Official Development Assistance: a Critical Overview

Whereas 22 developed countries have pledged to contribute a paltry 0.7% of their GDP in form of Official Development Assistance (ODA) to developing countries, after 40 years of the commitment, only five countries have come close to that target. This paper argues that even then, the assistance is provided inefficiently since most of it is spent as unsolicited expensive Technical Assistance or repatriated in form of input purchase conditionalities. The paper also argues that ODA figures are artificially inflated by donors including forgiven debts as new assistance. It traces the recent history of development assistance from the Marshall Plan to the Paris Declaration on Aid Effectiveness. It singles out aid conditionalities as "master-student arrogance". It also criticises endless postponement of deadlines for achieving human development goals as tantamount to goal-shifting. Finally, it concludes that external aid cannot deliver a country from poverty, since the amounts committed are too small, the commitment too little, the donor agendas too many, and argues that only fair trade can contribute meaningfully to lifting the poor in recipient countries to acceptable levels of human development.