The Reality of Aid 2000

THIS IS THE seventh annual analysis of the aid and development policies of the world's donor nations, based this time on figures from 1998 and undertaken from the perspective of effective poverty eradication. As in earlier editions, an assessment of the context and overall trends is followed by a report on each donor country, prepared in each case by a contributor, generally from an NGO within the country, who is able to offer an expert assessment of that country's aid policies and priorities. For the second year running, the report also offers a final section by Southern contributors to achieve a more balanced perspective in assessing donors’ poverty reduction efforts.
Overseas development aid rose in 1998 for the first time in several years but this development needs to be seen in context. During the 1990s, private capital flows to low and middle-income nations rose dramatically. At the same time, official grants and bilateral loans fell sharply. The overall inflows of capital allowed for considerable growth in many countries but this growth was unstable and masked large trade and debt payment deficits. Although there was some reduction in poverty as a result of economic growth, there was almost no improvement in the unequal distribution of income – and these inequalities are increasingly seen as inhibiting healthy growth and poverty reduction. With the advent of
the financial crisis in Asia and other areas, starting in 1997, private flows dropped and many people in affected countries fell back into poverty. Rescue packages for economies in crisis account for much of the recent increase in bilateral aid but the gap between rich and poor countries, rich and poor people, continues to grow.
The editors point out that poverty centred development goals have gained ground in almost every donor country – a reflection of the three-year-old Shaping the 21st Century strategy which has the eradication of poverty as its central goal. But, still, only three donors are actually paying their agreed-upon “fair share”. Furthermore, aid can only play a minor role in tackling poverty, and changes in aid policy are not resulting in the kinds of partnerships with recipient governments that are truly necessary to overcome the problems. The priority to basic needs is slowly improving and, in many donor countries, gender is increasingly treated as an integral part of policy. But debt relief continues to be a rather empty promise, development programmes tend still to be driven by donor priorities and recipient country “ownership” and responsibility, frequently cited as a condition for progress, are too often absent. The rhetoric may have improved but it is still not accompanied by the kinds of commitment and action that are necessary to support poor countries in tackling their most fundamental problems.
The assessment of current trends is followed by a report on each aid donor; in this volume, the focus is on basic education. The following section considers the perspective of a range of Southern countries on development cooperation, again prepared by a national NGO, and again focusing especially on basic education. The volume concludes with “at a glance” comparisons of donor performance and commitments for the twenty-first century, and with a reference and resource section. The text is illustrated throughout with clear diagrams and graphs, and with boxes and tables offering further detail.