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General Analysis on International Aid
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Articles and Documents
2008 | 2007 | 2006 | Archived Articles
The Development Agenda after the 2005 Millennium+5 Summit (November 2005)
This briefing paper analyzes the outcome document of the Millenniun+5 Summit, stressing the importance of financing for the Millennium Development Goals. At the Summit, governments set a timetable for increasing Official Development Assistance (ODA). This paper warns that governments may count debt relief as aid, to avoid directing more resources to poor countries. Regarding global taxes, due to opposition from the US and Japan, the document merely mentions “the value” of alternative financing such as aviation taxes. (Global Policy Forum and Friedrich Ebert Foundation)
Since 2001, the nominal amount of global development assistance has grown steadily, reaching its highest level ever in 2004. Yet the poorest people of the planet have benefited from the increase only to a limited extent. The amount of aid still lags far behind the UN target of 0.7 percent of rich countries’ gross national income, and donors continue their practices of using development assistance to support their geopolitical and economic goals. [pdf version] (Global Policy Forum)
2008
The Paris Declaration and Aid Effectiveness (June 10, 2008)
Many poorer countries argue that although the Paris Declaration includes indicators for evaluating aid effectiveness, it primarily reflects the interests of donor countries. The World Bank and donor countries set conditions for aid spending without consulting recipient countries. While, the declaration does not impose any penalties on donor countries who do not meet their obligations, recipient countries face consequences. The author recommends that an independent international body such as the UN Development Cooperation Forum should monitor the effectiveness of aid spending. (Pambazuka)2007
Aid for Sexual Health Declining (October 10, 2007)
NGOs and EU politicians are worried about the decline in development aid directed at sexual health and family planning. They insist that providing sexual health services is both a moral imperative and an important factor in reducing poverty. Every year more than 500,000 women die from complications during pregnancy and child birth. In addition to the immediate loss of lives, problems of poverty arise due to insufficient health care and excessive population growth. Increased funding could allow women to choose how many children they want to have and they could then find themselves in more favorable economic conditions. (Inter Press Service)New World Bank Chief Confronts Aid Shortfall (September 24, 2007)
Following the turmoil surrounding former World Bank chief Paul Wolfowitz and national budget problems, many rich countries have lowered their contributions to the Bank. Governments increasingly channel aid funds through their own development agencies, rather than through the International Development Association of the World Bank. World Bank chief Robert Zoellick maintains that the Bank is still an important financial institution and the only one that can “analyze overall needs, share information, set priorities and avoid duplications and contradictions in aid programs.” But many governments question the future relevance of the Bank. (International Herald Tribune)Chávez Pledging $8.8b in Global Aid (August 27, 2007)
Venezuela is using oil profits to fund development in Latin America and the Caribbean, superseding direct US aid in the region. Venezuela directs the funding to left-leaning countries in a effort to collectively gain increasing independence from the United States. “The scale of Venezuela's commitments is unprecedented for a Latin American country” and even though Venezuelan President Hugo Chávez rejects any kind of aid competition with the US, the battle for the hearts and minds in the region seems to have begun. (Associated Press)Is Western Aid Making a Difference in Africa? (August 23, 2007)
Tanzanian journalist Ayub Rioba argues that since gaining independence, Africa has received billions of dollars in aid, yet the number of poor Africans has doubled. Different schools of thought exist to explain this. The "governance first" group argues that African people, not outsiders, have a responsibility to improve the quality of their own governments. The "poverty first" group, represented by economist Jeffrey D. Sachs, believes that the solution to Africa's problems lies in tackling poverty by increasing the amount of aid. Finally, a third group argues that current aid flows are sufficient, but that donor countries must reform the way aid is distributed and administered. (Christian Science Monitor)'Aid for Trade' May Cut Health, Education Funds (July, 20 2007)
