Monday, May 11, 2009

Dead Aid: Why This Book Frightens Me, And Should Frighten You Too

A couple of days ago I came across someone called Annie Shaughnessy (one of my favourite surnames) on Twitter, and scanning her recent posts noted this gem, which in turn links to this article about two new books about aid dependency and corruption in Africa.

I call Annie's tweet a gem because the link she provided made me angry and excited and incredibly proud all at the same time, as well as a bit frightened for the future. It reminded me how the success of aid programmes in developing countries hangs on the whims of a select few people, and whoever happens to have their ears at the time.

If it is Dambisa Moyo who influences leaders, or anyone who shares her opinions (and they do - she's a former consultant to the World Bank), then I'd be very worried. In her book, Dead Aid, she seems to completely miss the point, labeling all aid as "bad", and private investment as "good". Or, at least, that's how any review (including the one in the article to which I've linked) is likely to summarise it.

Maybe she provides plenty of counter-examples and is rather more balanced than it originally appears (I'm considering buying a copy tomorrow so I can give a better summary later), but I'm not hopeful.

The problem I have with it is that the stated focus is entirely wrong. Rather than compare good approaches with bad, she chooses to arbitrarily lump a shedload of dissimilar programmes together, and tar them all with the same brush.

Judging from the first few pages, viewable on Amazon, it seems that the main target of her book is inter-governmental assistance, rather than non-governmental organisations (NGOs), but they don't come out of it unscathed either.

She accuses NGOs of wastefulness and of bending to the whims of donor organisations, citing the Bush administration's funding of abstinence-only HIV/Aids programmes. Yet again this is a bad example rather than indicative of NGOs as a whole.

It's also interesting to note that she picks an example of non-governmental organisations being dictated to by a governmental donor, so the corruption still lies primarily at a governmental level, rather than with the NGO. I'm certain that there are more appropriate examples that are purely non-governmental, so why doesn't she use them? Maybe that's a bit unfair and petty of me, but I do find it curious.

Yes, there is a lot of corruption, particularly at Government level, so maybe you shouldn't give to those Governments. You should say no to giving money that cannot be traced, and programmes that are not monitored. And you find another way of getting aid to where it's needed. But that's no justification for punishing honest politicians as well. Stopping aid to all Governments because of corruption in a few would be akin to deregistering every GP in the UK because of Harold Shipman.

In fact, I'm not a big fan of governmental aid, because even without corruption, it's too often wasteful and untargeted, by its very nature. Even within one country, different communities will have different needs, and nationwide statistics and programmes will not always reflect this.

This works similarly on the donor's side too - DFID, the UK Government's development arm, is slowly coming around to the idea that young people's sexual and reproductive health (SRH) conjures up a whole different set of issues and needs than the SRH of older adults, although in their latest HIV/Aids Strategy they're not yet promoting specific programmes and statistics to tackle this.

Another problem I would anticipate with the recipient Government (but which have no statistics on) is that the higher up in Government the money starts, the more admin costs will be eaten up on its way down.

So here is what I fear will happen with this book:

By promoting the idea that all aid to Africa breeds corruption and aid dependency, Dambisa Moyo will perpetuate the myth that the continent is some kind of basket case with no hope for a cure (so why bother trying to help them?), but this is patent bollocks.

The most telling thing about her, perhaps, is that she is a former consultant to the World Bank, the inter-governmental organisation that has a long and illustrious history of donating money to African governments in return for their opening up fragile economies to corporate rape. It is exactly this sort of action that has kept Africa in poverty and contributed to its image as a lost cause in the first place.

It is naive at best to argue that private enterprise can have anything but the general population's best interests at heart, something that has not only been demonstrated time and time again in developing countries, but has also hit rather closer to home in recent months in the form of the so-called "credit crunch". Market forces do not, as some economists insist on still arguing, find a natural balance for the good of everyone - they exist to make as much profit for those in control as possible.

When the IMF and World Bank forced the Tanzanian Government to privatise water supplies in the main city of Dar Es Salaam, it did not improve services for the people of the city, nor did it generate wealth for Tanzanian people.

A private company exists primarily to make profit, so it should come as no surprise that City Water (a company that is part British and German as well as Tanzanian) put up prices and made minimal investment into the infrastructure, which is exactly the opposite of the "reasons" Tanzania was given for handing over their infrastructure to the private sector.

Both the water and electricity supplies decreased in quality, while the frequency of periods of loss of service increased substantially. Quality of life for the ordinary national decreased, whilst the wealth of some British and German fatcats grew substantially.

The story with private enterprise in Africa is often the same. Money is generated to make the economy look good on paper, and then the money is removed from the country never to be seen again.

So why should this frighten you as well as me?

Why should it matter to you that someone thousands of miles away is getting the rough end of the deal?

Because someone else is suffering and we should care about our fellow man?

Or, failing that, because the people who are pushing this sort of agenda are our leaders too, maybe?

Hopefully, both of those reasons.

There's no point pretending that all aid is good and effective. I would even question some quite big and famous charities - some time ago I stopped donating to Oxfam because of the number of mailouts they send - they seem to me to be incredibly wasteful. But nor is there any point pretending it's all bad.

The fact is that there are countless examples of very successful NGO programmes, that are successful because they work directly with their communities and cater specifically to their needs.

One reason the Hoja Project is so successful is because it was the idea of a local villager, and it is the community who have largely shaped the programmes. However, without the donations raised in the UK, it couldn't have achieved anything like the success it's had. They certainly wouldn't have a vocational training centre to help people gain skills to earn a living.

Aid works (if it's done right).

And that's why the article also made me excited and proud (as well as angry and a bit frightened). Because I'm proud to know that Dambisa Moyo is wrong about us, and I'm excited that in one week I'll be on my way to Tanga ward for three months to work with Oswin and meet some of the people we've been lucky enough to help.

I can't wait.


  1. There's enough dogmatist economists in the world. You can find a hundred books on this theme.

    Check out Joseph Stiglitz for a rational economist with the ears of world leaders - and to restore your faith in mankind's future O_o

  2. Hello! I thought you might like to know that I've interviewed Dambisa and one of her critics: a young African student attending college in Canada. You can hear it HERE:

  3. Thanks for that Dave. I'll have a look later. :-)


Hello. Feel free to leave your comments and related links here. (Be nice.)