...U.S. Foreign Aid in Developing Countries Over the past 40 years, the United States (U.S.), via the coordination of the Agency for International Development (AID), has provided several developing nations with billions of dollars in aid. Assistance is distributed within the following categories: bilateral development, economic assistance supporting U.S. political and security goals, humanitarian, multilateral economic contributions, military, the Millennium Challenge Corporation, and the Global AIDS Initiative. With so many great programs that offer economic and military assistance, my goal is to determine if any metrics have shown a positive impact within developing nations. Why does the United States give foreign aid? Idealists view foreign aid as a contemporary form of Rudyard Kipling’s ‘White Man’s Burden” whose goal was to uplift those worse off than ourselves out of poverty. The White Man’s Burden by Rudyard Kipling “…Take up the White Man's burden-- The savage wars of peace-- Fill full the mouth of Famine, And bid the sickness cease; And when your goal is nearest (The end for others sought) Watch sloth and heathen folly Bring all your hope to naught.….” While Kipling may have been optimistic, reality shows that foreign aid is a necessity. Foreign aid goals include 1) security by fighting terrorism in the United States and abroad, (2) a financial gain by promoting exports, and (3) humanitarianism. Metrics have not provided a true depiction of the...
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...development of less developed countries It can be argued that debt has become the main obstacle of less economically or in general terms less developed countries to actually develop. However, debt alone cannot be the reason why countries have not developed there many things that need to be taken into consideration such as aid being misspent by governments, war and natural disasters. These are just some of the reasons that are the cause of countries not being able to develop alongside debt. It is apparent that debt is a reason for a nation not developing but not exactly the main reason as there are many factors to consider. However, it is one of the reasons and this is apparent as countries borrow from places such as the IMF and World Bank to trigger development, which in a lot of countries does not happen and these funds are not used to necessarily benefit the people of the developing countries. The aims for governments in developing countries should be try to eradicate or decrease poverty, build infrastructure to trigger development, improve healthcare and education. Although, these are the desired aims for the people in these LEDCs the country gets itself in more problems when it borrows money as they become a country in borrowing culture. For example, countries like Ethiopia who are in debt, which is inevitable that they will never be able to pay as 90% of their income is result of aid and borrowing. Borrowing may be high because of a disaster prone country like Ethiopia who experience...
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...national and household level is a major priority for most developing countries, both for the welfare of the poor as well as for political stability. In order to help assure food security, developing country governments have adopted various strategies including efforts to increase production (often with an explicit goal of food self-sufficiency), government intervention in markets, and public distribution of food and maintenance of national food security stocks. Food aid, both for short-term emergency relief and program food aid, that helps address medium-term food “deficits”, is often a major component of these food security strategies. This essay therefore is going to define the concept of food aid and explain its impact on the development efforts of developing countries drawing practical examples from Zambian experience. It will first start by defining key terms which are food aid, development and the impact of food aid will be looked into and lastly a conclusion will be drawn from the discussion Food aid, is defined by Maxwell (1982) as external help from foreign governments or originating from a donor country, while Young (1992) views it as “all food supported interventions aimed at improving the food security of people living in poverty in the short and long term, whether funded via international, national, public or private resources. The purpose of Food Aid is to promote food security of developing countries. This is accomplished by the provision of food or cash for...
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...AIDS AND PROSTITUTION Fighting AIDS in developing countries is not a lost battle! For years, prostitution has been a major theme in discussions about the global AIDS problem. The media often run stories about AIDS that focus on sex workers (individuals who sell sex), and governments and HIV related organizations, frequently talk about prostitution in the context of AIDS. Of course these are related problems because one is the main cause of the other. This epidemic is bigger in developing countries, but it all exist in Europe or U.S.. The biggest difference between both sides of the Equator is the culture which influences the way to face this problem. It is assured that there are other issues which influence it, such as money, education and governments. However, all of them drift from culture countries. Developing countries are faced with a prostitution problem bigger than developed countries. Actually, in developing countries children are sold by their families to bordellos where they are forced to have sex without protection. This is leading to a high probably to be infected by AIDS. On a “TIME” article (Nepal´s lost daughters, “India soiled goods” by Dhruba Adhikary, Katmandu and Maseeh Rahman) we can read a lot of this examples told by people who lived this tragedies. All of them were infected by this disease and all of them were a lot of troubles when return to their families or birthplace because people reject them. They are called by “India´s soiled goods” and...
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...definition of foreign aid comes from the Development Assistance Committee (DAC) of the Organization for Economic Cooperation and Development (OECD), which defines Foreign aid (or the equivalent term, foreign assistance) as financial flows, technical assistance, and commodities that are; (1) Designed to promote economic development and welfare as their main objective (thus excluding aid for military or other non-development purposes); and (2) Are provided as either grants or subsidized loans. Grants and subsidized loans are referred to as concessional financing, whereas loans that carry market or near-market terms (and therefore are not foreign aid) are non-concessional financing. According to the Development Assistance Committee (DAC), a loan counts as aid if it has a “grant element” of 25 percent or more, meaning that the present value of the loan must be at least 25 percent below the present value of a comparable loan at market interest rates (usually assumed by the DAC rather arbitrarily to be 10 percent with no grace period). Thus, the grant element is zero for a loan carrying a 10 percent interest rate, 100 percent for an outright grant, and something in-between for other loans. The Development Assistance Committee (DAC) classifies aid flows into three broad categories. Official Development Assistance (ODA) is the largest, consisting of aid provided by donor governments to low and middle income countries. Official Assistance (OA) is aid provided by governments...
