Despite of the growth in some countries who received aid, there is still question whether it is merely because of aid. I believe it is not since there were cases showing that even in the presence of aid, growth rates did not improve. An example provided by Moyo (2009): “Between 1970 and 1998, when aid flows to Africa were at their peak, poverty in Africa rose from 11% to a staggering 66%”. Aid is not a prerequisite for growth, in many cases, it is even a hindrance for it and has other bad effects on the recipient countries. Aid usually goes with the conditionalities set by the donors: “First, countries that take aid have to spend it on specific goods and services which originated from the donor countries, or a group selected by them. This extends to staff as well: donors employ their own citizens even when suitable candidates for the job exist in the poor country. Second, the donor can reserve the right to preselect the sector and/or project that their aid would support” (Moyo, 2009). There might be a thought that the second conditionality will prevent aid from worsening corruption, yet things are different in practice. “A World Bank study found that as much as 85% of aid flows were used for purposes other than that for which they were initially intended” (Moyo, 2009). “Even as far back as the 1940s, international donors were well aware of this… In 1947, Paul Rosenstein Rodin, the Deputy Director of the World Bank Economics Department, remarked that ‘when the World Bank thinks it is financing an electric power station, it is really financing a brothel’” (Moyo, 2009). So, “after the multi-billion-dollar ‘financial flows’ involved have been shaken through the sieve of over-priced and irrelevant goods that must be bought in the donor countries, filtered again in the deep pockets of hundreds of thousands of foreign experts and aid agency staff, skimmed off by dishonest commission agents, and stolen by corrupt Ministers and Presidents, there is really very little...
References: Moyo, Dambisa (2009) ‘Aid is not working ', Dead Aid:Why Aid is Not Working and How There is Another Way for Africa, New York: Farrar, Straus and Giroux, pp. 29-47.
Hancock, Graham (1989) ‘Aid does not help’, Lords of Poverty: The Power,Prestige and Corruption of the International Aid Business, New York: The Atlantic Monthly Press, pp. 185-194.
Shank , Michael (2013) ‘Aid Gone Awry in Africa’, U.S. News, 19 June.
"Aid as % of GDP" (2014). URL: http://www.nationmaster.com/country-info/stats/Economy/Aid-as-%25-of-GDP
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