africa] is useless. Some say it is worse than that. Economists worry that it crowds out export industries, by, for example, bidding up the price of skilled workers. And aid may make governments dependent on their paymasters in the rich world, not their taxpayers at home. For every extra dollar of aid they are given, governments raise 28 cents less in tax, says Sanjeev Gupta, of the IMF.”
“The claims for aid should not be inflated. Grand, global targets, such as the UN Millennium Development Goals, might helf the international bureaucracies fill their coffers and justify their existence. But they also invite disappointment and disillusionment when the goals are missed.”
“But neither should the demands be exaggerated. The sums (the Commission for Africa calls for an extra $25 billion a year over the next three to five years) amount to just 0.08% of the 22 richest donors’ combined GDP. And besides, what else would the money be spent on? The European Union alone wasted $55 billion last year on a common agricultural policy designed to keep food expensive for its consumers.”
“To benefit Afrcia the money need not even be spent in Africa itself. It is sometimes said that 90% of the $75 billion spent each year on medical research is devoted to the concerns of just 10% of the world’s population.”
“No one should be naive about aid. It cannot make poverty history, and it can do harm. But to say that nothing works is wrong. Cynicism is only the most common form of naivety.”
One thought on “Helping Africa to help itself”
No one says it quite like the Economist. I love their quote “The European Union alone wasted $55 billion last year on a common agricultural policy designed to keep food expensive for its consumers.” Building on their point about the best assistance not being in the form of aid: I sent Brian (may have copied you, don’t remember) a series of emails earlier in the year outlining some similar points. In those emails I make the case that Europe, due to its proximate location to Africa, is well positioned to help Africa by allowing more immigration from Africa. This could liberate millions of Africans from lousy, corrupt African governments/economies (not to mention the “expatriot remittances” from these emigres that would flow back to Africa and fund schools, hospitals, public works projects, etc…) But most Western European countries are growing far to slowly to support this kind of assistance. While the U.S. attracts millions and millions of poor Latin American immigrants (legal and otherwise) thanks to its roaring economy, Europe has largely missed this opportunity to assist the African poor, thanks to its stagnant and stagnating economies. Economists, even increasing numbers of European economists, attribute Europe’s stagnation to its overly regulated and overly taxed economies. Many of the European policies that are held up as progressive models of social welfare, are, un-intentionally, hurting the worlds poor….