The European Commission has guaranteed to give “aid for trade” to African, Caribbean and Pacific nations who will sign the Economic Partnership Agreements in Brussels in 2007. These funds will help increase the countries’ trade, but some African diplomats have raised concerns. They claim that the EU has not said where the money comes from, meaning that this aid could come “at the expense of other forms of development assistance,” which are needed to subsidize projects in health and education. (Inter Press Service)China Launches $1B Africa Fund (June 26, 2007)
China has launched an African Development Fund of US$1 billion which will invest exclusively in Chinese enterprises and their projects in the continent. China has increased its aid and loans to Africa in exchange for access to oil and other resources and to secure new markets for its exports. Development advocates have criticized this policy of “tying aid" to purchasing goods and services from the donor country and accuse Beijing of supporting authoritarian regimes in Africa. (Associated Press)International Aid and Economy Still Failing Sub-Saharan Africa (June 11, 2007)
This Share the World’s Resources article analyzes a UN report on Africa and the Millennium Development Goals (MDG), which revealed that sub-Saharan Africa will probably not achieve any of the Millennium Development Goals by 2015. The author argues that some African regions have improved their education, healthcare and agricultural productivity but that poverty in not decreasing at the same rate as before. Moreover, evidence shows that neoliberal policies adopted by the IMF, World Bank and WTO have failed in tackling poverty.G8: The Aid Gap (June 5, 2007)
This openDemocracy article reports that far too little attention is given to the use and impact of international aid in Africa. The author highlights three key trends which directly affect the quality and distribution of aid and argues that these trends always benefit the most powerful while ignoring women’s needs and rights. The first trend relates to the fact that aid is usually given to multilateral aid organizations such as the EU, UN and World Bank and not directly to the people which would ensure greater equality. The second trend reports on the problems raised by giving aid to corrupted governments. Finally, the third trend relates to the fact that donors are getting stricter in the way that they fund NGOs.Making Relief Aid Count (May 28, 2007)
The Humanitarian Accountability Partnership (HAP) has developed a set of standards to measure the quality of international aid. These guidelines include an “unprecedented” complaint mechanism which allows aid recipients to voice their opinions. HAP hopes that donor governments and NGOs will adopt the standards as a way to consistently monitor the effectiveness of disaster and relief aid. (Integrated Regional Information Networks)The World Is Still Waiting (May 11, 2007)
This Oxfam report calls on the G8 countries to fulfill their promise of increasing international aid to US$50 billion per year by 2010. Based on current aid trends, the G8 risk missing this target by “a staggering US$30 billion” – an amount which Oxfam estimates has the potential to “save at least five million lives.” Despite their pledges to significantly increase international donations – especially to Africa – aid from G8 countries actually decreased in 2006 for the first time in almost a decade.Global Fund for AIDS, TB and Malaria Aims to Triple in Size (April 27, 2007)
In order to meet projected demand, the Global Fund for AIDS, TB and Malaria – which currently supports programs that save 3,000 lives per day – aims to triple in size by 2010. Arguing that increased funding will allow greater progress toward meeting the UN Millennium Development Goals, the Fund has called on both public and private donors to “dig deeper into their pockets” and to provide more “reliable and predictable finance.” (Agence France Presse)West’s Foot-Dragging Over Aid to Africa Called “Grotesque” (April 25, 2007)
The Africa Progress Panel (APP), established to monitor the 2005 Gleneagles Summit aid pledges, reports that the G8 countries are “only 10 percent of the way to their target” of doubling aid to Africa by 2010. The APP, headed by former UN Secretary General Kofi Annan, further warns that failure to meet these commitments would be a “grotesque abrogation of responsibility…and a threat to the lives of the world’s poor.” (Guardian)Development Aid from OECD Countries Fell 5.1% in 2006 (April 3, 2007)
