Is Continued Aid Bad for Africa? Why I Agree with Zambian Economist Dambisa Moyo.

The Chinese Example

Dambisa Moyo, the Zambian economist, educated at Harvard and Oxford and a former employee of The World Bank and Goldman Sachs, has created an inspiring, and provocative argument in her book titled “Dead Aid" - Why Aid Is Not Working and How There Is a Better Way for Africa.

It’s a small volume book which suggests that foreign aid to African nations, totaling over a trillion dollars in the past 60 years was a waste. She argues that it's bad for Africa, and for Africans. In her opinion Aid keeps Africa and Africans in a sub servant’s role at a critical time when its governments need to step up and become more self-sufficient. In her book she strongly recommends shutting off all foreign aid to African nations within 10 years.

This world renown author and economist shares critical information about the connection between free aid and corruption in Africa, and suggests that an alternative approach to relieving Africa from poverty would be much more beneficial than continued aid. The book argues that if affluent nations continue to throw money at poverty-stricken African countries, both sides will find themselves trapped in a vicious cycle of dependency and corruption and the latter will emerge in worse shape than before.

While employed at the World Bank and later Goldman Sachs, economist Dambisa Moyo spent considerable time and efforts, researching African development, or the lack thereof. Her research data set her on a mission to debunk the conventional wisdom that Africa would come apart were it not for international aid. Instead, she argues, Africa would prosper if affluent nations encouraged economic autonomy across the continent instead of dependency on foreign aid. It is a logical conclusion considering the wealth of natural resources in Africa. The country is rich in these resources but the people are poor. Why is this?

The statement and link below are excerpts from her book as expressed in her interview with BigThink (bigthink.com) on the subject of Aid to Africa: http://www.salon.com/ent/video_dog/big_think/2009/04/13/bt_moyo/index.html?source=video&aim=/ent/video_dog/big_think

Quote from Dambisa Moyo: “There are many reasons why aids to African do not work, the government to government aid that I am referring to. The most obvious one that many people may be very familiar with is the idea that this money going into Africa is authensively free in the sense that there are no constraints on how governments on the ground use the money, so its very easily corrupted and in fact there is a long history across the continent of a lot of money going into Africa being stolen and diverted for non productive uses. So corruption is an obvious one.

However, there are many, many other reasons why giving or sending billion dollar packages in the form of US dollars, for example, into small economies is very harmful. For example, you can see why having that kind of money flying into a country makes the government less inclined to raise money through other sources of capital because they have this steady flow of permanent income, what they perceive as permanent income coming in. The government develops what I call a ‘Lazy muscle’ and this breeds dependency which means that governments are not focused on actually building up other sources of capital such as the private sector which is important for growth. In particular it’s no surprise that things like education, healthcare, infrastructure, and even security are now being provided to Africa from outsiders and that leaves a situation where African governments have a questionable role – what is the role for African governments when they are not responsible for those things.

Are corrupt African leaders products of the aid model?

I don’t think in the African context you can separate the aid model from the political leadership that we have. The good African leaders that we do have across Africa are actually because they themselves have a moral qualm to actually do what’s right. What I mean by that is it’s all too easy if you are a good leader to become bad and the bad leader to become worst. So it is a reason why African history is littered with examples of despondent and tyrannical leaders across the continent who’ve stayed in power for many, many years and you know, even in those situations they have very clearly continued to receive aid monies. I wish I could sit here and say actually this is a figment of the past, its not, there are still many African leaders that are still facing charges, you know very regularly, most recently we’re still hearing of governments actually being sued for stealing aid money so this is not something from the past and I think its virtually impossible to strip out the aspect of political leadership from the aid model. The notion of a lack of accountability immediately comes in when you run the aid model.

What is the Extent of China’s presence in Africa?

I think what the Chinese have done in Africa in the last ten years has been amazing. They have brought in infrastructure where it has not existed before and they have provided jobs where we’ve not been able to get jobs in the past sixty years. Overall, I would say that they have been a positive force towards economic development in Africa. They have even diversified their approach to Africa. Initially it was very heavily dependent on the mining and mineral sector, oil and gas. They have now become much more focused on things like agriculture, banking sector, much more diversified. Now, this is not to say that the Chinese are perfect and that they should come to Africa car blanched. I think that there are many issues that the media, certainly the western media picked up on and there are a lot of scope for trying to actually improve the discourse and the alliances between African countries and the Chinese, but that is not the responsibility of the international community to police that. It’s the responsibility of African governments working – were they accountable to their people – to actually ensure that the Chinese are behaving in the best interests of Africa.” end quote.