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...Foreign Aid in Somalia Rachel Gardner Professor Marco Mena Sociology of Developing Countries Strayer University 5/4/2014 The Effects of War and Peace on Foreign Aid Foreign aid plays a major role in the sustainability of economic and social activities of developing nations. Whether in the form of development or humanitarian aid, the foreign aid is key to ensuring better living conditions and economic development for these states. These forms of aid are influential in pushing for progress in among the developing nations, but the presence of war greatly affects progress. War has a bearing impact on the distribution of foreign aid in the developing nations due to the resulting impediments that hinder effective movements of the aid to the intended population. One such country is Somalia that has for decades faced civil war due to the lack of a stable government. The effect of the war is eminent; starving population, poor infrastructure, disease outbreaks and mass displacements of the country’s citizens into refugee camps. However, the country has also received large amounts of foreign aid to assist it in addressing its current troubles, but due the continued prevalence of war in the country no substantial gain has been witnessed. Judging from countries facing similar conditions, it becomes apparent that key is vital for the effectiveness of foreign aid failure to which no significant development can occur. Peace is a key factor in effective distribution of foreign aid. Most...
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...effectiveness of foreign Aid, measures of Aid effectiveness and donors development policy objectives. 2.1. Effectiveness of Foreign Aid The success or failure of foreign aid in developing countries has won a wide range of attention and exhibited a huge controversy. The whole work and accompanying results of foreign aid effectiveness vs economic growth has become a “political football” Easterly and Levine (2003) . The direct impact of aid or its contribution along other factors (Aid_ saving, Aid_ investment, Aid_ productivity, Aid _ Trade) to growth has been described as...
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...The usefulness of foreign aid is often measured in terms of its capability to motivate economic growth, but it has turn out to be more and more clear that economic growth is largely unaffected by foreign aid investments in developing countries due to mismanagement and corruption. This claim is supported by the uncountable observed studies that have influence failures of foreign aid support to developing countries. Money from rich countries has trapped many developing nations in a cycle of corruption, slower economic growth and poverty. Nima, is one of the largest slums in Africa. This suburb of Accra, the capital of Ghana, is home to more than one million people, who make a living in an area of about one square mile. By my estimate, the place is roughly 70% the size of Washington DC South East area. The place is a sea of aluminum, stagnant water breeding mosquitos, and cardboard shacks that forgotten families call home. The idea of a slum raises an image of children playing amidst piles of garbage, with no running water and the rank, and common disgusting odor of sewage. Do developing countries really need foreign aid? What is incredibly disappointing is the fact that just a few yards from Nima stands the Presidential Castle, the Osu Castle, which points out that leaders of the country are aware of the ongoing situation but have not done much to help. Nima embitters in Ghana, a country that has one of the highest ratios of development workers per capita in Africa should...
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...| Pharmaceutical companies | Research Paper | | Daren Smith | 5/21/2012 | | Abstract There is a lot of discussion about pharmaceutical companies, intellectual property, and the global AIDS epidemic. Do pharmaceutical companies have a responsibility to distribute drugs for free or low cost in developing countries? Why is intellectual property such a big deal? What impact would South Africa’s decision to levy duties on drugs in the country have on the international distribution of drugs? Was the change that provided patent protection for pharmaceutical companies an appropriate change or a dangerous precedent? Was it necessary to relax intellectual property rules in order to ensure that adequate supplies of AIDs medications would be available for distribution in the developing world? What role to multi-national corporations have in providing funding or other assistance to international organizations such as the Global Fund? All these questions have many arguments for and against but the right answers probably lie somewhere in between. Having and providing access to affordable medication is one of the greatest challenges we face in today’s world. Many people see that pharmaceutical companies are irresponsible. The evidence is in the high prices individuals have to pay for medications. Although I don’t care for higher priced medications I do believe in the right for a business, or individual, to make money. To come up with medications it takes...
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...Introduction: Foreign Aid any capital inflow or other assistance given to a country which would not generally have been provided by natural market forces. In Bangladesh, foreign aid serves to bridge the gap between savings and investments and make up the deficits in the balance of payments. Foreign aid is a major means of financing the country's economic development. Economic literature generally classifies foreign aid into four main types. First, the long-term loans are usually repayable by the recipient country in foreign currency over ten or twenty years. Secondly, the soft loans repayable in local currency or in foreign currency but over a much longer period and with very low interest rates. The softest are the straight grants often given to the less developed countries. Sale of surplus products to a country in return for payment in the country's local currency is the third type and finally, the technical assistance given to the developing countries comprises the fourth type of foreign aid. Foreign aid is more like an investment in a risky market situation. The relative weighting of advantages and disadvantages depends on the planning behind the foreign aid and how well-orchestrated it is. Economic advantages: stimulated economic development in the receiver's country (better infrastructure, more education etc.) leads to economic growth. It can also create jobs as increased investment leads to more employment; this means less needs to be spent on unemployment benefits...
