IIPM BBA MBA Institute: Student Notice Board
Business of global aid
The World Bank acknowledges that “during the Cold War years, aid was politically motivated.” Surprisingly, in spite of being the world's second largest economy, China gets more than $2.5 billion a year as foreign aid. What is more surprising is that even as recently as 2007-08, a more needy nation like Ethiopia got merely $1.6 billion, while Iraq got $9.462 billion and Afghanistan $3.475 billion.
Aid is clearly used for political favour. Most of the time, developmental aid is given to countries for ally formation and buying votes in forums like the UN Security Council. As per a paper by Kuziemko and Werker, US foreign aid increases when countries serve on the UNSC. Ten temporary members of the UNSC were more likely to receive IMF assistance [than others]. Being frontrunners in such moves, America’s primary purpose of economic assistance has always been to promote US policy objectives. According to Hans Joachim Morgenthau (leading international politics expert), “The transfer of money and services from one government to another performs the function of a price paid for political services rendered or to be rendered.”
With so much developmental and humanitarian aid coming in from various nations, rampant duplication of work is reducing the effectiveness and efficiency of the whole concept. According to a UN investigation report, around 50 per cent of the UN World Food Programme in Somalia has been stolen. A large pie out of $2.5 billion relief fund for Haiti was siphoned off by locals as well as UN officials. As per Gerbert van der Aa, a historian and noted journalist, out of the total money that Netherlands donates as humanitarian aid, only 33 per cent is effectively used while another 33 per cent simply fails to reach [the beneficiary]; and there is no clear evidence whether the remaining 33 per cent is used effectively or not.
Until the US invasion of Iraq and Afghanistan in 2001, Israel and Egypt were the leading recipients of US aid (more than 30 per cent) but after invasion, things got reversed. Among the top 15 recipients of US foreign aid, only four (Afghanistan, Ethiopia, Sudan and Uganda) are among the 'least developed' while none of the world’s poorest countries make it to the list. Strom Thacker of Boston University opines that IMF loans “more often to countries that move toward the US position in UN General Assembly roll-call votes.” According to UNFAO Director-General Jacques Diouf, “Food aid is mostly donated on condition that it should be purchased and processed in and shipped from donor countries, even if adequate supplies are available in the region where it is needed.” Aid is generally disbursed for lobbying, domestic interest or international diplomacy. Foreign aid rarely promotes economic development. Instead, it reduces the urge to adopt innovative technologies to address problems. Rather than pumping aid, the West should relax trade barriers and restrictions, and encourage imports from the developing countries. But that’s a boring premise we’ve been chaffing since ages..
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Business of global aid
The World Bank acknowledges that “during the Cold War years, aid was politically motivated.” Surprisingly, in spite of being the world's second largest economy, China gets more than $2.5 billion a year as foreign aid. What is more surprising is that even as recently as 2007-08, a more needy nation like Ethiopia got merely $1.6 billion, while Iraq got $9.462 billion and Afghanistan $3.475 billion.
Aid is clearly used for political favour. Most of the time, developmental aid is given to countries for ally formation and buying votes in forums like the UN Security Council. As per a paper by Kuziemko and Werker, US foreign aid increases when countries serve on the UNSC. Ten temporary members of the UNSC were more likely to receive IMF assistance [than others]. Being frontrunners in such moves, America’s primary purpose of economic assistance has always been to promote US policy objectives. According to Hans Joachim Morgenthau (leading international politics expert), “The transfer of money and services from one government to another performs the function of a price paid for political services rendered or to be rendered.”
With so much developmental and humanitarian aid coming in from various nations, rampant duplication of work is reducing the effectiveness and efficiency of the whole concept. According to a UN investigation report, around 50 per cent of the UN World Food Programme in Somalia has been stolen. A large pie out of $2.5 billion relief fund for Haiti was siphoned off by locals as well as UN officials. As per Gerbert van der Aa, a historian and noted journalist, out of the total money that Netherlands donates as humanitarian aid, only 33 per cent is effectively used while another 33 per cent simply fails to reach [the beneficiary]; and there is no clear evidence whether the remaining 33 per cent is used effectively or not.
Until the US invasion of Iraq and Afghanistan in 2001, Israel and Egypt were the leading recipients of US aid (more than 30 per cent) but after invasion, things got reversed. Among the top 15 recipients of US foreign aid, only four (Afghanistan, Ethiopia, Sudan and Uganda) are among the 'least developed' while none of the world’s poorest countries make it to the list. Strom Thacker of Boston University opines that IMF loans “more often to countries that move toward the US position in UN General Assembly roll-call votes.” According to UNFAO Director-General Jacques Diouf, “Food aid is mostly donated on condition that it should be purchased and processed in and shipped from donor countries, even if adequate supplies are available in the region where it is needed.” Aid is generally disbursed for lobbying, domestic interest or international diplomacy. Foreign aid rarely promotes economic development. Instead, it reduces the urge to adopt innovative technologies to address problems. Rather than pumping aid, the West should relax trade barriers and restrictions, and encourage imports from the developing countries. But that’s a boring premise we’ve been chaffing since ages..
For More IIPM Info, Visit below mentioned IIPM articles.
Professor Arindam Chaudhuri - A Man For The Society....
GIDF Club of IIPM Lucknow Organizes Blood Donation Camp
IIPM: Indian Institute of Planning and Management
IIPM Marches Ahead in B-School Rankings...
IIPM Prof Rajita Chaudhuri's Snaps
Ragging rights and wrongs
Indian universities and higher education institutes seem to be caught in a time warp teaching things
