Inherent flaws in the global aid system.

For decades, rich countries have been allocating billions of dollars each year to aid poorer countries around the world. Yet, the ability of this aid to address even the most basic deprivations plaguing the so-called 'developing world' remains modest at best.

There are several reasons why foreign aid remains ineffective. One is the amount of aid allocated for 'development' purposes. Rich countries are hard pressed to spend 0.7% of their national incomes on international aid, primarily meant to address poverty caused in the global south due to centuries of colonial exploitation. Of course, exploitation of the global south did not end with the dismantling of colonial empire but has continued via the current age of imperialist extraction. Unfair trade policies, extractive global supply chains and high indebtedness in part due to the failure of development lending schemes aimed at spurring sustainable growth, continue to take more money out of the global south than given to them as aid.

The process of aid itself is not entirely motivated by altruistic aims either. Powerful countries view aid as a carrot to entice poorer countries to do their bidding. Significant amounts of US aid poured into countries like Egypt and Pakistan was impelled by the pursuit of strategic goals rather than due to the demonstrated ability or desire of the rulers in these countries to channel aid to those most in need. Often authoritarian and unrepresentative regimes can manage to secure aid if they have strategic relevance, whereas many deserving countries, with little strategic value, still have a tough time getting desperately needed aid.

Then comes the question of how aid is administered. Often, aid comes with strings attached. Bilateral aid, and loans, provided on concessional terms by institutions such as IMF and World Bank require poorer countries to pry open their economies to multinational corporations and to implement other economic liberalisation policies. Unfortunately, economic liberalisation does not automatically assure growth, it can also enable the already haves...

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