Reducing The DG: Aid Strategies

Question 1

Top-down

Answer 1

Capital intensive and often government led. ODA supports this. It has been criticised as being an inappropriate way of helping poor countries. Aid given to governments is fought over by different interests groups at the cost of investment in productive business activities, and the money is more likely to be diverted to rich people, rather than benefitting the poor. So ODA creates winners and losers.

Question 2

Typical aid ‘winners’

Answer 2

Urban areas, topical issues such as AIDS, areas of political interest, areas of historic ties between the donor country such as colonial ties, major disaster areas, countries using aid to support their country system.

Question 3

Typical aid ‘losers’

Answer 3

Rural areas and smaller scale projects that rely on NGOs, recipients of tied aid, development programmes whose funds have to be diverted elsewhere, countries with corrupt governments, countries dependent on long term aid.

Question 4

Bottom up

Answer 4

Local approach, NGOs often work well at local scale in collaboration with local communities.

Question 5

Forms of aid

Answer 5

Largely in the form of loans - they attract interest and have to be repaid, they can easily spiral into debt crisis. Developing countries need capital, but technical assistance in the form of expertise, technology and education can be more useful is supporting development. The links between developed and developing in the context of aid can lead to dependency.

Question 6

Official development aid

Answer 6

OECD nations are committed to provide a certain level of development assistance to developing nations, this is either given as bilateral aid or multilateral. It is given to support the economic, social and political development in developing countries.