The foreign aid trap, other issues

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xternal aid has become a huge industry and if recipients are not careful, they often get trapped in meaningless debt traps. These traps stop countries from realising their potential.

These fears are genuinely founded. Those that run the foreign aid industry know it well. Their realisation is sometimes reflected in simple things such as semantics.

For instance, changing the word “aid” to “partnership” while all parameters remain the same. For instance, the parameters often include: this is what you should do because you don’t need what you think is right.

The truth is still there. Billions of it have been poured into the country since in 1964. It is also true that some billions that were poured since 1964 never came or left the country even though the books may show the contrary.

This is how the foreign aid industry works and how it traps most countries into poverty and perpetual mercy of a complicated aid industry. It is akin to “debt trafficking” if you like. The traffickers corner you to the extent that you don’t have any choice left.

But truth be told. We all have to grow up some day. There are consequences for failing to grow. Growth is sometimes a matter of choice and recognising that the landscape is not the same. After all, we do not operate in a vacuum. There are different types of growth. Biological growth cannot be suppressed. It is an act of nature for which there is no cure.

Living things die. It is that simple. But growth in terms of making your own decisions about life is a different matter. While the narrative is foreign aid, there is a common enemy to foreign and locally-generated resources. Corruption. It comes in different forms. From theft to deliberate actions that ensure that a chunk of aid goes back to its origin. We can distinguish litigable corruption and moral corruption.

Perhaps local solutions are the best to the extent that foreign aid should be a mere supplement. Think of huge corporations and track their history.

Amazon, started from a house garage and has risen to become the icon of e-commerce. Facebook was an idea crafted in college dormitories and has matured to an enviable multi-billion dollar company.

From a nation point view, I can say that nations also make choices. They can choose to grow or remain the same way.

The wave of industrialisation that started around the 1770’s in England and spread across the Western world is a living experience. The strides made over the years in Eastern Asia are a modern version of industrialisation and the thick skin that comes with making such choices. Why were all these miracles possible?

It is not easy to explain all these things. On the contrary, we can as well think of business or institutions that once thrived. How many do you know that are now part of the history of corporate failure? There are many of them.

Similarly, today we still have many countries that have been stuck in poverty and appear destined to do so for centuries to come.

On the African continent, two countries, Zambia and Ghana have graduated   into middle-income country status. One is land-locked while the other is not. Both are peaceful countries.

Their new status does not mean poverty and deprivation is gone. Their story gives hope to many, including us that it is possible to get the economics right.

Rising higher on development ranking has many benefits. While attracting investment or capital is a complex thing, it becomes easier if a nation is perceived to have a good proportion of its citizens earning a decent income.

Its consumption behaviour and pattern plays well into the growth. Reflecting on the coming budget and the few that we have had, I am no wiser. I reckon to think that those calling the shots get a “dermatologist” just to check how thick our skin has become since the aid freeze fell upon the nation.

The tag of that comes with being the least developed or poorest no matter how the semantics interplay is utmost demeaning. It is unpalatable thing to say, but understandable as well. The factors leading to an aid freeze are well documented.

Stories of wasted aid and the taxpayer making refunds are too normal. This is the hard part but otherwise the aid freeze must remain a turning point for the nation to grow and determine its destination. Growing is a matter of choice.

Foreign aid, no matter its trappings of short-term boost to foreign reserves shall never be the appropriate tool for getting us ahead. The foreign aid industry is as complex as its “clients”. The technical assistance money that we pay nationals of giving country is just bait that entangles us to chronic dependence made complex with our next meal mentality.

As we look forward to the new budget cycle, there many talking points. My first take is taking stock of how thick and creative we are becoming to manage our public finances with minimal external support. At the same I am interested to see how the headlines that sacred off our external support are history.

It appears public finances can be used anyhow by anybody. I am really keen to see how our work ethic is revamped and our psyche rebooted to get all of us appreciate the “holiness” of public funds in national development. The thick skin can develop and actually give us more leverage to determine the foreign aid agenda while not making it an obsession. n