books

Dambisa Moyo’s ‘Dead Aid’: “Cut all Aid to Africa within Five Years”.

by Nelima

Even before the release of her book early this month, ‘Dead Aid’ had generated quite a buzz. Critics are pondering and debating Moyo’s suggestion for a cut to all Aid to Africa in five years. I have not had a chance to read the book, but wanted to share some of the reviews out there in the hopes that you can read the book and share your thoughts – as I will do too.

In an interview with the New York Times, she was labelled ‘The Anti Bono‘. She recalled meeting Bono at the World Economic Forum last year at a party to raise money for Africans, where she was the only African in the room.

I’ll make a general comment about this whole dependence on “celebrities.” I object to this situation as it is right now where they have inadvertently or manipulatively become the spokespeople for the African continent.

She makes a comparison to China;

Forty years ago, China was poorer than many African countries. Yes, they have money today, but where did that money come from? They built that, they worked very hard to create a situation where they are not dependent on aid.

Then talks about the African problem;

I believe it’s largely aid. You get the corruption — historically, leaders have stolen the money without penalty — and you get the dependency, which kills entrepreneurship. You also disenfranchise African citizens, because the government is beholden to foreign donors and not accountable to its people.

For the skeptics, Rwanda will be the litmus test. An article in AllAfrica stated that under Moyo’s consultation, the government last week vowed to cut dependency on Aid. On Dead Aid’s website Kofi Annan is quoted,

Dambisa Moyo makes a compelling case for a new approach in Africa. Her message is that “Africa’s time is now”. It is time for Africans to assume full control over their economic and political destiny. Africans should grasp the many means and opportunities available to them for improving the quality of life. 

However there have been many criticisms, Paraminder Bahra of the Times Online says;

Moyo is not the first to question the effectiveness of state aid, but her analysis is crude. There is no new research and her argument against aid is as spurious as the argument that it is bad to go to hospitals because many people die in them. To argue that all aid goes into the hands of corrupt leaders is naive and shows a lack of understanding about how aid is distributed and the projects that do promote good governance and institution building. The lack of any examples of how aid has been used is a huge omission – instead we have anecdotes about African leaders on shopping sprees with donor money.

 

Moyo is also content to throw democratic aspirations out of the window on the basis that: “The uncomfortable truth is that far from being a prerequisite for economic growth, democracy can hamper development as democratic regimes find it difficult to push through economically beneficial legislation.” This may also account for her unquestioning support of China and its activities in Africa. She supports the “hassle-free, no questions asked approach” of the Chinese. What Moyo does not explore are the contracts and the terms of trade of the deals struck with African nations.

Paul Collier who taught her at both Harvard and Oxford had this to say in his review;

So is there solid evidence to refute her claim that aid worsens governance and so impoverishes? Unfortunately, the research on whether aid is effective is frankly shambolic. At the level of an individual project we can often show it is effective, but this misses Moyo’s point: that what matters is the overall impact on the society.

By the same token, I think that Moyo’s message is over-optimistic. She implies that, were aid cut, African governments would respond by turning to other sources of finance that would make them more accountable. I think this exaggerates the opportunity for alternative finance and underestimates the difficulties African societies face.

Just today Reuters posted an argument against cutting aid to Africa;

Aid is also beneficial when trade is fair. There are several examples in Africa, like the case of coffee farmers in Uganda, where aid has been used effectively to improve the overall quality of the coffee seeds, thereby giving farmers better prices for their produce. When they have access to markets at home and abroad, they generate income which is ploughed back into increased output, better access to health and education, and overall improvement in the quality of their lives. To make this happen, developed countries need to stop procrastinating and put in place fair trade practices.

Aid works well if governments are accountable – in other words, when they are responsible and encourage active citizenship. On this continent, civil society is still weak and needs to be nourished. But stopping aid will not resolve frustrations about poor governance, which is partly a result of weak public scrutiny. Aid should be used to help fight corruption and promote accountability through active input from ordinary people.

Haven’t found a review from an African, if you have one share. If you can, read the book and share your thoughts. You can also read more about Dambisa Moyo and Dead Aid on her website.

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15 thoughts on “Dambisa Moyo’s ‘Dead Aid’: “Cut all Aid to Africa within Five Years”.

  1. Pingback: News about Finance and related topics » Dambisa Moyo’s ‘Dead Aid’: “Cut all Aid to Africa within Five Years”.

  2. This is very interesting. I had this conversation with my best friend back home about China coming in and doing all this development in a fragile country. We were both afraid that Liberia was being exploited, but the President keeps taking much of the investment and development is definitely growing, albeit at a slow pace.
    We both agree to be patient and see what happens.
    This is a great post.

  3. I have not read the book either, but from the preview on her website this is my current opinion.

    Does Africa Deserve Foreign Aid?

    To answer this question, one needs to analyze the continent through a microscopic lens.

    First, there are countries that have had stable governments since attaining independence. This group of countries doesn’t deserve any foreign aid and have no one to blame for their woes, but their lack of good governance. Giving these countries aid is perpetuating corruption and ineptness.

    Second, there are countries that have had political instability in the aftermath of independence. This category of countries, in my view, deserves humanitarian as well as direct foreign aid for reconstruction.

    Third and finally, there are countries that been in perpetual war(s) since independence. This last group deserves humanitarian support (aid) for the vulnerable groups (women, children and the elderly). Once these countries have solved their political quagmire, they will require direct foreign aid for reconstruction.

    Nonetheless, Africa’s economic and political liberation will not come from elsewhere, but within. With this recognition, Africa will be free at last!

    (I look forward to reading the book once it is published in the US. I hope you can set up a review discussion.)

