Senior Lecturer and Academic Director of the Master in Public Policy Management, Dr. Robert Mudida presented a paper entitled ‘The African Continent and Development Aid: Does it work?’ during a conference of the International Catholic Legislators Network (ICLN) in Frascati, Italy between August 29th and September 1st 2013.
The ICLN is a platform for Catholic Law makers to share ideas, experience and information as well as the gathering of like-minded people.
In this paper, Dr. Mudida challenges many of the arguments put forward in Dambisa Moyo’s book, Dead Aid, which argues that aid has not worked in Africa and that millions of Africans are actually poorer because of it. Dr. Mudida on the other hand argues that the causality is not as direct as claimed by Moyo. Poverty and development are multi-dimensional concepts and arise from many sources.
African countries have been poor in spite of aid, rather than because of it, Dr. Mudida stated. A lot of Moyo’s evidence is based on several decades of post-independence realities in Africa some of which was characterized by extremely unfavorable Cold War dynamics. Dr. Mudida argues that a lot has changed in Africa since the turn of the century to undermine Moyo’s thesis that aid in Africa does not work. Institutions, both economic and political have improved a lot in recent years, in many African states. Indeed, many African states now have democracies of varying shades and six of the fastest growing economies in the world between 2001 – 2010 were African: Angola, Nigeria, Ethiopia, Chad, Mozambique and Rwanda.
In addition, Africa now has a fast growing middle class. According to the World Bank, about 60 million Africans have an income of 3,000 dollars per year and 100 million will in 2015. Despite the global financial crisis of 2007 – 2009, the economies of Sub-Saharan African grew at an average rate of 4.7% per year between 2000 and 2011. More critically, poverty has declined substantially in many African states.
Dr. Mudida further argues that it is clear that development aid can play an important role in enhancing Africa’s development. Numerous development projects that have transformed millions of lives have been carried out in many African countries over the last decades. Development aid has worked better where African countries have had good institutions. A critical lesson is that aid is necessary but not sufficient for economic development.
A critical principle for aid to be more effective is that it should aim to enhance the common good of the society where it is applied and development assistance needs to have a strong country specific dimension. A one-size-fits-all approach cannot work.
This article is from: Strathmore Business School
Romert Mudida is a Nonresident Fellow at the Navarra Center for International Development and Senior lecturer at Strathmore Business School and has considerable lecturing experience in the areas of economics, financial management, international finance and general management. He holds a doctorate from the University of Nairobi. Dr. Mudida possesses an MSc in Financial Economics from the University of London, School of Oriental and African Studies and an MA in international studies from the University of Nairobi.