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Submitted by Anonymous on
Ending aid to Africa is not politically desirable, at this stage, for objective and subjective reasons. Indeed,countries with low capital base have no other choice than to rely on Official Development Aid(ODA)to sustain their economies. In Burkina Faso, for example, 80% of public investment expenses are funded with ODA, and in 2007, aid accounted for 15.18 % of GDP. The country's economy is based on cotton production( about 60% of total exports) but we all know that raw cotton export is not a stable revenue stream in view of the distorsions in the international cotton market. Fortunately, many other Sub Saharan African countries are well endowed with natural resources and there are no objective reasons why these countries should not develop themselves on their own. But if they continue to rely on ODA, it is simply because their leaders are keen to pocket half of the funds they receive at the expense of their poor people. Leaders of donor countries have also incentives to continue to deliver ODA despite these conditions because it serves to mask their businesses non competitive behaviour that allow them to acquire recipient countries' exports at very low prices. I'd like to get any cross country evidence on aid effectiveness in Sub Saharan Africa. I bet that aid is likely to be less responsive to poverty reduction in resource-rich African countries. However, I totally agree with Tijan Sallah that aid itself is not a bad thing if properly utilised. The problem is, as he and some readers already pointed out,bad management of public finance(whether the money comes abroad or within the country):corruption and absence of time value of money considerations makes self-development a far distant goal for most Sub Saharan African countries in my view.