In this review of official development assistance in 2006, the Organization for Economic Cooperation and Development (OECD) finds that the world’s 22 major donor countries have fallen far short of their pledges for increased aid and debt relief. Only five countries reached the United Nations’ recommended aid target of 0.7 percent of gross national income, and overall assistance fell by 5.1 percent. Furthermore, the OECD expects foreign aid to continue to decrease in 2007 as US debt relief to Iraq and Nigeria declines.G8 Development Ministers Seek Ways to Meet African Aid Goals (March 26, 2007)
Despite renewed promises to double aid to Africa and to meet the UN Millennium Development Goals by 2015, a meeting of the G8 development ministers is unlikely to produce any concrete policy changes, reports this Deutsche Welle article. Although some of the ministers claim that the G8 members have made substantial progress toward “democratization, social reforms and economic growth” in developing countries, experts argue that more aid money and increased cooperation between North and South are necessary to reach those goals.War Zone Aid “Fuels More Conflicts” (January 14, 2007)
A study by the non-governmental organization Tiri found that international aid to postwar regions frequently causes further violence and instability. The loss of up to half of development aid to corruption fuels “dangerous public resentment.” Donor governments add to that resentment by distributing aid to suit their own priorities rather than those of recipient countries. Arguing that the current aid industry fails to promote reconstruction and instead “directly leads to new conflict,” the Tiri report makes no specific reform recommendations beyond calling for more effective distribution of aid. (Observer)Assistance for Africa: "Don't Turn Your Back on My Country" (January 3, 2007)
At the 2005 Gleneagles summit, the G8 pledged to double aid to Africa by 2010. A year later, however, African nations such as Liberia, “one of the poorest places on the face of the earth,” are facing diminishing international aid flows. Liberia had failed to meet the condition of “good governance” at the time of the Gleneagles summit, and therefore did not qualify for debt cancellation. President Ellen Johnson-Sirleaf fears the aid shortage will further destabilize the already volatile country as it struggles to recover from civil war. (Independent)2006
Disaster Funds “Unfairly Divided” (December 14, 2006)
With US$17 billion, governments and private individuals gave the largest amount of emergency aid ever in 2005. Yet, the disproportionate media focus on major crises has resulted in a very uneven distribution of funds among the world’s crises, says the ‘World Disasters Report 2006.’ The large number of small crises kill and affect much more people than a few major events. But while for instance donors only gave 40 percent of the funds pledged for emergencies in the Democratic Republic of Congo, Djibouti and the Central African Republic, the Indian Ocean tsunami received 475 percent funding. (BBC)ACP Calls for More Development Aid from EU (December 10, 2006)
Under World Trade Organization rules, the European Union’s preferential trade agreements with 79 countries of the Africa, Caribbean and Pacific (ACP) group are “no longer legal.” Gathering in Khartoum for its heads of state summit in December 2006, the ACP group discussed the January 2008 replacement of the preferential EU-ACP trade agreements with EPAs (Economic Partnership Agreements), where parties have to open their markets reciprocally. The summit issued a statement calling for more EU aid to compensate for lost tariff revenues and finance investments in infrastructure to prepare domestic industries for increased competition. (Agencia de Informacao de Mocambique)Press Release: Humanitarian Agencies Appeal for $3.9 Billion in Aid for 2007 (November 30, 2006)
UN Secretary General Kofi Annan has launched the Humanitarian Appeal 2007. Some 140 NGOs and UN agencies seek US$3.9 billion for humanitarian work to help 27 million people in 29 countries, including Sudan, Somalia and the occupied Palestinian territory. The 2006 appeal received 63 % of requested funding, which makes it the best year to date in terms of funding, excluding years that had “headline crises” like the Indian Ocean tsunami. (ReliefWeb)EU Gathers Leaders to Push Conditional Aid Deals for Africa (November 16, 2006)
Hosting a conference on European aid to Africa in November 2006, the EU aimed to prevent loss of influence on the continent after “recent Chinese overtures of trade and aid to Africa,” says the Associated Press. Against Chinese lack of concern for human rights and sound governance in dealings with African countries, the EU confirmed its conviction that tying aid to political and economic reforms “is the best way of improving the lives of Africans.” The EU pledged to increase in annual aid to Africa from 17 to 25 billion euros by 2010. Meanwhile NGOs argued that the policy of conditionality “has never worked,” and criticized the EU lack of attention to businesses’ role in African corruption.Not Wanted: Rich, African Nations (November 10, 2006)
