Last week (September 2-4, 2008) saw Accra, the nation’s capital, hosting a huge gathering of more than 1,200 representatives of governments of aid receiving countries, donor institutions and civil society organisations to deliberate on how to improve the quality and impact of development assistance to recipient countries. That Accra was the venue for the Third High Level Forum on Aid Effectiveness, spoke volumes of Ghana’s increasing importance on the global circuit, especially where Third World politics and economic reforms are concerned.
In 2005, a similar forum was held in Paris, France, at the end of which the Paris Declaration was made, where donors and recipients pledged to use aid resources effectively to accelerate growth and achieve better development outcomes to reduce poverty among millions of the world’s population.
The Accra forum, as usual, ended on high expectations with copious pledges to make foreign aid more responsive to the development needs of recipient countries. It was generally agreed that the pace of development in most developing countries, especially those in Africa, had not matched the volume of donor cash, estimated to be about US$120 billion, which flows into these countries annually.
The forum also identified some of the factors that have contributed to the abysmal performance of most developing countries in spite of heavy doses of donor support. It was realised that a big chunk of donor funds go back to their countries of origin or institutions linked to them in the form of expenditures made on consultancy, monitoring and evaluation.
At the recipient level, corrupt practices associated with bureaucracies in the various countries, foot-dragging and red-tapeism collaborate to undermine the effectiveness of funded projects. Another serious observation was that very often, recipient countries are not allowed to make choices. In other words, most of the donor-funded projects have very little relevance to the development aspirations of recipients or at least do not constitute their priority areas.
Even though some civil society organisations and other pressure groups continue to press for better and effective use of donor funding, there are many others who continue to downgrade the role of foreign aid in the development strategies of developing countries. They prefer emphasis being placed on self-reliance and the effective utilisation of the abundant resources at the disposal of developing countries for their national development. The way out, according to them, is a fair and balanced trade arrangements that will enable developing countries to earn good money from their exports on the international market.
According to a report by the World Trade Organisation (WTO), “Trade openness is believed to have been central to the remarkable growth of developed countries since the mid-20th century and an important factor behind the poverty alleviation experienced in most of the developing world since the 1990s.” In other words, aid, it has generally been agreed, is not a solution to poverty alleviation. What developing countries should fight for, is a fair share of world trade.
Unfortunately, the governments of most developing countries, particularly those of Africa are failing to come to terms with this reality and continue to bank their hopes on aid as a solution to their development problems.
Ghana’s Minister for Finance and Economic Planning seems to be embedded in this line of thinking. In an interview prior to the Accra Forum, the finance minister insisted that foreign aid was necessary for the country’s development. He asked; “If we wean ourselves off foreign aid, who will buy our cocoa?” Not that this argument has any relevance to the subject matter, since selling a commodity on the world market is not the same as going round begging for foreign assistance.
If you sell your cocoa on the international market and make a good cash, that is business. Whoever bought that cocoa is not being charitable or magnanimous. He wants your cocoa, you want his money. It is a fair deal. Exchange, they say, is no robbery. That is vastly different from junketing from country to country begging any foreign entity on sight for support regardless of the conditions attached to such assistance.
Dr Ishmael Yamson, Chairman of the Board of Unilever and an advocate of self-reliance, said 50 years after independence, Ghana should have been in a position to wean itself off foreign aid.
Ghana has long depended on multilateral institutions such as the World Bank and International Monetary Fund (IMF) and the major Western countries like Great Britain, US, Germany, Japan and France for donor support. Unfortunately we have still not been able to come closer to development and to prove how miserable our situation has become, we are now shifting reliance on countries that were in the same trench with us a few years ago.
South Korea, China, India and Malaysia are among countries that have taken giant strides to become influential game players in the economies of African countries. If it is agreed that they also started like us, how come they have succeeded in gaining some appreciable level of economic independence and are able to lend a helping hand to countries such as Ghana and other African countries while we remain virtually in this beggar situation?
The explanation could be attitudinal and our philosophy towards development. We still believe that the rest of the world owe us everything while we remain firmly rooted in that master-servant relationship — a condition that has sapped our self-confidence and consigned us to the dustbin of subservience.
Mr Baah-Wiredu may be right that we still need some amount of foreign assistance and I believe that is a global reality that no country can ignore, no matter how rich or powerful. But foreign assistance should be a secondary source of support. If it becomes the primary, then we have little to be proud of as a sovereign nation.
That makes relevant, Dr Yamson’s argument that the country is putting too much emphasis on foreign aid. He and those who share his view never argued that Ghana and for that matter Africa should live in isolation. That is not possible. Their position is that Africa seems to be the only continent where foreign aid is worshipped with religious fervour. And the difference is clear.
Inter-dependency cannot be the same as over-dependence or total-dependence. When two or more countries strike a business deal as equal partners, there is nothing like master-servant relationship. That definitely cannot be the same as the situation whereby a sovereign nation cannot do anything without the intervention of foreign powers. It cannot be the same as a country that cannot prepare its national budget without factoring in the financial support it expects to receive from outside donors.
The dependency syndrome if not checked, will keep us in perpetual bondage and stifle local initiative. That is why Dr Yamson said that: “If we continue to be aid-dependent, we will continue to be poor.”
Aid debases our nationhood and renders senseless, any claim to sovereignty and independence. As the richest continent in terms of natural resources, African leaders’ concern should be how to harness and utilise these resources and how to capture a big share of the world market and not how to strategise to receive more donations from others.
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