Aid

Aid (or "international aid", "overseas aid", or "foreign aid", especially in the United States) is the help, mostly economic, which may be provided to communities or countries in the event of a humanitarian crisis or to achieve a socioeconomic objective. Humanitarian aid is therefore primarily used for emergency relief, while development aid aims to create long-term sustainable economic growth. Wealthier countries typically provide aid to economically developing countries.

Sources and distribution

Bilateral Aid is given by the government of one country directly to another. Many dedicated governmental aid agencies dispense bilateral aid, for example USAID, and DFID.

Multilateral aid is given from the government of a country to an international agency, such as the World Bank, the International Monetary Fund, or the European Development Fund. These organizations are usually governed by the contributing countries.

Donations from private individuals and for-profit companies are another significant type of aid. The practice of giving such donations, especially on the part of wealthy individuals, is known as philanthropy. Many immigrants move to areas of increased economic opportunity, and send money to friends and family members who still live in the countries they left. These payments are known as remittances (rather than philanthropy) and constitute a significant portion of international monetary transfers.

Non-governmental organizations (NGOs) play a major role in distributing aid - examples include ActionAid, Oxfam, and the Mercy Corps. Many non-profit charitable organizations solicit donations from the public to support their work; charitable foundations often oversee an endowment which they invest and use the proceeds to support aid organizations and other causes. Aid organizations may provide both humanitarian and development aid, or specialize in one or the other. A number of aid NGOs have an affiliation with a religious denomination.

Many NGOs conduct their own international operations - distributing food and water, building pipelines and homes, teaching, providing health care, lending money, etc. Some government aid agencies also conduct direct operations, but there are also many contracts with or grants to NGOs who actually provide the desired aid.

Scholarships to foreign students, whether from a government or a private school or university, might also be considered a type of development aid.

Types of aid

(The use of the term "given" in this section is potentially misleading. Almost all aid from multilateral donors (e.g. World Bank) is in the form of loans.)

Project aid: Aid is given for a specific purpose e.g. building materials for a new school.
Programme aid: Aid is given for a specific sector e.g. funding of the education sector of a country.
Budget support: A form of Programme Aid that is directly channelled into the financial system of the recipient country.
Sectorwide Approaches (SWAPs): A combination of Project aid and Programme aid/Budget Support e.g. support for the education sector in a country will include both funding of education projects (like school buildings) and provide funds to maintain them (like school books).
Food aid: Food is given to countries in urgent need of food supplies, especially if they have just experienced a natural disaster.
Technical assistance: Educated personnel, such as doctors are moved into developing countries to assist with a program of development. Can be both programme and project aid.
Emergency aid: This is given to countries in the event of a natural disaster or human event, like war, and includes basic food supplies, clothing and shelter.

Aid terms related to DAC members

Official Development Assistance (ODA): Aid provided to Part I DAC list of aid recipients developing countries with the clear aim of development.
Official Aid (OD): Aid provided to Part II DAC list of aid recipients. It includes both countries not considered a developing country and contributions to international organizations. (See ODA)
Other Official Flows (OFF): All other official transactions to DAC list of aid recipient countries not covered by the previous two. (See ODA)

Other Terms

Tied aid: Aid that has geographical limitations on where it is used.
Disbursements: Aid that is actually provided, as opposed to the amount promised (commitment).

Humanitarian aid

Humanitarian aid is rapid assistance given to people in immediate distress by individuals, organisations, or governments to relieve suffering, during and after man-made emergencies (like wars) and natural disasters. The term often carries an international connotation, but this is not always the case. It is often distinguished from development aid by being focussed on relieving suffering caused by natural disaster or conflict, rather than removing the root causes of poverty or vulnerability.

The provision of humanitarian aid or humanitarian response consists of the provision of vital services (such as food aid to prevent starvation) by aid agencies, and the provision of funding or in-kind services (like logistics or transport), usually through aid agencies or the government of the affected country. Humanitarian aid is distinguished from humanitarian intervention, which involves armed forces protecting civilians from violent oppression or genocide by state-supported actors.

The Geneva Conventions give a mandate to the International Committee of the Red Cross and other impartial humanitarian organizations to provide assistance and protection of civilians during times of war. The ICRC, has been given a special role by the Geneva Conventions with respect to the visiting and monitoring of prisoners of war.

The United Nations Office for the Coordination of Humanitarian Affairs (OCHA) is mandated to coordinate the international humanitarian response to a natural disaster or complex emergency acting on the basis of the United Nations General Assembly Resolution 46/182.