Despite the general focus on Africa’s failings, the region also has many success stories, argues this afrol News article. Cape Verde, Botswana and Seychelles amongst others have achieved a level of development moving them out of the category of Least Developed Countries. These countries now feel “penalized for progress,” as donors disengage while investors are still not convinced, bringing “new hardships” to governments trying to move their nations from a middle-income level “to a wealthy state of general welfare.” While the UN does not consider assistance to middle-income countries to be development aid, there is a well documented opposite practice of “rewarding” countries whose failed policies has made them slide down the development index, says the article.China to Double Aid to Africa (November 4, 2006)
Speaking at the November 2006 China-Africa summit, Chinese President Hu Jintao, pledged a US$5 billion increase in loans and credits to Africa over the next three years, thereby doubling Chinese aid to the continent. The summit also produced several natural resource investment deals between Chinese companies and African countries, thus further boosting recent years’ enormous increase in China-African trade, which consists primarily of oil, minerals and other natural resources along with Chinese-made weapons. Meanwhile, critics say China “extracts what it needs from the continent, while ignoring environmental and anti-corruption standards.” (Integrated Regional Information Networks)US Jobs Shape Condoms’ Role in Foreign Aid (October 29, 2006)
The US Agency for International Development (USAID) could afford many more condoms if it bought them from the lowest bidders on the world market, reports the New York Times. But consistent lobbying by Alabama politicians ensures that the majority of condoms the US provides to poor countries come from Alabama factories. Thus, while many in the US base their skepticism about foreign aid on doubts of its effectiveness, concerns for US jobs and commercial interests substantially reduce the reach of USAID money. Reporting that average production costs for one condom stands at five cents in Alabama but only two cents in Asia, the article does not, however, consider if poorer working conditions in Asia might account for some of the divergence.Drought in Africa: Ethiopia’s Bitter Harvest (October 24, 2006)
In fall 2006, the worst drought in a decade claimed the lives of five men in the 13 family Ethiopian village of Magado. Food aid prevented hunger-related deaths, but after watching 99 percent of their cattle die and their livelihoods destroyed, the men hanged themselves out of shame and despair. Despite early alarms of the coming drought, emergency aid only arrived “long after the cattle were beyond salvation.” According to Care International, the aid system regrettably tends to respond only “when an emergency is at its height,” disproportionately treating the symptoms of emergency hunger, rather than preventing its causes with a quicker response. (Independent)Madonna the Latest Pop Star to Shine Celebrity on Africa (October 12, 2006)
Funding and visiting AIDS orphans projects in Malawi, pop icon Madonna joins the growing list of celebrities putting resources into Africa. Christian Science Monitor reports that most aid agencies welcome the arrival of celebrities in the world of humanitarian aid, appreciating the press attention that “these A-listers” can draw to development in Africa. Other analysts, however, fear that too many donors preoccupy themselves with projects that make them “look good,” rather than promote long term development.UK 'Threat' to World Bank Brings a Little Cheer (September 15, 2006)
The British Department for International Development (DFID) will withhold £50 (US $95) million from the World Bank unless it stops demanding that poor countries privatize public services and liberalize trade as conditions for aid and loans. British NGOs would prefer DFID withhold all money to the Bank, rather than just a tiny fraction of the £1,3 (US $2,4) billion pledged over the next three years. But the NGOs welcome the move as a “partial victory” for their advocacy to have the British government put pressure on the World Bank to change its policy. (Inter Press Service)Managing Globalization: Bad News Traveling Faster, But So Is Aid (August 22, 2006)
