Development aid has long been recognized as crucial to help poor developing nations grow out of poverty. There are numerous forms of aid, from humanitarian emergency assistance, to food aid, military assistance, etc.
In 1970, the world’s rich countries agreed to give 0.7% of their GNI (Gross National Income) as official international development aid, annually. Since that time, despite billions given each year, rich nations have rarely met their actual promised targets. For example, the US is often the largest donor in dollar terms, but ranks amongst the lowest in terms of meeting the stated 0.7% target.
Furthermore, aid has often come with a price of its own for the developing nations:
- Aid is often wasted on conditions that the recipient must use overpriced goods and services from donor countries
- Most aid does not actually go to the poorest who would need it the most
- Aid amounts are dwarfed by rich country protectionism that denies market access for poor country products, while rich nations use aid as a lever to open poor country markets to their products
- Large projects or massive grand strategies often fail to help the vulnerable as money can often be embezzled away.