Kenyan Economist: Stop the Foreign Aid!

Sorry, still have not had time to put up vacation photos…time for learnin!

James Shikwati is a Kenyan economist who strongly believes that foreign aid hurts Africa. While the interview goes back to 2005, when Der Spiegel sat down with him he had some pretty good zingers to throw:

Shikwati: Huge bureaucracies are financed (with the aid money), corruption and complacency are promoted, Africans are taught to be beggars and not to be independent. In addition, development aid weakens the local markets everywhere and dampens the spirit of entrepreneurship that we so desperately need. As absurd as it may sound: Development aid is one of the reasons for Africa’s problems. If the West were to cancel these payments, normal Africans wouldn’t even notice. Only the functionaries would be hard hit. Which is why they maintain that the world would stop turning without this development aid.

But his objections to foreign aid aren’t just universal. He has specific hatred for the UN World Food Programme:

Shikwati: … and at some point, this corn ends up in the harbor of Mombasa. A portion of the corn often goes directly into the hands of unscrupulous politicians who then pass it on to their own tribe to boost their next election campaign. Another portion of the shipment ends up on the black market where the corn is dumped at extremely low prices. Local farmers may as well put down their hoes right away; no one can compete with the UN’s World Food Program. And because the farmers go under in the face of this pressure, Kenya would have no reserves to draw on if there actually were a famine next year. It’s a simple but fatal cycle.

I can’t say I entirely disagree with Shikwati. While the idea of simply tossing out the Food Programme is perhaps a bit extreme, it’s true that handouts have some often unaddressed negative effects. On a small scale, I see it every day when people ask me for money because I’m white. On a slightly larger scale, I find that community institutions are disappointed in me–they see westerner, they think money…but as a Peace Corps Volunteer, I have no money to give.

In South Africa, I am continually surprised by the unutilized resources I come across. At my school we have almost everything we need for a full scale science lab, but nobody uses the lab. What we do have was not treated well or kept organized, and the lab fell into disrepair. To clean and reorganize the lab is a big job, and one that needs far more time than money.

Nevertheless, I am continually asked to find money for new equipment and chemicals for the lab. But additional equipment might be bad–it would certainly be swallowed up into the disorganization and just add to the mess. The irony here is that we don’t need monetary resources–we need manpower: the willingness on the part of students, teachers, administrators, and community members to put in the elbow grease to get things going and keep things from falling apart. (I’m hoping that I can provide the initial push to get people involved in upkeep of the lab…stay tuned).

We also have an entire classroom full of books. It’s a complete mess. Some of it is certainly garbage (pre-Apartheid textbooks), but much of it could be used. Nobody is going to touch it. It is simply too intimidating to sort out the mess.

I can’t help but wonder where the idea of money as the solution to problems came from…possibly the idea of handouts as the solution to problems?

Shikwati also touches on a problem I didn’t  realize existed until I got here:

Shikwati: … Jobs with foreign aid organizations are, of course, quite popular, and they can be very selective in choosing the best people. When an aid organization needs a driver, dozens apply for the job. And because it’s unacceptable that the aid worker’s chauffeur only speaks his own tribal language, an applicant is needed who also speaks English fluently — and, ideally, one who is also well mannered. So you end up with some African biochemist driving an aid worker around, distributing European food, and forcing local farmers out of their jobs. That’s just crazy!

This is 100% true. Some of the smartest, most capable, most unbelievable South Africans I’ve met have been…aid workers. Their English is beautiful, they are well organized, and they’re very smart. But then I hear about the things they used to do before they became aid workers…they taught, they ran businesses, they were big contributors to society. They were leaders. And now, they’re second fiddle to often bumbling foreigners because the aid work money is excellent. And as these capable people join the aid work bureaucracy, suddenly the smartest people are working towards keeping the system entrenched. I’m sure this problem is much worse in countries less developed than here, as there are decent jobs available in South Africa compared to much of Africa.

But Shikwati’s most intense criticism is reserved for AIDS. He says some pretty extreme things about the infection rate, which I very much don’t agree with. However, he makes an excellent point about the economics of HIV/AIDS:

Shikwati: AIDS is big business, maybe Africa’s biggest business. There’s nothing else that can generate as much aid money as shocking figures on AIDS. AIDS is a political disease here, and we should be very skeptical.

The money AIDS brings into Africa is staggering. AIDS work has become an industry in itself. Huge parts of the South African government are funded directly with AIDS money. There is a major vested interest in keeping AIDS around. The economic impact of an AIDS cure would probably put tens of thousands of people out of work just in South Africa. While I don’t share Shikwati’s conspiracy vibe, I think it is important for aid workers to recognize that AIDS has become a gigantic industry–probably one of the 10 biggest industries in Africa. If a cure for AIDS appeared tomorrow and all of the aid was withdrawn, parts of Africa could be thrown into economic turmoil.

I think Shikwati goes too far with some of his criticisms, but he makes a point that aid workers have to face, even if it makes us uncomfortable…we need to be aware that what we do has tremendous side effects, and we should be spending more time and energy focusing on minimizing these unintended side effects of our presence.


>Pete Micek says:

The concept of food sovereignty (within the rubric of food security) addresses the problem of dumping free food into developing nations. In one example, Haiti saw a glut of rice from aid groups and local farmers cannot compete. The US is perhaps the worst offender, sourcing very little of the food they deliver from the nation or region they deliver it to. Other European countries are much better at buying from local or regional producers. I imagine our corn lobby has something to do with our intransigence. It also doesn’t help that Cuba is one of the main proponents of food sovereignty. Also, the UN HR Council’s Special Rapporteur on the right to food, Olivier De Schutter, is a supporter of smallholder agriculture. My colleague in our school’s HR clinic worked on this topic. SEe

30 Aug 11 @ 9pm

michaelwsherman says:

Pete, can you that link? It’s crazy huge!

31 Aug 11 @ 12pm

Pete Micek says:

Here you go Mike:

Sometimes my links are longer than most people’s, sorry.

07 Sep 11 @ 4pm