As technological developments allow news to travel faster, aid groups can better alert potential donors. Furthermore, international aid agencies have begun to solicit donations from individuals and groups on a global scale, rather than just in the wealthiest countries. However, although widespread coverage may benefit aid collections, it may also endanger aid workers who wish to remain inconspicuous in conflict-ridden zones. (International Herald Tribune)Netherlands Leads World in “Quality” Aid (August 13, 2006)
The Netherlands followed by the three Scandinavian countries gives the highest quality aid to poor countries. Japan gives the lowest and the US ranks 16 among the 21 evaluated nations. Aiming to encourage more development friendly policies, the “Commitment to Development Index” assesses donors’ policies towards poor countries. The index looks at the percentage of “tied” aid, domestic market openness to poor country goods and environmental considerations in aid policies. Foreign Policy magazine finds a clear positive correlation between the quality of a country’s democracy and its aid. (Inter Press Service)Real Aid II: Making Technical Assistance Work (July 5, 2006)
This second Real Aid report by ActionAid examines the composition and character of aid, and finds that roughly half of all international aid is “phantom aid” – aid that poor countries do not have genuinely available for poverty reduction. Focusing specifically on the often ineffective “technical assistance” using donor countries own expensive consultants and companies, the report makes recommendations for turning aid into effective “real aid.”Joint Evaluation of the International Response to the Indian Ocean Tsunami: Executive Summary (July 2006)
This Tsunami Evaluation Coalition (TEC) report examines how international aid had a long-term impact on the areas affected by the 2004 Tsunami. TEC cautions that despite significant accomplishments, agencies and governments involved in relief and recovery could have channeled aid more efficiently. The report recommends that emergency relief services devote more attention to donor and recipient priorities, coordinate with other agencies and work more closely with affected people.Controlling Carrots and Sticks: White House Tries to Rein In Foreign-Aid Agency It Recently Created (June 30, 2006)
In 2002, the US Congress created the Millennium Challenge Corporation (MCC), an aid distributing agency designed to act independently of the State Department. In theory the MCC allocates aid to countries if they meet 16 requirements ranging from corruption control to health standards, rather than providing aid because of political considerations. While conservative critics claim the MCC undermines State Department foreign policy, others point out that with Secretary of State Condoleezza Rice sitting on its board, the MCC cannot resist the political pressure. (Wall Street Journal)Geldof Says Richest Countries' Pledge to End Poverty in Africa Still Not Honored (June 30, 2006)
Bob Geldof, organizer of Live Aid (1985) and Live 8 (2005), laments that rich countries determine the fate of poor countries. The article shows the results from campaign group Debt, Aid, Trade, Africa (DATA), which reviewed the 2005 statistics on donations from the G7 to find that only France fulfilled promises for aid. Other G7 countries, notably Germany and Italy, must drastically increase aid in order to meet the goals set for 2010. (Independent)Foreign Aid Has Flaws. So What? (June 13, 2006)
New York Times columnist Nicholas Kristof comments on those who critique international aid as ineffective. Aid can cause rising exchange rates, dependency, and undermine local institutions. However, Kristof points out that in spite of these negative consequences, organizations and governments rely on international aid to improve health conditions and save lives. Rather than using the complexity of international aid as an excuse to throw their hands up into the air, North Americans should renew their efforts to contribute.The View from the Summit- Gleneagles G8 One Year on (June 9, 2006)
Oxfam International reports that although the G8 aid and debt relief initiative allows poor countries to spend more money on healthcare and education, the G8 countries are falling short on their promises. The G8 countries count debt relief as aid, making aid statistics look higher than they really are. International donor countries must increase their aid in the years to come if they plan on meeting the pledge of $50 billion made at the Gleneagles summit.What’s Next in International Development? Perspectives from the 20% Club and the 0.2% Club (June 2006)
