At least 20% of the aid money countries claim they are giving to developing countries never leaves, according to new research.
Researchers at the Bristol-based group Development Initiatives estimate that at least $22bn (£13.7bn) of the $100bn-plus reported by donors in 2011 was never transferred to developing countries.
“Large headline figures are presented as if aid is entirely a cash lump sum passed directly from donor to recipient,” added the researchers. “[But] aid is a bundle of different things. Some of it is money. Some is food and other goods. Some is people: the costs of consultants and staff providing technical advice and training.”
Countries report their aid spending annually to the Organisation for Economic Co-operation and Development (OECD) in Paris, though their submissions are rarely subjected to rigorous independent scrutiny.
The researchers found that while Italy reported giving about $2bn in bilateral (country-to-country) aid in 2011, less than $300m was transferred to developing countries.
In contrast, Denmark, which also reported giving about $2bn in aid, transferred roughly $1.85bn to developing countries in the form of cash grants, loans, project support or technical advice.
Less than 70% of French aid – and less than 50% of Austrian aid – was transferred to developing countries in 2011.
At least 8% of British bilateral aid was not transferred to developing countries – a relatively low proportion compared with other donors.
The report doesn’t examine which companies or consultants win contracts for technical advice or other projects, which means the real figures on how much aid stays in donor countries could be significantly higher.
Last year, the Sunday Telegraph revealed just how lucrative the UK aid business has been for a small group of primarily British consultants.
Aid statistics therefore fail to reflect the resources that developing countries receive, the report argues, making it difficult for poor countries to understand exactly how much money is coming in from donors.
Researchers found, for example,
“that more than $5bn of aid supposedly given to the Democratic Republic of Congo in 2011 was never transferred to the country. Instead, most of this figure represented debt relief.”
So where does it go?
The real problem is that aid is actually rising but much of it never reaches poor countries and, when it does, it causes economic, social and political damage.
Almost 50% of donor aid fails to target poverty, but instead aims to meet other donor priorities.
In the UK almost £500million was paid in 2011 to consultants, many of whom earn six, even seven-figure incomes, courtesy of the donors.
- £6million was paid to the University of Cape Town to investigate mental health issues in southern Africa and millions of pounds to US-based organisations, including the Clinton Foundation, the International Food Policy Research Institute and Family Health Inter-national.
- It is paying a Washington-based group, Search for Common Ground, £3.9million to “support the electoral cycle in Sierra Leone”. Consultancy firms in India and Uganda are also receiving large sums.
- More than £20million last year was spent on hotels for these consultants, including many five-star ones.
(The abuse of power for Personal gain)
Corruption comes in many forms through the various AID programmes starting with the Customs Offices of the recipient country and then filters down the system, which, results in some instances no AID actually being received for the original recipients.
- Corruption manifests at three different levels. These include:
- Petty corruption where small favours are exchanged between small groups of people. This level of corruption is rampant in developing countries where civil servants are poorly paid. These people will exchange small gifts just to obtain some small favours.
- Grand corruption, which occurs at the highest levels of government. This form of corruption necessitates considerable insurrection of the economic, legal and political systems. This is the sort of corruption that precipitated the significant cutting of foreign aid in Uganda. It is characterised with despotic governments and those without strong anti-corruption agencies.
- Also known as endemic corruption, systematic corruption occurs due to the failing of the system. Corruption can occur in the different economic sectors, both public and private, and even in non-governmental organisations (NGOs) as these are not immune to it. Corruption in the public sector occurring in the legislative (political), executive (police) and the judiciary systems is considerably dangerous as it affects public service delivery.
This is just scratching the surface of the problems of giving AID to people that are most in need, seems that the politicians and others in the so called developed countries like to play with the figures saying how wonderful they are.
There is obviously no accountability and/or transparency from either the Donors or the recipients.
Most research has shown that there is plenty of smoke and mirrors to mask the fact that the well intentioned donations are being siphoned off into the pockets of the people who least need it and away from the people who most need it.
antonymallinson 