The well documented, and unquestionable horrors of extreme poverty in African nations over the past century have created a moral imperative that people and affluent governments have responded to by donating millions in aid packages. Yet, despite these efforts poverty persists on massive scales - even during a time of unprecedented global prosperity. Despite efforts by American celebrities, children in most African nations are starving to death and/or dying from what industrialized nations consider unnecessary diseases. Why is this - are we not being generous enough? Perhaps the problem is not a lack of aid but an inevitable outcome of historical circumstances – and how affluent nations have dealt with the problem – and – the lack of accountability among African leaders, and finally – corruption!

In this provocative and compelling book, economist Dambisa Moyo argues that the most important challenge we face today is to destroy the myth that Aid actually works. In the modern globalized economy, simply handing out more money, however well intentioned, will not help the poorest nations achieve sustainable long-term growth. What is really needed is total involvement – inside the country, and on the ground. I am not saying aid doesn’t help – it just doesn’t work.

Education is the key to freedom and stability. Give a man a fish and he eats for a day. Teach him how to fish and he eats for a life time.

It's time to break the cycle!

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Comments 22 comments

Andrew Hawkley 7 years ago

Well written and argued. I think it was Joe Shumacher who said the policy of western aid was taking money from the poor people of rich countries and giving it to the rich people and of poor countries.


jxb7076 profile image

jxb7076 7 years ago from United States of America Author

Joe Shumacher was correct. I strongly believe it's time to break the cycle of dependency which will force the African Leaders to step up to their elected responsibility.

Thanks for the feedback.


Richard Mawanda 7 years ago

I think Dambisa is one of the continents' brightest economists.Throwing money to African problems is actully throwing it to African corrupt sychophants,it wont make a mark.Can anyone refuting the arguement stand to be counted?


jxb7076 profile image

jxb7076 7 years ago from United States of America Author

Hi Richard - sorry for the late reply. It's people like her who should be in power. If that was the case we would see African nations prosper beyond our wildest imaginations. I just don't understand people and nations who get caught up in the cycle knowing it leads to more dependence.

Thanks for the comment.


Sufidreamer profile image

Sufidreamer 7 years ago from Sparti, Greece

Good Hub - it is certainly a complex issue.

I just finished a paper about the Rwandan conflict, about how the poorly planned distribution of aid was one of the major contributors to the genocide. Throwing more money divided the country even more, and it was a tragedy that could have been prevented.

There is so much potential in Africa, and I hope that the continent manages to fulfill it. Looking forward to the World Cup in South Africa, and I hope that it can be a catalyst for change. :)


Simon Obwatho 7 years ago

Africa is not short of donor aid, we only luck correct economic policies and we will not blame the donors for that. we neither should spend time blaming ourselves.

LET'S INSTEAD DO SOMETHING ABOUT ECONOMIC POLICIES!


jxb7076 profile image

jxb7076 7 years ago from United States of America Author

Simon Obwatho - I am in absolute agreement!!! Thanks for stopping by and commenting.


AdsenseStrategies profile image

AdsenseStrategies 7 years ago from CONTACT ME at Adsensibilities@gmail.com

I believe she is the bright young economist I have seen on a number of videos via Google Videos. Her theories are certainly thought-provoking. I would suggest, however, that the economic miracle of Western Europe in the 1950s, for example, was built on infra-structure aid from the United States after World War Two (the Marshall Plan). This plan, incidentally, also required both Germany and Japan to adopt specific mechanisms of government (a constitution, democratic reform, etc). The Europeans also had a long tradition of running complex societies, with bureaucracy, education, transportation systems and so on...

