End the ‘Aid vs. Trade’ debate
Only six years away from the 2015 deadline, world reports indicate that none of the Sub-Saharan African countries is currently on track to attain the Millennium Development Goals (MDGs).
The African continent is home to 20% of the world’s population which collectively, partakes in only 2% of global trade. This year, the impact of the global economic crisis is expected to slash growth rates on the continent down to 2.8 per cent, less than half of the average growth rate achieved during the past five years.
A new wave of African politicians and journalists has been engaging in a debate that Africa’s salvation lies not with further infusion of aid but rather in stepping up trade. It is argued that western assistance to developing nations has given rise to dependency and created a suitable environment for corruption.
In the west, tax bases are shrinking and unemployment has reached record highs because of the global recession. Like never before, western purses are squeezed by the need to take care of their own people thereby reducing surplus resources and limiting generosity towards African problems.
By press time, the US national debt amounted to US $ 12 trillion and was increasing at US $ 3.85 billion per day – the largest national debt in the world. It is safe to assume that even the USA could use some debt relief and aid money to mitigate the risk presented by such debt on future generations.
Unfortunately for the US it cannot receive aid since it is perceived to be the most prosperous country on earth and while for decades, Africa, has been painted by the global media as a continent of desperation and suffering thus deserving of aid.
While aid is blamed for many challenges in Africa today, it is important to note that it was born of a need to defeat global health, administrative and social challenges and to balance inequitable global resources.
A case in point, in 2006, more than half the Uganda’s mostly aid funded annual budget was lost to corruption amounting to US $ 950 million. A considerable amount of the money that was stolen had been intended to provide vaccinations and treatments for tuberculosis, malaria and HIV – epidemics that are not in a recession.
In calling for an end to aid, African administrators epitomize the saying, ‘a bad workman blames his tools’, since it is them that are responsible for the mismanagement and misappropriation of aid money, given out of generosity by western taxpayers.
True, aid monies bring forth several challenges – like setting rigid terms and failing to adapt to rapidly changing conditions on the ground. However, African administrators should behave like the good workman who will struggle to do a good job even with bad tools.
Trade and charity run parallel. The west will not donate trade to Africa in the same way that it donates aid and therefore the Aid vs. Trade debate does not hold. With trade, Africa simply needs to take action instead of calling out for help.
Where charity promotes generosity, trade presents competition – sometimes cut throat. In some sectors, Africa will have to compete with some of the very nations that have been offering it aid. Therefore, the continent Africa will need to marshal all her bargaining chips through continental integration and closely guard mineral and oil resources from exploitation by more powerful nations.
It is important for the continent to rectify its faulty policy making framework and build stronger institutions before it can engage the west as a worthy trading partner. Neither trade nor aid will amount to continental progress if institutions remain deficient of integrity.
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