Has British Aid Policy over the Past 20 Years Been Effective - Case Study Example

Has British aid policy over the past 20 years been effective? Being “the first G7 nation to hit the international target for aid of 0.7% of national income” (Barder 2015), Britain has gone a long way in an attempt to eradicate global poverty with its aid policy over the last 20 years. This paper reviews major accomplishments of British aid policy and its outcomes in this period. Effectiveness of British aid policy is evaluated on the basis of outcomes in the low-income countries. Subsequently, underlying problems hindering the effectiveness of British aid policy are identified. Despite having helped the poor countries in various ways, British aid policy’s effectiveness has been impaired by racial prejudices, monopoly, and economic imbalance in the low-income countries. Britain has pledged to provide the low-income countries with 90 per cent of bilateral aid, but only where the aid is judged to make the maximum difference (loc.gov 2014). Almost three-quarters of the UK Official Development Assistance (ODA) had been given to low-income countries by the year 2004, which was up from more than 65 per cent during the preceding decade (Riddell 2007). Following the decision to restrict the bilateral aid share allocated to middle-income countries to 10 per cent in 2004, most of the increase in British aid is meant for the low-income countries and Africa (Riddell 2007). 150 different recipients received the British bilateral aid in 2002 which was 50 per cent above that in mid-1960s, but still lesser than the apogee seen in the 1990s i.e. 168 (Riddell 2007). The top ten recipients of the UK received 58 per cent of its bilateral aid (Riddell 2007). Britain has shown commitment to humanitarian crises and emergency response. Together with the UN, Britain has been trying to make the international response mechanisms more effective. Britain’s role in assessment and development of strategies to aid the fragile states is also appreciable. Over the decade preceding 2006, UK bilateral aid (ODA) share that was channeled to emergencies wavered from 10 to 15 per cent level (Riddell 2007). Poverty reduction was established as British aid’s overarching purpose with the International Development Act 2002 (Lankester 2013). The Act requires all aid to meet the tests of poverty reduction and welfare improvement or sustainable development with the exception of aid meant to relieve disasters’ effects, contributions to the banks involved in multilateral development, and aid to the Overseas Territories. Department for International Development (DFID) played a major role in securing international agreement upon the Millennium Development Goals in 2000 with its greater poverty focus and rising budget (Department for International Development n.d.). The aim was to reduce extreme poverty by half by the year 2015 and to also expedite other well-being measures. Efforts to achieve these goals have also been facilitated by ODA, though many goals may not be completely met because of the inadequate flow of aid from other donors. Before 2000, British aid was tied to the purchase of British services and goods (Butler 2002), but the trend was altogether abolished in 2000 (Lankester 2013). This increased the effectiveness of British aid as it was no longer subject to the conflicts and pressures experienced before in Pergau. Alongside, DFID secured improved effectiveness of aid which reached partial fruition amongst other donors in the year 2005 in the form of Paris Declaration on Aid Effectiveness (Lankester 2013). Despite the fact that some success has been achieved in light of these findings, British aid policy has not effectively eradicated poverty from the sub-Saharan Africa and other low-income countries. The key to understanding the solution of global poverty is to explore the underlying causes. In order to effectively eradicate poverty, Britain needs to permeate and cut through the thick net of racial prejudices, inequality, and economic imbalance in these societies. The experience of South Africa is instructive in that the whites established apartheid for their personal benefit in the country. The whites monopolized resources, economic opportunities, and political power. While the blacks were impoverished, the whites became as prosperous as the ones in the first world countries. Similar government-created monopolies are observed in the Middle East in Syria and Lebanon. Reflecting upon the problem, David Cameron said at New York University, “There is a huge agenda here where we stop speaking simply about the quantity of aid [and] start talking about what I call the “golden thread”, which is you only get real long-term development through aid if there is also a golden thread of stable government, lack of corruption, human rights, the rule of law, transparent information” (Cameron cited in Eighth Report of Session 2012-13). Angola is an example of the countries heavily aided by the UK but is still deprived. UK has generated £48 million from 1993 to 2000 for Angola while the DFID Angola programme for 2003-2006 was valued at some £9 million per annum, and even more aid was generated in the subsequent years (Chatham House 2009), but Angolans did not really benefit from this aid; while no more than only 34.6 per cent of Angolans could access electricity from the year 2010 to 2014 (The World Bank 2015) and with 33.33 per cent Angolans surviving on incomes below $2 a day (Peel 2013), the long-serving president and the