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...support to developing countries by governments, international organizations, non-governmental organization (NGOs), and groups. Foreign aid was subject to many changes since the end of the Second World War. The developed countries, especially the ones from the Organization for Economic Cooperation and Development (OECD), have started to allocate their ODA through two main channels: the bilateral aid channel and the multilateral aid channel. According to the OECD , bilateral aid “represents flows from official (government) sources directly to official sources in the recipient country” while multilateral aid “represents...
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...International Aid International aid also known as overseas aid & foreign aid. The definition of it makes it seem simple but it is far from it. “It is the voluntary transfer of resources from one country to another with the intention of benefiting the receiving country.” I had heard the term “Aid” in the past but never really had fully understood its true meaning. So during this project I wanted to find out its true meaning and how it affects the receiving country. This can be sent as a signal of diplomatic approach, or strengthen a military ally, to reward a government for behavior observed by the deemed to be deserved by the donor, it’s also to extend an already existent cultural influence & to provide much needed infrastructure. Obviously people have lots of individual reasons for sending aid to others less fortunate than themselves but two stick out these are “Humanitarianism” & also “Altruism”. Aid is so widespread that that it can be given by individuals, private organizations & governments. Depending on personal definitions of the term loans may be or not be counted as Aid. The History of Aid: Nobody can argue that aid has been present since time began. This was mainly from western countries to the rest of the world In the nineteenth & early twentieth century’s the amount of aid was minute in comparison to what it has become in today’s times, these consisted mostly of occasional humanitarian crisis relief. Aid became a major activity at the end of the Second World...
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...reasons to suggest that debt has become the main obstacle to the underdeveloped countries, Rostow believes that for development to work, countries need to go through a certain process. Rostow argues that development should be seen as an evolutionary process in which countries progress ladder of five stages, stage one being at the bottom, i.e. societies which rely on subsidence farming and stage five being at the ultimate stage of development. However there are many countries which are not progressing naturally up this ladder of development, Item A tells us ‘all this was beyond the financial capacity of such countries and as a result a mountain of debt was built up as they were encouraged to catch up with the West’. This could be giving us the idea that in fact, these countries are being pushed into ‘catching up with the west’ getting themselves into debt which they can’t pay back, which is preventing them from moving their way up the ladder. This is the case for many countries with the exception to Tiger countries, many of these underdeveloped countries are remaining at stage one; this essay will assess the possible reasons for this lack of development. Many sociologists will suggest that the lack of development is because of the increase of debt. In 1980, the developing world owed the West $600 billion; however, by 1998 this had increased to $2.2 trillion. This is showing how much the developing world really was in debt. There are numerous reasons dependency theorists argue...
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...Discussion International Inequality Trade verses Aid Culture Clash Trade Liberalization 5 8 13 18 3 Conclusion 21 Bibliography Appendix 23 26 Lucas 3 Does Globalization Cause Inequity Among Rich and Poor Nations? Introduction Globalization and international trade have been around for millennia. Over the most part of the past century, nations have increased the amount of trade that crosses international borders. As trade agreements are made between countries, one nation’s resources become available to another nation’s citizens. The resources in each country are limited and scarce. The differences and availability of the proportions of each nation’s input factors of production is the catalyst for trade (Pugel, 2004). These factors include land, labor, capital, and enterprise. Land is the real estate that is comprised within the country’s border. It contains the natural resources that are limited in nature, such as oil, gold, silver, coal, etc. It also includes resources that can be grown on the land such as timber and agricultural products, which are limited by the size of the land that is available to grow such products and technology. Labor includes the skill sets of a nation’s people and is limited by the population size. Labor can be divided in to skilled and unskilled. In some countries, it may be typical to work a 40-hour week; in others thirty-five may be more of the average. The larger the population size, the more a country can produce and consume. The health of the...
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...of foreign aid on both economic growth and development in India by using Ordinary Least Square (OLS) test from the period 1975-76 to 2009-10. The study analyzes plan-wise distribution and composition of foreign aid inflows into India. It attempts to explain the effect of some major macroeconomic variables on both economic growth and development in India. The results indicate that foreign aid has been considered as a significant determining factor for both economic growth and development of India. The simple OLS test results show that the impact of foreign aid on both economic growth and development is positive. Finally, the study concludes that the impact of foreign aid on economic growth is higher than its impact on economic development, which indicates that aid contributes to growth but that growth is not translated into meaningful development. This inadequate transformation may be caused due to underutilization of foreign aid, inequality present in the distribution of wealth and income, poor economic policies, poverty and corruption. INTRODUCTION Foreign aid is considered as an important ingredient for financing the developmental programs of the developing countries. Currently, it is considered as an important instrument of the foreign policy of states. It acts as a major source of foreign exchange earnings for developing countries. After World War II, developed economies have been providing hundred billions of dollars in terms of foreign aid to the developing world with...
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