It seems totally right to me that African potential must be channeled into entrepreneurship -- the very idea is very exciting, in fact. But, without accountable government, universal basic health care, and affordable water and sewer, it is very difficult to be an entrepreneur. So, while Africa must be its own salvation in the long-term, there is at the moment a huge need for aid... though this aid must go to the people who need it.. (see http://www.aidwatch.org.au/about-aidwatch ). Best wishes! I also have some hubs on poverty, if you are interested...


jxb7076 profile image

jxb7076 7 years ago from United States of America Author

AdsenseStrategies - thanks for stopping by and commenting. I am in agreement that aid is needed however financial stability will never become a reality until the leaders are made accountable, and the labor of the people are appreciated and rewarded by the government. I will take a read of your articles. The article on Aid Watch was very interesting. Thanks for pointing me to it.


SXP profile image

SXP 6 years ago from South Africa

Aid to Africa has been the one thing that kept tyrants in power. Sometimes we need to be cruel to be kind and in Africa's case, as an African, I see now other way.


jxb7076 profile image

jxb7076 6 years ago from United States of America Author

SXP - my apology for the late response. I agree with your opinion. Sometimes tough love is the best love. Thanks for stopping by and commenting.


jxb7076 profile image

jxb7076 6 years ago from United States of America Author

Sufidreamer - I responded to your comment but for some reason I do not see the post. Nevertheless, I would enjoy reading your paper about the Rwandan conflict. The research alone must have been an emotional rollercoaster!

Is it published on line somewhere?


snow_white88 6 years ago

Dambisa Moyo's "Dead Aid" surely is a must read... an inspiration to us all... fantastic hub jxb7076 :- )


jxb7076 profile image

jxb7076 6 years ago from United States of America Author

snow_white88 - I think Dambisa's book is right on target.


Kevin Schofield 6 years ago

Yes, you're right, I think there is a strong argument for finding an exit strategy from Africa's aid relationships. The wherewithal to live a decent life should be a human right, not a hand-out from powerful nations who have a vested interest in keeping Africans weak and dependent. Ultimately, non-emergency aid is disempowering and dehumanising.


jxb7076 profile image

jxb7076 6 years ago from United States of America Author

Kevin Schofield - I totally agree and the sooner the African Leaders who are receiving aid understand this the sooner their countries will start the road to true independence.


nuradin Omar 5 years ago

thanks sister, this is article that I had never seen before.


Powerpoe1 profile image

Powerpoe1 5 years ago

I definitely believe somethings need to be taught. Hand-outs produces a dependency. In my opinion, hard work builds values. If you continually support a person or nation that does not put their plan to action, nothing will become of the outcome. Great hub! Voted Up & Rated Beautiful!


jxb7076 profile image

jxb7076 5 years ago from United States of America Author

Powerpoe1 - thanks for stopping by and the candid comments. I truly believe the people of those african nations receiving funding have the ability to improved their economic circumstances if their governments invested in them.


pramodgokhale profile image

pramodgokhale 4 years ago from Pune( India)

I agree that aid does not work or develop that country and donor country reaps benefit Dambisa Mo yo is an economist and at present her book "How the West has Lost" in my hand and yet to complete reading and my comments thereafter.

Article is good one and awakening third world.

i am an Indian and since 1947, India faced many challenges and survived form superpower plots and machinations.


jxb7076 profile image

jxb7076 4 years ago from United States of America Author

pramodgokhale - thanks for your candid comment and observation. I will pick up Dambisa's book "How the West Lost". It sounds very interestng.


Levertis Steele profile image

Levertis Steele 3 years ago from Southern Clime

When Oprah Winfrey poured 40 million into Africa, she monitored her project from start to finish, and with good reasons.

This is certainly an interesting hub. How are handouts working for citizens in the USA? We hear cry about "entitlements" every day, but freebies are still rolling. Sometimes people really need help. Money and other support are given as a gesture of goodwill, and sometimes, they are given to cripple. I think that such effort should be monitored carefully and evaluated periodically. If there are no signs of real growth, something is wrong and changes need to be made. Continuing down a dead end is not the answer.

Even in a country suffering from a long drought, how many decades and trillions does it take before enough wells and irrigation systems are installed to help make life a little sweeter for the natives. Help given to any people should be for improvement and growth in education, quality of life, independence, and emulation. When that does not happen over a long period of time, it is time for evaluation and revampment.

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