AUS DEM SPIEGEL
Ausgabe 27/2005

Too Much of a Good Thing: Choking on Aid Money in Africa

By Erich Wiedemann and Thilo Thielke

Ahead of this week's G8 conference in Scotland, the world's richest nations forgave billions in debt to the world's poorest. Great news, right? Not necessarily. Decades of Western aid have done little to ease suffering in Africa -- indeed the situation is worse than ever. Is it time for the West to rethink its aid strategy?

Ethiopia is often a victim of severe draught.
AP

Ethiopia is often a victim of severe draught.

The aid workers are thirsty and the beer is flowing: There is a party mood in Rumbak, the city of tents which at one time almost became the capital of Southern Sudan. It's is a bit like the end of the day atmosphere at a trade fair: The stands have closed down and people have knocked off work.

All over the place people in sandals and washed-out T-shirts emblazoned with meaningful slogans ("no cattle plague -- more milk") and where they are stationed ("Somalia, Uganda, Sudan"), dart down side streets. The aid organizations' colored pennants flutter in the hot evening wind.

Several times a day local people heave heavy crates out of the rickety old planes which have just landed. Obscure airlines use these planes, before they are sent to the scrap yard, to turn a fast buck. Rumbak, which until recently was a God-forsaken hole, is now booming.

After over 20 years of civil war between the North and the South in Sudan, a peace agreement has now been reached. In April it was decided in Oslo that Sudan would be granted $4.5 billion in reconstruction aid. A decision which, although greeted joyfully by many people, is viewed with skepticism by Norway's minister for development aid, Hilde Frafjord Johnson: "Much more aid has been agreed on than I think we actually need."

This sudden wealth is a cause for concern even among the aid workers themselves. "If we carry on like this," says Lammart Zwaagstra, who comes from the Netherlands and works for the EU's department for humanitarian aid, "then people will never stand on their own two feet."

Creating more "need" with generous aid

Rambak threatens to become a bitter example of how development aid doesn't really help. Again and again finance is hurriedly provided for one project after another, without any evidence of a convincing overall concept. The money is just thrown at projects as quickly as possible. In this case, Norway has made $500,000 available for just 500 refugees in the camps. The windfall immediately sparked off further need and a second camp, this time home to 345 people, has sprung up. It is the Italians who are footing the bill for the new camp.

The flow of money to Africa.
DER SPIEGEL

The flow of money to Africa.

Money is, for the Europeans, the solution to all of Africa's problems. But despite yearly payments of, at last count, some $26 billion, the majority of the continent resembles something approaching one big emergency military hospital.

Already today there are increasing numbers of Africans who call for an end to this sort of support. They believe that it simply benefits a paternalistic economy, supports corruption, weakens trade and places Africans into the degrading position of having to accept charity. "Just stop this terrible aid," says the Kenyan economic expert James Shikwati.

The suffering is overwhelming: More than 300 million people south of the Sahara have to survive on less than a dollar a day. This figure has gone up by around 100 million over the last 10 years alone. Two thirds of the poorest countries in the world are in Africa, as are 34 of the 35 states with the lowest life expectancy. The UN's development expert Jeffrey D. Sachs has written that sickness plagues Africa like a "silent tsunami" surging over the continent every day.

It is impossible to develop prosperity in states which are falling apart. Only 1 percent of the world's wealth is created in the region between the Sahara and the Cape of Good Hope, despite the fact that this area is home to 11 percent of the globe's population. And without the gold and diamond mines of South Africa and the oil and gas reserves of Nigeria, this figure would be less than half a percent. Forty-two of the 52 states in Africa have either slim, or even no, recognizable opportunities for development. According to Jean Ziegler, a developmental sociologist from Geneva, Africa is like a "raft at sea at night." It is drifting away and is slowly vanishing off the Western world's radar.

Rock music for the world's poor

Now a rather unusual band of rescuers has decided to help the shipwrecked continent. The ageing rock star Bob Geldof has woken the world up with his Live8 concerts in a series of cities, including Rome, Paris, Berlin, London and Philadelphia. By listening live to Elton John, Paul McCartney, Eric Clapton and a reunited Pink Floyd, hundreds of thousands of people, as well as the tens of millions who watch the concert on television, are demanding that their politicians stick to their promises and save Africa. The motto of the music festival, which has been embraced by millions of people, is "the long march to justice."

The timing for the world-wide mobilization to combat the African tragedy has been well chosen. Four days after the concerts, the leaders of the world's most important industrialized nations will meet in the Scottish golf resort of Gleneagles, near Edinburgh, in order to make a decision on new aid for Africa. Geldof wants to send them an army of demonstrators.

Even before the summit has begun, the G8 nations have already decided to alleviate the debts which 18 of the world's poorest countries -- 14 of which are in Africa -- have accumulated with the World Bank, the International Monetary Fund and the African Development Bank. Instead of having to pay the interest on the debt, $40 billion will be now be available for education, health and support for local businesses.

Tony Blair, the summit's host, has the ambitious aim of doubling, even tripling, development aid for Africa south of the Sahara. Yet even the debt relief is an admission of how much traditional development policy has failed. It shows that despite the massive sums of money which have flowed into Africa, it has not been possible to make much progress in the fight against poverty.

Between 1970 and 2002 the countries south of the Sahara received a total of $294 billion in loans. In the same period of time they paid back $268 billion, and accumulated, after interest, a mountain of debt amounting to $210 billion. Why is it that the billions, which both the West and the East poured into Africa during the Cold War, have been so useless? The suspicion is hard to avoid that aid, sometimes, paralyzes.

Corruption, selfishness and greed

Basically it is always the same reasons why development aid in Africa tends to disappear down a black hole: incompetent planning of the donor nations, which means that aid is always distributed according to the wrong priorities, as well as a combination of corruption, selfishness, greed and arbitrary use of government power in the recipient countries themselves.

Aids is just one of the many difficulties facing Africa.
AFP

Aids is just one of the many difficulties facing Africa.

Often, what started out so promising ends up as a fiasco. Hendrik Hempel, who works for the German Society for Technical Cooperation (GTZ), helped renovate a state-owned farm in North Eritrea after the war with Ethiopia. For years he literally created a blooming landscape.

But Hempel's case became a silent indictment of the incompetence of the ruling government party. He managed to get better yields than the state-run farms. But despite his success, he was forced to give up when the government suddenly installed hundreds of former freedom fighters, who had been left without work after a number of state-run farms had gone bust, as paid employees in his business.

Industrialization and trade, research and development have brought unparalleled levels of prosperity to more sections of society than ever before, first in Europe, and then in the USA. Asia is also making steady progress. The only continent which is falling more and more behind is Africa. And as a result of the dramatic increase in the exchange of goods, data and services, Africa has been left hanging completely.

Apart from South Africa and the West African oil states, most countries on the continent export almost only raw materials, which are notorious for bringing low returns on international markets. These countries barely participate in the sale of services and manufactured goods in international competition.

What is known as the "terms of trade" -- the difference in price between goods which are imported and those which are exported -- have worsened dramatically in large parts of Africa. At the beginning of the 1980s a coffee farmer had to produce 50 sacks of coffee beans in order to buy a tractor. By the end of the 90s this figure had jumped to 140 sacks. And the gap looks set to widen still further.

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DER SPIEGEL 27/2005
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