An environmentalist, venture business woman, one of the discoverers of crystal growth technology for inexpensive electricity production, and the owner of the private Fund of entrepreneurs-inventors known as Territory of "Shell".
Wednesday, June 11, 2014
Aid for the poor or for the rich?
Good news for once! British foreign aid has finally reached the 0.7% mark! As you will no doubt know, there has been a longstanding target encouraged by the UN Development Programme to encourage rich countries to give 0.7% of their GDP as foreign aid to help poorer countries overcome their disadvantages and improve the lives of their citizens. Until recently, only the Scandinavian countries and a few others had managed to achieve this fairly small sum, but now Britain can join the club and hold its head up high in the international community (although not so much at home, where this success has been barely mentioned for fear of annoying the xenophobes who believe no money should be given to help anyone outside of the country).
Unfortunately, before we start celebrating too wildly, there is a problem – and it is the rather major one of where most of the money is actually going to. We like to think that aid money goes directly into vaccination campaigns, building schools, providing emergency medical supplies, and so on. In actual fact, a lot of it goes into private developments and projects that aim at generating a profit (for local capitalists and in many cases British corporations as well) rather than achieving many social benefits.
Much of the money is placed into financial corporations, who then choose where to invest it for the good of everyone. This is part of the ideology that the government has no ability to run things competently, and that we should all rely on the private sector to look out for our best interests. Of course, this completely ignores the private sector’s insatiable drive for more and more money, and consequently much of the aid money ends up going into things that will be unambiguously profitable – private apartment buildings, hotels, shopping centres, and so on. The idea is that by making certain local businesses rich on the profits of these investments, the money will eventually ‘trickle down’ to the general population. That this has not worked anywhere in the world seems to be ignored; the idea of simply giving the money directly to the things that poor people need is not entertained.
Other controversial schemes involve agriculture. In some African countries, agricultural aid is only being given if governments agree to strict requirements – in particular, not to restrict exports under any circumstances. This means that even if a famine hits East Africa again, exports of food for foreign markets will still take priority over feeding the local population. Cash crops like coffee and chocolate are also more likely to receive aid money, despite being of almost no use to local people; as are transport and infrastructure links to ports, allowing these crops to get onto the world market quickly and efficiently. These schemes benefit the country providing the aid money as much as the country receiving it, but many poorer governments feel they have no choice but to accept these requirements in order to get enough money to do something for their own people.
Essentially, these schemes prove what we have long known – that aid is often a way to extract resources from poor countries and to prop up the structural inequalities in the global economy that keep them in poverty, rather than a means to truly help the wretched of the earth. It makes governments look good (at least to some people), while not requiring them to do anything really unpopular or detrimental to the needs and desires of the corporations from their countries. Consequently, until we devise a new and fairer aid policy that actually aims to help poor people rather than businesses, there is perhaps not too much to celebrate about finally hitting that tiny 0.7% target.
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