This Overseas Development Institute report sheds light on the multiplicity of interests among aid recipient countries and suggests that aid agencies should adapt to these variations. While countries where aid constitutes 20% of GDP look at absorptive capacity, political development, and use of aid to achieve growth and human development, those that receive 0.2% of GDP from aid show more concern with non-aid development issues like security and global commons. These differing priorities challenge the notion of a universal development aid strategy.Money Can’t Buy You Love (May 22, 2006)
Eurodad looks at the Evaluation of General Budget Support published by the Development Assistance Committee (DAC) of the Organisation for Economic Co-operation and Development (OECD). By giving money directly to poor countries’ governments instead of financing their own development projects, rich countries could enable aid to better reduce poverty. Nevertheless, a lot of questions, such as how to monitor the aid spending by poor countries, remain unanswered.Least Developed Countries Report 2006 (May 17, 2006)
UNCTAD finds that higher rates of economic growth in many least developed countries (LDCs) have not translated into improved human well-being. The comprehensive 2006 Least Developed Countries Report suggests that LDCs must increase their very low labor productivity to achieve sustained growth and poverty reduction. As 2000-2010 will be the first decade in the LDCs where the economically active population outside agriculture will grow faster than that within, the LDCs must develop competitive businesses in manufacturing and services, says the report. It identifies challenges that LDCs will face in this effort, among them improving physical infrastructure. UNCTAD finds that donors must reallocate aid to address these challenges.UN Disaster Relief Fund Makes First Donations for Under-Resourced Emergencies (May 10, 2006)
The Central Emergency Response Fund (CERF), launched by the United Nations to respond quickly to humanitarian crises, redistributes a third of its money to chronically under-funded emergencies. Five months after its creation, CERF for the first time provided such funding to 11 African countries and Haiti. Of the targeted US$450 million, governments have only pledged US$254 millions to the Fund. Worse still, out of those pledged funds, donor countries have only come through on US$159 million. (UN News)Aid Harmonization: Challenges for Civil Society (May 2006)
This newsletter from the International NGO Training and Research Centre (INTRAC) looks at how the Paris Declaration on Aid Effectiveness affects NGOs as providers of international aid. The declaration urges governments to transfer aid directly into the budgets of poor countries, rather than funding their own development projects. While this could prevent rich countries from using aid as a tool to achieve their own political and economic interests, INTRAC warns that Northern NGOs could lose much of their funding and political influence. Southern NGOs, although benefiting from poor countries’ increased aid budget, could lose their political independence since national governments would fully decide which NGOs to fund.USAID Reform: Diplomacy, Defence, Democracy - and Development? (April/May 2006)
Although NGOs have long called for reforms of the US Agency for International Development (USAID), the changes introduced by the Bush administration will probably harm the world's poorest. The agency’s new leader, Randall Tobias, now reports directly to the Secretary of State, making US aid policies even more vulnerable to “short-term political or military objectives.” Among rich countries, US aid ranks second lowest as a proportion of economic output. Furthermore, 77% of this assistance goes to US suppliers and services instead of poor countries’ development initiatives. (World Economy & Development in brief)Counting Aid Dollars (April 16, 2006)
A study released by Washington’s conservative Hudson Institute increases the appearance of US generosity by adding certain private flows to the official aid figures. 75% of this additional "aid" is contributed not by private foundations or NGOs, but by immigrants sending remittances to their families. Instead of considering these remittances, which clearly cannot count as foreign aid or charity, NGOs should call attention to the fact that the US remains one of the most “stingy” countries in the world. (Washington Post)Economist Pushes Insurance as Answer to Disasters (April 11, 2006)
According to Jeffrey Sachs, insurance covering natural disasters could give poor countries the chance to act immediately in case of emergency. The economist and UN advisor hopes the concept could also enable poor countries to gain independence from unpredictable and slowly deployed international aid. In March 2006, French AXA was the first company to issue insurance for an entire country, when agreeing to cover Ethiopia in case of droughts. (AlertNet)EU Aid: Genuine Leadership or Misleading Figures? (April 2006)
