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| How NEPAD can engage with Poverty Reduction Strategies: Developing an appropriate framework |
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3. Aid
Historically, aid in Africa has been used to fill the savings gap. NEPAD offers good governance for aid.
Points to consider:
- Despite massive aid, massive conditionality of aid Africa has failed to achieve significant progress for its population.
- The system as a whole is dysfunctional.
Why?
- Independent policy-making and national economic management has considerably diminished and narrowed (see A. Adejeji, 1995)
- There are so many ulterior motives that go with donor monies/ODA. Many Individuals have noble motives and achieve impossible things in their interaction across the donor-recipient table. One need ask why conditionalities have been violated and aid continues to flow into Africa. A case in point is the Bretton Woods institutions' denial of PRSP for Kenya on the ground of corruption. Somehow, President Moi managed to woo back the Bretton Woods institutions and the PRSP. In this case one may as well argue that aid is good governance-averse.
- ODA has been good for donor agency/staff survival, livelihoods and careers.
- ODA increases the dependency syndrome for Africa making its governments less accountable to their own people and stretching themselves to please the donor. The borrower will always remain a servant of the lender.
- ODA has contributed to Africa's high levels of indebtedness. It has been well documented that for every dollar from the donors about $13 goes back to the North in form of debt service. It is therefore unwise for NEPAD to put its faith in ODA as the solution to the economic woes bedeviling the continent.
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