Dismiss Blair’s committee on aid

Efforts are made by some of the governments of richer countries to ease the burden of poverty through aid, but much of this help is poorly directed, used to further strategic interests and, very often, is simply a cover for getting round international trade agreements against subsidising inefficient national industries.

The United States, for example, pours billions of US dollars every year into Israel with Egypt coming a decent second and most of the rest of the world almost nowhere. The G8 poverty alleviation scheme announced with so much fanfare last year seems to have benefited Nigeria and Iraq the most, with the rest of the world receiving remarkably little.

And a lot of the aid given turns out to be aid in kind designed to support a pampered industry at home. A country will, to keep a bad car-maker afloat, buy thousands of vehicles and give them away. Spain and Britain have both been guilty of this. The EU has been known to wipe out Third World agricultural industries by dumping its surpluses, bought at vast expense from its over-protected and coddled farmers. Major arms producers will, to fiddle their own defence accounts, order extra weapons and give these away, the development costs of a new plane or tank thus being paid for from the aid budget, rather than the defence budget.

Even in such fundamental areas as health, many aid givers pay more attention to their own constituencies than to the real needs of Third World children. For example, vast sums are now being given to buy anti-retrovirals to keep HIV+ alive. This cannot be condemned, but the financial winners are the Western drug companies who make the stuff. Research into a vaccine to prevent HIV infection is negligible, with the largest single contributor being a trust set up by Bill Gates. And while he is the world’s richest man, his wealth is trivial when compared to even a small developed country like, say, Belgium, let alone his own USA.

And yet some aid is well spent and there are people in the First World who know, at least know far more than their political leaders, what is required.

Unicef has, for 20 years, been one of the best spenders of aid money. This once Cinderella of the UN system has saved the lives of tens of millions of poor children simply by ensuring that every child can be vaccinated against many common infections, that mothers can monitor their children’s growth and parents know how to deal with runny tummies. There is nothing dramatic about this, and oral rehydration therapy does not boost profits of First World chemical companies or sell tickets to rock concerts. But it works.

Others, often sneered at as a lunatic fringe, realise that the smartest way to help poor people in poor countries is to pay a fair price for the crops they grow or the things they make. If a small coffee grower can get the world price for his beans, rather than see all the profit going to some Western multinational, he and his family do not need aid. They can pay their own way. He can send his children to a reasonable school, buy them books and food and could even pay for their vaccinations if it came to that.

But far too much of the debate on global trade is dominated by the political servants of these major multinationals and, to give Western governments their due as political realists, the millions of First World voters they employ. But to try and elevate base self-interest as something ethical is a bit rich.

So Third World countries are told to open their economies, buy fancy goodies from the West without restriction but are not paid a decent price for what they are allowed to export and are forbidden to export quite a few things they do make rather well. And just to sugar this bitter medicine, the Third World will be tossed well under one percent of the profits made by these Western multinationals. That is not much sugar for such bitter medicine.

What is so surprising though, is that the long term self-interest of the West will be best served by proper trade. Those poor countries, poor farmers and struggling industrialists will spend the extra money they make through decent trade; they are not going to bury it in the ground. And Western companies will obviously be among those who make money, although not the same ones who at the moment are allowed to milk the poor.

We hope that Mr Blair’s little monitoring committee or high-profile names to check on aid progress will be dismissed, and instead those who actually know what is going on will at last be allowed to have a voice so that the extremely modest aid budgets of the rich are actually spent on helping poor people become better off, better educated and healthy.

July 2006
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