EU governments inflate their aid figures by including items such as export credit debt relief or language courses for foreign students. Some of Europe’s biggest contributors in total terms (i.e. Germany, France, and UK) spend more than one third of their “aid” on items not perceived as development assistance by public opinion. Furthermore, this inflation contravenes the UN Monterrey agreement on development finance. This NGO report presents figures for each EU country as well as the EU as a whole, illustrating malpractices and pointing at Europe’s “black sheep.”The Man without a Plan (March/April 2006)
Harvard professor and Nobel laureate Amartya Sen looks at New York University professor William Easterly’s book “The White Man’s Burden: Why the West’s Efforts to Aid the Rest Have Done so Much Ill and So Little Good.” While agreeing with Easterly’s critique that too few organizations steer the international aid system, Sen argues that Easterly fails to explain how to reform this system of “good intentions but often harmful impact.” In supporting aid driven by a supply and demand rationality, the book disregards the effects of malfunctioning markets in many poor countries. (Foreign Affairs)Aid that Works? Multi-Donor Budgetary Support in Ghana (March 29, 2006)
Based on a report by the World Institute for Development Economics Research (WIDER), this article looks at the efforts of various donor countries to provide more independent and predictable aid to Ghana. As aid programs conducted directly by rich countries firms “have had limited success” in reducing poverty, the Multi-Donor Budgetary Support (MDBS) approach directly funds development programs chosen by the Ghanaian government. Although major donors such as Japan still refuse to participate, the initiative could help untie aid flows from rich countries’ commercial interests. (ID21)Aid Inflows, Debt Relief Yet to Translate into Reduced Poverty (March 20, 2006)
Uganda, as many other sub-Saharan African countries, has achieved increased economic growth accompanied by moderate inflation rates. However, this “macroeconomic stability” has failed to improve the living conditions of the country’s poor. At a meeting organized by the International Monetary Fund (IMF), Ugandan government officials pointed out that, although the country receives more aid flows “on paper” they have little impact “on the ground.” (New Vision)Bush's Fake Aid (March 10, 2006)
Four years after announcing an increase in US development aid to $5 billion, the Millennium Challenge Corporation (MCC) has proved itself incapable of helping the world’s poor. Since its creation the MCC excluded experienced aid organizations and experts from its activities and promoted a neoliberal approach to development. In addition, the US government provided less than half of the funds it initially pledged to the organization. (Rolling Stone)World’s First Humanitarian Insurance Policy Issued (March 6, 2006)
A small group of donor countries, including the US, contracted the private insurance company AXA to cover the risk of droughts in Ethiopia. In this pilot project developed by the World Food Programme (WFP) and the World Bank, an annual amount of US$930,000 would lead to immediate payments of US$7 million if rainfalls drop “significantly below historic averages.” However, neither the WFP nor AXA provide details regarding the deal. Furthermore, opening humanitarian aid activities to corporate interests is a “risky business.”World Warned It Must Do Better as 20m Face Threat of Famine in Africa (March 8, 2006)
Executive Director of the World Food Programme (WFP) James Morris describes the humanitarian situation on the Horn of Africa as the worst in his experience. The WPF needs urgent donations to avoid major food crises in Kenya, Somalia, Eritrea, Ethiopia and Tanzania. The article asks governments to give more money directly to multilateral aid institutions that buy food locally instead of providing bilateral government support or food exports. According to the Guardian, US$5.2 billion would be enough to allow the WFP to eliminate hunger for children in the whole of Africa.Global Emergency Fund – Major Donors Missing in Action (March 2, 2006)
The United Nations Central Emergency Response Fund (CERF), which officially begins its operations on March 9, 2006, continues to fall short on funding. Countries like the US, Japan and Italy have so far not pledged any money to the fund. The CERF would allow the UN to respond rapidly to natural catastrophes as well as humanitarian crises around the globe. The more independent structure of the fund would particularly benefit crises with little media or political attention. (Oxfam)Aid for Trade (March 2006)
