The Sub Saharan African region (the region) is the largest recipient of aid. Most of this aid goes to states in the Central African region (the sub region) such as Cameroon, Chad, the Democratic Republic of Congo, Congo Brazzaville, Gabon and Equatorial Guinea. Despite its position as the greatest recipient of aid, states in the Central African region especially, remain the poorest in the world. The vast resources embedded in the region and in the sub region specifically renders this fact paradoxical. What is really the cause of this very disturbing melee?
The African Economic Outlook opines that the average economic growth rate in the region, rather than picking up, has in fact decelerated from 6.1 percent in 2005 to a projected average of 4.8 percent in 2014. These figures are indeed disturbing as they remain far off the 7 percent growth rate target deemed important for the region and the sub region in particular to meet the targets set by the Millennium Development Goals (MDGs) in 2015.
In an attempt to redress the quagmire of underdevelopment, the region has been the centre of attention for large scale initiatives to redress its economic stagnation via aid increases. The sub region most especially has been part of this drive. Past international endeavors dedicated to poverty alleviation in the region such as the United Nations (UN) $25 billion Special initiative for Africa have not delivered to poverty alleviation in the region. Franklin Cudjoe of IMANI Ghana, Maud Martei and Pilar Rukavina in the 2014 second edition of a publication by Africanliberty.org, sponsored by the US based Atlas Economic Foundation opine that, rather than stimulating development , increased aid has gone hand in hand with increased dependency. According to these authors and other authors like Ayodele T, Noluyshungu T.A and Sunwabe C.K, more than $500 billion in foreign aid was pumped into Africa, with little to show for it. Indeed adversarial trends have been noticed as renewed aid influxes did not correlate with an improvement of economic performance as Gross Domestic Capital (GDP) actually fell. According to 2014 poverty data furnished by the World Bank Group in 1975 there were 140 million Africans living in poverty compared to 204.9 million in 1981, 360 million in 2000 and 413.7 million in 2010.
The evidence furnished in the above paragraphs show that rather than enhancing the region’s position, aid is serving to maintain the status quo by supporting corruption and policy mismanagement. As propounded by Boone P in a 1995 article entitled ‘Politics and the Effectiveness of Foreign Aid’, “aid does not significantly increase investment and growth, nor benefit the poor as measured by improvements in human development indicators, but it does increase the size of government.” This is observable amongst some of the poorest states in the region especially in the Central African sub region. States in the Central African region are all characterized by centralized regimes upheld by corruption and humongous influxes of aid.
The Global Financial Integrity, a Washington D.C. based non-profit organization that traces illicit money estimates that $1 trillion gets stolen from developing states especially in Africa in a typical year. Contrasted against the approximate $134 million that developing states receive, it suggests that foreign aid may simply be a drop in the ocean of a well-oiled corruption industry. In a study conducted in Chad in 2004, it was discovered that of a total sum of money released by the Ministry of Finance destined for rural health clinics, far less than the money actually reached the clinics. This is evidence that aid is not reaching its intended benefactors.
Blame for the continued embezzlement of aid money cannot be attributed to African leaders alone. There is clear awareness on the part of donors that such practices are occurring, signaling a disturbing tolerance for their continuation. Patricia Adams of Probe International has asserted that the World Bank was privy to the knowledge that, up to 30 percent of their loans was embezzled by corrupt officials. Despite the World Bank’s firm adoption of a zero –tolerance, good governance stance, corruption remains chronic throughout its projects due to inadequate supervisory procedures.
It is thus time to resist calls for pouring even larger sums of aid into countries in the region and in the Central African Sub region. Foreign aid has not proved to be the solution so far and will continue to elude Africans in particular as the solution to eradicating poverty. What is really needed in Africa is an enabling environment for free market institutions. A good starting point may be to inject the ideas of free markets in African Constitutions which so far have remained devoid of promoting free markets. Such a move must be thus followed by a reform of institutions like the judiciaries and taxation systems which would allow ordinary Africans especially those in the Central African region to take ownership over their own developmental process, thereby reducing the need for foreign financial assistance.
This article was originally written in French and published at LibreAfrique.org
Chofor Che is an analyst at LibreAfrique.org, an associate with AfricanLiberty.org and an integral part of the Voice of Liberty initiative. He is also a Doctoral Law candidate at the University of the Western Cape and blogs at http://choforche.wordpress.com/
Photo: A market in Cameroon. credit: happytellus.com