Development assistance uncertainty

Jeff Sachs on the need for predictable aid flows:

Following the G8 pledge in 2005 there have been no proper timetables set out for African countries explaining to them how their aid levels will rise to meet the 2010 pledge. In country after country, African leaders and finance ministers are told by local representatives of the donor agencies that there is no information as to how or when aid levels will increase to meet the commitment. In some countries, recipients of US development aid have been advised that aid, other than that for HIV/Aids and malaria, is being cut as budgets are shifted to Iraq.

It is understandable that G8 finance ministers would like to leave themselves maximum flexibility in the timing and direction of aid, but this approach to development assistance ends up being self-defeating.

Instead of a rational process of raising critical investments, we have a guessing game. Will the aid be doubled or not? Will it be doubled as an accounting trick (for example, by cancelling unpayable debts and labelling each dollar of debt cancellation as a dollar of aid), or will it be an actual flow of commodities and cash? Will the aid come as fees for high-priced consultants or as funds for practical investment? Will the G8 wait until 2010 to increase actual cash flows, or will the aid increase step-by-step between now and then?

1 thought on “Development assistance uncertainty

  1. Milan

    I can see how it would be impossible for recipient government to do decent planning on the basis of this. Knowing what investments make sense and how many people can be hired cannot be done without financial data across a longer timespan.

Comments are closed.