wongskc said:
http://www.theglobeandmail.com/servlet/story/RTGAM.20051125.wbono1125/BNStory/National
Now, personally, I couldn't care any less what a non-citizen/non-resident/non-taxpayer thinks about our fiscal and foreign policies. However, the article got me thinking about the effectiveness of foreign aid. Does anyone have any links or references to studies on the actual results from foreign aid? As well, studies on its feasibility, how it might be changed to be more effective, etc.?
If it's just data you want there is tons of it, supporting whichever position one might wish: from
"send nothing, it all gets wasted by corrupt recipient governments, àla Mugabe" to
"more, more, more - we are morally bound to atone for the evils of colonialism." Try e.g. here: http://www.jha.ac/articles/a128.htm or http://www.fraserinstitute.ca/shared/readmore.asp?sNav=nr&id=373 .
Before going to either, however, I think we should remind ourselves about the purposes of foreign aid. I think there are, very broadly, three aims:
1. To (improperly and inefficiently)
subsidize our own industries;
2. To
bribe foreign leaders; and
as a far distant third
3. To
help poor people overseas.
Sometimes we, Canada, did 1 and 2 together. In the '50s and '60s we were famous for building
railways to nowhere all over Africa, 'Leaders' of newly independent African countries came to Ottawa and left, after lots of champagne, with a new railway. The announcements were not, usually, made by the Foreign Minister in Ottawa or Africa, rather a Québec minister made the announcement of a new locomotive/rail car contract in Montreal. The car, first, and then the airplane spelt the death of the passenger rail service and with it good, high paying jobs in the locomotive and rail-car plants in Montreal.
Railways to nowhere were a perfect way to subsidize a failed industry in Québec
and buy votes in the UN where Canada was (throughout the '50s and '60s) waging a campaign to 'lead' the lesser powers.
In the '50s, especially, we had what was known as the
Indian love affair. Lester Pearson - first as a diplomat, later as External Affairs Minister was a
patron of newly independent India. Canada poured vast amounts of aid into India, Pakistan and Sri Lanka. The Canadian invented
Colombo Plan was second only to the US' Marshal Plan in generosity and might, actually, have been more beneficial to Canada, for a longer time, than the Marshal Plan was to the US. The Marshal Plan did more
for the recipients, however - largely because they were better able to
leverage the aid to rebuild their economies.
The Colombo Plan was a good example of 2 + 3, although there was some industry subsidization, too.
Almost all government-to-government aid is 95% 1 + 2 - it doesn't matter who the donor and recipient are. Canada's aid (we still give quite a bit) to China is mostly 2 and China's aid to Africa is the same.
There are a few great examples of 3 - but mostly in the private sector. My favourite is the 'banks' in Asia which lend, almost exclusively, to women for small, local projects. The returns - for donor and recipient village - are almost universally excellent: far and away 'better' in quality and quantity than
anything CIDA does or has ever done.
I will note that the Asia Development Bank (ADB) is the best at putting its money where its mouth is. Many western nations are embarrasingly horrid at how much money touted as "development", actually makes it to help the locals here. One just has to be very careful with one's charities as many charities have huge overhead....just because it's a "non-profit" organization doesn't mean a higher proportion of dontations hit the coal face.