richest woman Isabel dos Santos is a billionaire and was reported in Forbes as, “As best as we can trace, every major Angolan investment held by dos Santos stems either from taking a chunk of a company that wants to do business in the country or from a stroke of the president’s pen that cut her into the action” (Dolan 2013). British aid policy cannot be effective unless such economic imbalance is targeted and eradicated from the low-income countries. The theory of economic development has been conventionally dominated with the idea that poverty can be remedied with large donations. This is the thinking that has prevailed in most governments and international aid agencies since the 1950s. Results suggest that there is something inherently flawed about this argument. “[B]etween 1981 and 2010, the number of poor people in the world fell by about 700 million — and that in China over the same period, the number of poor people fell by 627 million” (Acemoglu and Robinson 2014). While millions of people have come out of abject poverty over the last six decades around the world, yet this cannot be attributed to foreign aid. On the contrary, more than 25 per cent countries in the sub-Saharan Africa are economically more deprived today than they were in 1960 (Acemoglu and Robinson 2014). Liberia provides evidence of failure of foreign aid by Britain. After receiving massive aid for almost a decade in which the official development aid summed up to $765 million (Glencorse 2013), each of the 25000 students, who had appeared in the exam to be granted admission in the University of Liberia failed (Smith 2013). These statistics reflect that much needs to be done in many important sectors like education to increase the effectiveness of British aid policy. To conclude, despite the concerted efforts and a prudently crafted out and carefully implemented aid policy, Britain has not managed to alleviate poverty and address other issues of huge significance and concern to the underprivileged people in the low-income countries beyond targeting the poverty at a surficial level. British aid policy cannot be effective without establish good governance in the countries. In the post-2015 framework, Britain should redirect its aid policy to target global poverty by establishing the golden thread, which means a system of good governance, healthcare, education, law and order, empowerment, collectivity, and fairness in the low-income countries. Promoting the golden thread means using more than just aid to include diplomatic relations so that reforms remaining in the extractive institutions’ grip can be conducted. This can be achieved by using both diplomatic and financial clout to create room for growth for the inclusive institutions. Bringing about such changes through reforms is more difficult than rendering financial aid, but is more effective in making poverty history. References: Acemoglu, D, and Robinson, JA 2014, Why foreign aid fails - and how to really help Africa, The Spectator, [Online] Available at http://www.spectator.co.uk/features/9121361/why-aid-fails/ [accessed: 8 April 2015]. Barder, O 2015, A Development Policy for the 21st Century, Center for Global Development, [Online] Available at http://www.cgdev.org/blog/development-policy-21st-century [accessed: 8 April 2015]. Butler, LJ 2002, Britain and Empire: Adjusting to a Post-Imperial World, I.B.Tauris. Chatham House 2009, Programme Paper AFP 2009/02: Angola Fact Sheet, [Online] Available at https://www.chathamhouse.org/sites/files/chathamhouse/public/Research/Africa/angola_fact_sheet.pdf [accessed: 8 April 2015]. Department for International Development n.d., Economic development for shared prosperity and poverty reduction: a strategic framework, [Online] Available at https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/276859/Econ-development-strategic-framework_.pdf [accessed: 8 April 2015]. Dolan, KA 2013, Daddys Girl: How An African Princess Banked $3 Billion In A Country Living On $2 A Day, Forbes, [Online] Available at http://www.forbes.com/sites/kerryadolan/2013/08/14/how-isabel-dos-santos-took-the-short-route-to-become-africas-richest-woman/ [accessed: 8 April 2015]. Eighth Report of Session 2012-13, Post-2015 Development Goals: Eighth Report of Session 2012-13, Vol. 1: Report, Together with Formal Minutes, Oral and Written Evidence, The Stationery Office. Glencorse, B 2013, A decade of aid dependence in Liberia, devex, [Online] Available at https://www.devex.com/news/a-decade-of-aid-dependence-in-liberia-81634 [accessed: 8 April 2015]. Lankester, T 2013, The Politics and Economics of Britains Foreign Aid: The Pergau Dam Affair, Routledge. Loc.gov 2014, Regulation of Foreign Aid: United Kingdom, [Online] Available at http://www.loc.gov/law/help/foreign-aid/uk.php#_ftn109 [accessed: 8 April 2015]. Peel, L 2013, Angolas poor people hit hard by urbanisation crackdown in Luanda, the guardian, [Online] Available at http://www.theguardian.com/global-development/poverty-matters/2013/may/10/angola-urbanisation-crackdown-luanda [accessed: 8 April 2015]. Riddell, RC 2007, Does foreign aid really work? Oxford University Press. Smith, D 2013, All 25,000 candidates fail Liberian university entrance exam, the guardian, [Online] Available at http://www.theguardian.com/world/2013/aug/27/all-candidates-fail-liberia-university-test [accessed: 8 April 2015]. The World Bank 2015, Access to electricity (% of population), [Online] Available at http://data.worldbank.org/indicator/EG.ELC.ACCS.ZS [accessed: 8 April 2015]. Read More