[Peace-discuss] and that's not counting military "aid" ...

[Ricky Baldwin]

Most International Aid Wasted, Say Agencies 
2-28-05
By Jeremy Lovell 

LONDON (Reuters) - Red tape, inefficiency and nepotism
mean that only one fifth of international aid actually
gets to the people who need it, aid agencies said
Monday. 

Not only that, but 40 percent of international aid is
spent buying overpriced goods and services from the
donors' own countries, Action Aid and Oxfam said in a
joint report calling for urgent reform of a
politically compromised system. 

"First and foremost, they need to spend aid where it
is needed -- on poverty reduction -- rather than
channel it to their own consultancy and infrastructure
industries and geopolitical allies," the report said. 

It accused the United States and Italy of being the
worst culprits in so-called aid "round tripping,"
spending some 70 percent of their aid on their own
companies. 

"This is the ultimate form of round tripping -- taking
with one hand what is given with the other while
advertising your 'generosity,"' it said, noting that
the inefficiency involved inflated procurement costs
by some $7 billion a year. 

The report "Millstone or Milestone" also accused the
international institutions of imposing impossible
conditions on recipient nations and of tying the whole
process up in a bureaucratic quagmire. 

The report noted that in 2003 Senegal had to play host
to 50 delegations from the World Bank. 

It said the existing international aid system had
grown out of the Cold War when donor countries
frequently used aid to obtain political leverage and
fly the national flag. 

"Byzantine donor procedures and conditions have
distorted incentives and systems in aid-dependent
countries and undermined local capacity, hindering
with one hand what they have helped with the other,"
the report said. 

Aid was still often misdirected at high profile
projects or aimed at "donor darling" countries like
Nicaragua which received aid equivalent to $178 per
head in 2001 compared with Niger which got just $22 a
head despite a similar income level. 

"Donors tend to be more concerned about the success
and visibility of their project or program than the
success of a country's development plan," it said. 

The report complained that donor nations often
bypassed local delivery networks thereby undermining
them and leaving countries less able to stand on their
own feet. 

All aid should be untied, technical expertise should
be trained locally, goods and services should where
possible be procured locally and the focus should be
on directly helping the poor and building local
skills. 

"These are major challenges to the aid system since
they imply a redistribution of power between
recipients and donors and a far greater openness and
accountability than currently exists," the report
concluded. 


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