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Foreign aid as a deterrent to African economic growth

by Mo Siddiq

Created on: April 21, 2008

When thinking of poverty, many imagine a malnourished child with a bloated stomach sitting on a dusty ground. Often times, this is child staring right at the camera while insects circle his or her body. There is no image of a safari in the child's background. Instead, he is in a broken, unsanitary world that no child should ever be a part of. Moments after this moving is displayed, there is some usually some request for aid. The request appeals to the humanity all of us. We want to help this child, to give him aid. Yet, as reality has shown us, fighting for trade, instead of giving aid, might be the best way we can help him.

Africa's poverty problems took center stage in the second half of the 20th century, after the nations declared their sovereignty from European powers. As the European occupants left, they took with them the structures of a functioning government and economy as well as most all individuals skilled enough to instate a new one. For the African nations, with freedom came the cost of rebuilding, a painful struggle they still face.

The unfortunate series of events that have taken place in Africa since, which include droughts, disease, and genocide, have tarnished the region and evoked global sympathy. Many individuals and nations have sent aid with intentions of providing relief, but these billions of dollars have, at best, been a short-lived solution. The problems facing Africa are ones that must be solved from the inside, and for that to happen, Africa must enter and be a player in the global market.

Trade being a better solution than aid might sound counterintuitive at first. Aid, after all, requires none of the nation's natural resources. However, as African Kimani Wanguhu of Kim Media says, "With aid, it's easy come, easy go." Wanguhu also references a common proverb to put the debate between trade and aid in perspective. "When you break down the analogy of teaching a man to fish versus giving him a fish, you'll see something," Wanguhu says. "Teaching him to fish is similar to doing trade, but giving him a fish is closer to aid."

This proverb is a perfect reference point when comparing the pros and cons of trade and aid. Like giving a man a fish, aid gives instant relief and often reduces or eliminates budget deficits. Nonetheless, the cause of the problems remains unsolved, and the same problems return the next day. While dependent on aid from others, countries become less self-sufficient and the nation's existing economy becomes undermined.

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