|
| |
|
| |
| Aid or Trade? Bernard Otabil Argues that Africa Needs to be Helped to Help Itself West Africa, 23rd- 31st March 2002 The division of opinion as to whether Africa needs to receive more aid or do more to boost trade is confusing, writes Bernard Obtail. The debate has been intensified by the ongoing discussions at Monterrey, Mexico, on the International Conference on Financing for Development. Oxfam, in Last Chance in Monterrey: Meeting the Challenge of Poverty Reduction, have criticized some western governments for emphasizing 'trade not aid' on the grounds that firstly, rich countries have failed to open up their markets to poor countries and secondly, increased aid is vital for the world's poorest countries if they are to grasp the opportunities provided through trade'. Which is the easier option to pursue, trade or aid? The Oxfam paper point out that 10 years ago donors pledged to spend 0.7% of their GNP on aid. This did not happen; instead, budgets were cut, on average to 0.22% of GDP. Per capita aid to sub-Saharan Africa fell from $34 per head to $20 per head in the second half of the 1990s. It is difficult to persuade western Governments to increase aid; hence, why do we continue to push this argument? Rather, we should promote trade more firmly. Rich countries may pledge but pledges often go unfulfilled; trade has many more options for developing counties. We are all aware of problems of market access for developing countries, of the numerous barriers they face with their products. But the World Trade Organization (WTO) has achieved some successes for developing countries. It is perhaps the only organization where small countries have won debates with big countries. By promoting trade, developing countries can take advantage of other trade agreements, like the USA's Africa Growth and Opportunity Act (AGOGA) that gives increased market access to many Africa, Caribbean and Pacific countries. Yet the truth is that some developing countries in the past have signed up to trade agreements that they were not available to deliver on. Technical assistance is needed. If African countries streamline their trade strategies with other mainstream objectives like reducing inflation, strong macro-economic performance, controlling interests rates and other fiscal policies, then indeed the benefits of trade could be strongly experienced and the arguments about the respective benefits of aid and trade would end. Yet this has not been the case. In their attempt to adopt quick fixes, some countries in Africa have relied heavily on aid. In some cases the aid flows have created imbalances, served as a beacon for corruption and looting and created more hardships for the people. There is no doubt that some aid is needed, but there is also a need for African countries to reflect on how they fight poverty and hunger and achieve growth. African governments will never get a Marshall Plan type of aid from the west; so why should they place so much emphasis on something which tends to destroy them? Campaigners should help Africans to help themselves. |
