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AGTI Annual Conference Galway October 2011
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After 60 years of aid, there are almost one billion people hungry in today’s world…... "Government-to-government transfers are an excellent method of transferring money from poor people in rich countries to rich people in poor countries." Peter Bauer - British academic “It seems as if America needs hungry Africans to eat their surplus.” Quote by an Ethiopian farmer
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More than $100 billion is transferred to the South every year in official aid and through private charities. However, remittances account for more than twice as much as all official aid. Sub-Saharan Africa – the world’s poorest region – receives the largest amount of aid of any region – approx $52 per year per capita. Sub-Saharan Africa – the world’s poorest region – receives the largest amount of aid of any region – approx $52 per year per capita.
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Aid to South-East Asia and the Pacific is about $4 per capita per year. Some African countries are very dependent on aid. For instance, aid to Liberia and Burundi equals about half of their GDP. After several decades of receiving aid, Africans are poorer than ever!
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Aid is a partnership between donor countries and recipient countries. Aid is an industry today. Aid has been in operation since the middle of the 20 th century.
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Official aid Bilateral aid Multi-lateral aid Emergency aid Voluntary aid - NGOs Short Term vs. Long Term aid
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(A) The USA insisted that Africa’s governments purchase anti-AIDS drugs from the USA instead of buying cheaper generic products from South Africa, India or Brazil. (B) In Vietnam, a €2.3 million tied aid package from Italy is funding the building of the water system in an urban setting. An Italian company is setting up the Vietnamese flood monitoring system at a cost of €2.5 million.
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Only six countries – Ireland, Luxembourg, the Netherlands, Sweden Norway and the UK – provide more or less 100% untied aid. Tied aid was made illegal in the UK with the International Development Act of 2001.
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Aid makes people lazy It makes recipient governments lazy – they do not pursue tax revenues Aid fuels corruption It discourages enterprise
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Public services that governments should provide are provided by aid agencies Aid dependence becomes an addiction Outsiders call the shots.
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Cold turkey Inward direct investment A market economy
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Aid must be targeted at real needs. Aid must be targeted at real needs. Aid Recipients must be accountable to donors. donors.
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OTHER PRIORITY COUNTRIES: Sierra Leone Liberia South Africa Palestine OTHER PARTNER COUNTRIES: Vietnam East Timor IRELAND’S PARTNER COUNTRIES
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ODA - %age of GNP
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Ireland - ODA in €m
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Africa in 1960: A bright future China in 1960: A basket case Africa today: A continent in crisis China today: ……….Double digit growth
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Tied Aid Dependence Food Aid
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