WASHINGTON (AP) — The number of
countries that use foreign aid
efficiently has increased dramatically
this decade even as the level of help
from wealthy nations has dropped to a
50-year low, the World Bank said
recently.
In a report entitled “Assessing Aid: What Works, What Doesn’t And
Why,” World Bank economists argue that aid works best as a combination
of money and ideas.
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“Aid is more than just money; it is about ideas or knowledge creation,”
said Joseph Stiglitz, the bank’s chief economist who presented the
report. “It’s helping communities find what works for them and getting
people the services they need whether it’s primary education or clean
water supplies … Properly managed foreign aid can make a big
contribution.”
Stiglitz said that with more developing countries moving to sound
policies and donors promoting reform and institution-building in these
nations, there never has been a better time for giving aid.
“The bad news is that just as aid is poised to be its most effective,
the volume of aid is declining and is at its lowest level” since the end
of World War II, Stiglitz said. In the 1990s, the report said, foreign
aid has declined from $69 billion to $48 billion last year.
At times, foreign aid has been a spectacular success — in Korea in the
1960s, Indonesia in the 1970s, Bolivia and Ghana in the 1980s and Uganda
and Vietnam in the 1990s, the report said. But there also have been
unqualified failures — decades of foreign assistance to a corrupt
dictator in Zaire that disappeared without a trace or a $2 billion worth
of roads in Tanzania that deteriorated for lack of maintenance.
“Foreign aid has thus been highly effective, totally ineffective and
everything in between,” the report said.