The Sphere Project handbook, Humanitarian Charter and Minimum Standards in Disaster Response, which was produced by a coalition of leading non-governmental humanitarian agencies, lists the following principles of humanitarian action:

The right to life with dignity.
The distinction between combatant and non-combatants.
The principle of non-refoulement.

Development aid

Development aid is aid given by developed countries to support development in general which can be economic development or social development in developing countries. It is distinguished from humanitarian aid as being aimed at alleviating poverty in the long term, rather than alleviating suffering in the short term.

The term "development aid" is often used to refer specifically to Official Development Assistance (ODA), which is aid given by governments on certain concessional terms, usually as simple donations. It is given by governments through individual countries' international aid agencies and through multilateral institutions such as the World Bank, and by individuals through development charities such as ActionAid, Caritas, Care International or Oxfam.

The offer to give development aid has to be understood in the context of the Cold War. The speech in which Harry Truman announced the foundation of NATO is also a fundamental document of development policy. "In addition, we will provide military advice and equipment to free nations which will cooperate with us in the maintenance of peace and security. Fourth, we must embark on a bold new program for making the benefits of our scientific advances and industrial progress available for the improvement and growth of underdeveloped areas. More than half the people of the world are living in conditions approaching misery. Their food is inadequate. They are victims of disease. Their economic life is primitive and stagnant. Their poverty is a handicap and a threat both to them and to more prosperous areas. For the first time in history, humanity possesses the knowledge and skill to relieve the suffering of these people."

Development aid wanted to offer technical solutions to social problems without altering basic social structures. Wherever even moderate changes in these social structures were undertaken, e.g. the land reforms in Guatemala in the early 1950s, the United States usually forcefully opposed these changes.

Criticism

The economist William Easterly and others argue that aid can often distort incentives in poor countries in various harmful ways. Aid can also involve inflows of money to poor countries that have some similarities to inflows of money from natural resources that provoke the resource curse. ^[1]^[2]

Many also criticize U.S. Aid in particular for the policy conditionalities that often accompany it. Emergency funds from the International Monetary Fund and World Bank, for instance, are linked to a wide range of free-market policy prescriptions that some argue interfere in a country's sovereignty.

Also in an episode of 20/20 Stossel showed flaws in the distribution of the foreign aid, and the governments of countries receiving aid.

Food given as aid often ended up on markets being sold privately
The government receiving aid often had secret bank accounts in which it hid foreign aid money for private purposes

Notes

^ Lars Schoultz, “U.S. Foreign Policy and Human Rights Violations in Latin America: A Comparative Analysis of Foreign Aid Distributions”, Comparative Politics, Volume 13, Number 2, January 1981 (2 of the graphs from the study can be found here)
^ Martha Knisely Huggins, Political Policing: The United States and Latin America, Duke University Press (July 1998) ISBN 0-8223-2172-6 p. 6

References

Håkan Malmqvist (2000), "Development Aid, Humanitarian Assistance and Emergency Relief", Ministry for Foreign Affairs, Sweden [1]
The White Man's Burden : Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good by William Easterly
Andrew Rogerson with Adrian Hewitt and David Waldenberg (2004), "The International Aid System 2005–2010 Forces For and Against Change", ODI Working Paper 235 [2]
"The US and foreign aid assistance" [3]
Millions Saved A compilation of case studies of successful foreign assistance by the Center for Global Development.
ActionAid, May 2005, "Real Aid" - analysis of the proportion of aid wasted on consultants, tied aid, etc

Cross references

^ Collier, Paul (2005). Is Aid Oil? An analysis of whether Africa can absorb more aid. Centre for the study of African Economies, Oxford University.
^ Djankov, Montalvo, Reynal-Querol (2005). The curse of aid. The World Bank. http://www.econ.upf.edu/docs/papers/downloads/870.pdf

External links

V-Generations Discussion Board: Talk about aid organizations
OECD Development Co-operation Directorate (DAC)
AiDA: Accessible Information on Development Activities
www.realityofaid.org
AidMarket
Aid Harmonization: What Will It Take to Meet the Millennium Development Goals?
US And Foreign Aid Assistance
Euforic makes information on Europe's development cooperation more accessible

[1] Collier, Paul (2005). Is Aid Oil? An analysis of whether Africa can absorb more aid. Centre for the study of African Economies, Oxford University.

[2] Djankov, Montalvo, Reynal-Querol (2005). The curse of aid. The World Bank. http://www.econ.upf.edu/docs/papers/downloads/870.pdf

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Aid