With this report, Nobel laureate Joseph Stiglitz and Andrew Charlton draw attention to the importance of strengthening poor countries’ export capacities. A new multilateral platform, operating within UNCTAD, could overlook investments in infrastructure projects, assist local export businesses and provide advice on national trade policies. With the poorest countries’ interests well represented in the organ’s governing body and rich countries providing the necessary funds, the proposal is an important step to a more equal trade system. (Commonwealth Secretariat)New Fund Promises Enhanced Aid Response (February 14, 2006)
The United Nations Central Emergency Response Fund (CERF) represents a new approach to humanitarian crises. It enables the emergency relief coordinator, responsible for the allocation of all aid, to take immediate action without the need to confirm available funding with donor governments. However, rich governments have only pledged US$185 million of a targeted US$500 million so far. (Integrated Regional Information Networks)Aid Instruments in Fragile States: Making the Right Choices (February 8, 2006)
In countries where the government fails to provide basic services for its people, donor countries have to channel aid more carefully to prevent recipient governments from mismanaging the funds. Based on a report published by the UK Department for International Development in 2005, this id21 article encourages donors to evaluate countries’ willingness and capacity to spend the money on programs helping the poor. The report also argues that donors should involve NGOs, UN agencies and local experts, to make aid assistance more effective.Wrong Fix for Foreign Aid (February 6, 2006)
The New York Times reports on Secretary of State Condoleezza Rice's proposal to reform the US foreign aid system and how it will negatively affect US development assistance. Once implemented, the US will give a larger portion of aid to promote its economic, political and military interests. Already this type of aid accounts for more than 50% of the country’s aid budget. The article asks the US Congress to pass a law that ensures a fair part of the aid actually goes to real antipoverty efforts.More Needs to Be Done Beyond Giving Developing Countries Aid (January 21, 2006)
In many poor countries, aid fails to reduce poverty and protect basic rights. Often aid consists of questionable technical assistance or vouchers to buy goods or services from donor countries. This article argues that rich countries should increase the quality of their aid by donating money directly to specific government funds, for example to the Ministries of Education budgets. (AfricaFiles)Needs of Poor, Not Politics, Should Drive Reform of US Foreign Aid (January 19, 2006)
Oxfam argues that the overhaul of the US Agency for International Development (USAID) provides an opportunity to improve the quality and quantity of US development aid. Building strong local and political independent institutions should be a “cornerstone” of the USAID strategy. Also, the NGO points out that rich countries must make trade concessions to poor countries to make globalization inclusive and erase poverty.Africa: “2006 Must Be Year of Action” (January 10, 2006)
This article supports top UN adviser Jeffrey Sachs’ urgent call on all governments to fulfill their aid promises made in the seventies. Sachs points out that there are promising practical solutions to lift the poorest countries out of this “seemingly endless cycle of disaster.” In addition, Sachs argues that governments and international institutions need to increase transparency and accountability to guarantee that the help really reaches the people in need. (Mail & Guardian)Fixing the Humanitarian Aid System (January 2006)
This article likens the international emergency relief system to a “lottery” where media coverage decides which countries receive aid. Furthermore, donor governments’ tie their decreasing contributions to their economic and political interests. Africa Renewal calls for a more predictable and fair distribution of aid funds and urges governments to support initiatives like the United Nation’s Central Emergency Response Fund (CERF). In addition, the article clarifies the controversy between food-shipments and locally bought food.Overview and Policy Messages: The Development Potential of Surging Capital Flows (2006)
In classic World Bank style, the overview of the Global Development Finance 2006 report acclaims the progress of global development finance. The bank continues to call on poor nations to create a favorable macroeconomic atmosphere that encourages investment and aid. The report praises financial integration among poor countries, increasing foreign direct investment appeal, and “judicious” management of development finances.
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