  4. Hi Nelima, this is a thought provoking post that you have put together well with alternating view points.

    I lean very heavily towards Moyo and would say that trade and investment is the way to wealth. However, to say that all aid in Africa goes to corrupt leaders is probably being a bit extreme. There are some genuine instances where aid is and could be well placed.

    In order for aid in Africa to be effective it must go directly to the communities that it is meant to serve and not through the hands of politicians. The problem is that the more undeveloped the economy is that more difficult it is to side step the politicians. In my opinion this is why authors like Moyo and Ayittey are completely against aid to Africa.

    I just think that as with so many issues in life this issue is not completely black in white; as there are several shades of gray between the two. One of the types of aid that appeals to me is the kind that focuses on training and skills development. Once people have the skills that are relevant to the communities that they inhabit it is much easier for them to lift themselves up.

    Again, thanks for the great post.

  5. Pingback: Moyo to Bono: Africa Needs U like a Fish Needs a Bicycle « Technology, Health & Development

  6. Amen! I’m so glad to hear this alternative come to the forefront. I’m more than leaning in Bono’s direction. Yes, foreign aid does some good in Africa. Like the saying goes “give a man fish, you have fed him for a day, teach a man how to fish….” of course feeding the man today does some good. Hell if the man is starving, that fish is GREAT. But what if the man is no longer starving? Well I say Africa is no longer starving. It’s time we learn to fish. And I don’t mean TAUGHT to fish. I think if we have not learned by now, we are never going to learn. Or more importantly, maybe this lesson is just not for us. Maybe we need to take our own path to the river. Perhaps like Bono realizes, maybe cutting off aid will give us the right amount of incentive to do so. And if this mean we starve a little harder for a little longer, we must do so gallantly knowing tomorrow when we learn to fish our children can choose between salmon and tilapia for dinner.

    Besides the aid is not even going where the givers intend. (That is assuming the givers don’t have nefarious intents.) I think Paraminder Bahra belittles how much is going to the politicians. No, Mr. Bahra this is not based on the few sensationalized stories about shopping sprees. Foreign aid has made politics an economic class in Africa! Africans go into politics to be rich! No it’s not just the few the president is taking. It’s the few his cabinet is taking, their families are taking, local politicians are taking, the police and military is taking…that leaves less than few for the ordinary citizen.

    The current system needs changed, if for no other reason, simply because it’s not working. Remember the definition of stupid, “doing something over and over again and expecting a different result.” I think we are far from stupid. Let’s act like it.

    I can’t wait to read the book!

  7. Sounds like a great book and I can’t wait to get it.

    Here are my preliminary thoughts on AID to Africans both on the continent and in the US.

    AID when given to people based on their needs is crippling and causes dependency. AID needs to be given to Africans based on their skills. Meaning that rather than give money to people, inject it in industries.

    *When someone/country comes for AID the first question the donor should ask is for what skill do you need it for. If for business the donor should help set up the business and tell the person to run it and make it profitable else shut it down.

    *This goes for the relatives that you send money to. Ask them what they need the money for and if it’s for school pay the tuition, if for business fund the starting costs and let the recipient deal with keeping the business running. Constant handouts cause laziness and that what’s ailing our continent. Laziness!

  8. Nana, your post is woefully simplistic. Your short preamble talks about analyzing the continent of Africa (lets pretend that any kind of analysis of a continent will yield value) with a microscope. Ambitious, but unhelpful since in the tens of thousands of pages published on the development sector, no one has come to either conclusions or even agreement on definitions.

    Then you break down all African governments down into just three categories by the stability of their governments, as if this is the only variable that might affect the success or failure of a set of policies. What about terms of trade? What about colonial history? Natural resource wealth? Malaria incidence? Don’t you think it might be harder to succeed at establishing primary education if over a third of the population (meaning parents, teachers, administrators and government officials) have AIDS, and no drugs?

    Sure, corruption is a problem. But lets not pretend that we even have the legitimacy to make these determinations. After all, France has a revolution every 50 years or so. Even so, aid in complex emergencies often increases the length of conflict. Humanitarian assistance causes dependence and raises sovereignty issues (UNHCR is running camps created by human rights abusers that sit for 20 years, ruining lives and legitimating authoritarian behavior). Direct aid drives up currency problems through dutch disease. None of your suggestions make sense in all cases, and you aren’t specific enough about any individual case to even evaluate whether it is a good idea in that case.

    If you are really interested in these issues, you should check out the open university courses available on itunes, and if you find yourself more engaged, you can always get a more formal degree in Development Studies.

  9. Thanks Michael for your insights and criticisms, I already have degrees in development studies and have been blessed in pursuing professional work in development for over 25 years. While you may have read about development issues in Africa in published literature, I have had the privilege of working for the UN in all African countries, including the Islands and coordinated a team of over 350 distinguished African men and women from our prestigious universities and research institutions in assessment and documentation of the issues you alluded to. In conclusion, let me also mention that under my guidance, we prepared scientifically peer reviewed documentation of reports on socio – economic, health and environmental development failures on the continent that we launched before the African ministerial conference in Addis Ababa in 2003. if interested, I can give you the web page where you can access and even download Eight comprehensive reports.

  10. Oh, my, my what a subject – I have not read Moyo’s book but have watched an interview in which she discusses the mentioned issue. This is not an issue to tackle haphazardly, we are talking about people in need and in many cases are never consulted – I must read her book to know how much research has been done – has she spoken to the lay person, the receiver, it is time Africans are empowered to speak for themselves – the simplicity of the proposal seems to reduce Africa to one country , not the continent it is!

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