Levels of development differ across the world. Some countries are considered highly developed, whilst others, are significantly less so. These countries that are less developed often need support economically, politically socially, and even environmentally, in the form of development aid. But what exactly is development aid? What agencies are responsible for providing it? Are there different types of development aid? Read on to find out more.
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Jetzt kostenlos anmeldenLevels of development differ across the world. Some countries are considered highly developed, whilst others, are significantly less so. These countries that are less developed often need support economically, politically socially, and even environmentally, in the form of development aid. But what exactly is development aid? What agencies are responsible for providing it? Are there different types of development aid? Read on to find out more.
The idea of aid can be understood as providing help to those that need it. Combine that with development, and we have development aid. But what exactly is the definition of development aid?
Development aid is aid designated to a developing country to support its economic, political, social, and environmental development.
This is also known as overseas aid or official development assistance (ODA).
Development aid can be provided by different agencies. Let's example a few of these.
1. Non-governmental organisations (NGOs): Non-profit organisations are independent of a government, typically focussing on social and economic issues.
These include development charities such as Oxfam and Hand in Hand for aid and development. These organisations will distribute humanitarian aid, reconstruct infrastructure and implement sustainable livelihood programs. For instance, in Syria, these organisations provide essential goods and services such as clean water and clothes.
2. Intergovernmental organisations (IGOs): Organisations made up of two or more sovereign states working together through formal and legal arrangements such as a treaty.
United Nations: UN agencies respond to a lot of emergencies with short-term humanitarian aid. The World Bank arranges loans to developing countries to pursue capital projects and assist economic growth and development.
3. Governments of developed countries: This includes the UK government, the first G7 country that made it mandatory to pledge 0.7% of its GNI annually to development aid. This figure of 0.7% derives from the UN General Assembly in 1970.
There are different types of development aid. Development aid can be either bilateral or multilateral. Let's split these up.
This is when aid is given from developed countries to developing countries directly without intermediate agencies.
This can also be known as “tied” aid as the country receiving aid may have conditions attached, usually trade-related, such as being obliged to buy their good or services in return. Donor countries may prefer this as it gives more control over where the financial aid goes and encourages long-term trade relationships with recipient countries.
Some developing countries refuse this kind of conditional aid as they consider it neocolonialism.
This is aid from multiple donor countries, which will go to an intermediate agency or an IGO such as the World Bank, which will administer the money to the developing country.
The developing country may prefer this because the intermediate is less likely to be pursuing their own political interests, meaning fewer ties and conditions for the country receiving aid. In addition to this, IGOs will be able to pool resources, increasing cost-effectivity, especially for larger projects.
Aid from IGOs, NGOs, and governments will often go to humanitarian emergencies as short-term aid.
The UN responds to many short-term humanitarian emergencies such as natural disasters, for instance, Cyclone Batsirai, which hit Madagascar in February 2022. The most recent figures show the cyclone to have left 124,000 homes damaged or destroyed and 30,000 more displaced1. It has killed 120 people in Madagascar, all while the country is still struggling to overcome the previous cyclone and has been battling food shortages from a severe drought. The World Food Programme, part of the UN, has been working with the government as a response, providing hot meals. UNICEF and UNFPA, both also UN agencies, have been providing protection with emergency accommodation sites for the displaced as well as essential medicines and healthcare equipment.
The EU was also able to act fast with a team of 5 EU Civil Protection experts from across Europe, trained in coordinating emergencies and solving humanitarian logistics, water and sanitation, and health problems.
“UN and NGOs have landed in Madagascar to support relief efforts, thanks to the European Union, which has facilitated the necessary humanitarian air bridge” - UN spokesperson2
To get top marks in an essay, apply a case study outside of conventional textbooks to prove your contextual knowledge and application skills. Remember to meet your assessment objectives, [AO2: Apply knowledge and understanding in different contexts to interpret, analyse and evaluate geographical information and issues]
For an example of a development aid project, we're going to take a look at Haiti.
Background: Haiti is an island in the Caribbean Sea and is at risk of multiple natural hazards, mainly earthquakes and hurricanes. Its relatively poor population and low HDI, ranking 163 out of 188, gives Haiti the nickname of “the republic of NGOs”. The Haitian earthquake in 2010, which killed over 220,000, led NGOs, IGOs, and governments across the world to respond with aid.
NGOs:
We can think about development aid economics through the idea of trade. One method of donor countries giving aid is through trade, or, “aid for trade”. This bilateral aid will promote diplomatic relations between the two countries to trade their goods and services, which will open the developing country to advance their economies. A lot of low-income countries will lack the infrastructure and ability to compete in a global market. Having access to this market can allow the country to import and export goods and services, consequently encouraging more manufacturing, innovation, employment, and even potentially establishing comparative advantages. All of this ultimately allows the country to improve its economic resources and develop a better quality of life for its citizens.
Comparative advantage: This is the country’s ability to produce a specific good or service at a lower opportunity cost than any competitor. This will usually make the country the largest exporter of that specific good or service.
The World Trade Organisation (WTO) helps developing countries to trade globally through:
Uganda: 48% of the country’s development aid from 2006 to 2013 was from ‘aid for trade’, the WTO initiative. The country’s exports rose by 144% and its commercial services rose by 362%.
Yes, foreign aid can promote economic growth through schemes such as 'aid for trade'. Investments into trade will give the country access to the global market allowing it to import and export goods and services. This will consequently encourage more manufacturing, innovation and employment. This isn't the only way of improving its economic resources as loans and grants for specific projects can do this too, ultimately almost always developing the country's economy as long as the aid isn't held back with corruption. However its extent of success can be up for question depending on the project and external interests.
This agency and agencies similar to USAID, will provide aid to authorities and will also distribute relief packages accordingly as short term aid. However, as government agencies, USAID will also spread their own political interests attached to their provision such as advancing democracy. Other aid agencies may do the same unless they are NGOs.
International aid is aid, typically given as money, designated to a developing country to support their economic, political, social and environmental development. This development in low income countries is vital in reaching goals such eradicating poverty and ending world hunger.
Schemes such as 'aid for trade' will bring investments into a developing country that will teach a country how to operate in a global free market, which can accelerate economic growth and stability. This will be done as goods and services will now be imported and exported subsequently encouraging more manufacturing, innovation and employment. Through optimising and improving economic resources in a country, it will also improve other development indicators such as literacy rates and infant mortality.
As development aid improves the low income countries' human development, poverty will drop along with world hunger and a multitude of social issues such as minors working in dangerous conditions. These are part of the UN MDGs which countries across the world are committed to achieving.
What is development aid?
Aid designated to a developing country to support their economic, political, social and environmental development.
Name two types of development aid.
Bilateral and multilateral
What is the difference between multilateral and bilateral aid?
Multilateral aid goes through an intermediate agent, which pools resources and administers the aid to the developing country themselves. Bilateral aid is administered by the donor country.
Name the main advantage of multilateral aid?
It can pool resources which allow for bigger and more cost-effective projects.
Name two disadvantages of bilateral aid.
The aid is subject to the donor country's conditions, which the receiving country is obliged to meet.
As the aid is typically given government to government, the money can be held back in corruption.
Who gives development aid?
All of them
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