On the Wing

Flying in the face of widespread left wing extremism!

Foreign Aid Has No Effect

Posted by Exile on January 14, 2008

I think we’ve all known it for years, some of us have even been saying it. Now it appears, we were right. Foreign aid is not working, nor does it have any effect on the countries receiving it acording to a new study from Århus University in Denmark. The Copenhagen Post brings us this;

New studies from Århus University shows that Danish billions do nothing for development of poor countries.

A surprising conclusion in a brand-new report states that the total Danish contribution of DKK 14 billion to developing nations has no effect on economic growth or promoting democracy.

The conclusion of an extensive study by professor Martin Paldam of Århus University has MPs across party lines calling for more investigation into the matter. They suggest that the effects of Danish development aid be investigated in more detail and said that the money had to be used in the best possible way.

Paldam had studied the development of 46 sub-Saharan African countries, where 14.5 percent of their gross national product (GNP) consisted of development aid over the last 15 years. The study showed that Danish aid had had a decreasing effect on the development of these countries. He urged officials to re-think the whole machinery of Danish aid, as it had no decisive results on the economic growth, democracy or fight against corruption in the developing countries. ‘If politicians also want to create development and not just give social aid, the whole notion of the aid must be revised,’ Paldam said.

Frankly, I agree with him. The whole notion of simply throwing money at a problem without real controls on the spending of that money is ludicrous. Simply putting huge amounts money into the hands of corrupt leaders in African countries is not helping anyone. Not everyone agrees with him though.

Conservative MP Lars Barfoed said it was too early to draw conclusions and emphasised that other international studies gave Danish development aid top marks. The new report comes at a time when the Liberal-Conservative government is discussing whether is should increase its developmental aid.

These other international reports that Barfoed is citing are usually concerned with the amount of aid given, not the effect of having given it. They are more concerned with how big the slice of the pie is, not how it gets eaten. The truth is that, in Denmarks case, we give 0.8% of the GNP where most others give less. Which would be the “top marks” he is referring to. Our slice of the GNP pie is generally bigger than that of the others.
The New Alliance and Social-Liberal parties want to increase foreign aid from 0.8 to 1.0 per cent of the GNP. Though it beats me as to why. Only Norway gives more than us. Why should we be number 1 on the giveaway billboard? Who are we trying to impress?

One of the New Alliance’s party founders, Gitte Seeberg, did not deem it necessary to revise the development aid strategy.
‘It’s possible that there is no economic gain, but people are gaining clean drinking water. Not everything can be measured in terms of money,’ said Seeberg.

Fresh water? Is that all you can boast about for 14 billion Danish Crowns year after year? Give me that much money and I’ll give the whole of Africa fresh water within six months. How much can a drilling rig on a truck cost? And as for not everything being measured in terms of money? Well, that’s OK for Gitte Seeberg to say, but it’s my money she’s talking about. My taxes, my earnings, and those of every other hard working overtaxed citizen in this country.

The best way to give aid is to give it directly to the people trying to improve their own situation. Giving it to governments made up of tribal families is no way to do business. How much more time and money will it take until they realise that?

By the way, here’s how we compare with our generous neighbours. (% in terms of GNP.)

1. Norway               0.92
2. Denmark               0.84
3. Netherlands               0.81
4. Luxembourg               0.8
5. Sweden               0.7
6. Belgium               0.61
7. Ireland               0.41
8. France               0.41
9. Switzerland               0.38
10. United Kingdom               0.34
11. Finland               0.34
12. Germany               0.28
13. Canada               0.26
14. Spain               0.25
15. Australia               0.25
16. New Zealand               0.23
17. Portugal               0.21
18. Greece               0.21
19. Japan               0.2
20. Austria               0.2
21. Italy               0.16
22. United States               0.14
Source: OECD Web site
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