Premium Essay

The Impact of Foreign Aid in Kenya

In: Social Issues

Submitted By dayzee
Words 10863
Pages 44
SID 1223384

A PROPOSAL TO EVALUATE THE IMPACT THAT FOREIGN AID HAS HAD ON DEVELOPMENT IN KENYA

RESEARCH STUDIES MOD001774 SHIRLEY JONES

SID 1223384

FACULTY OF HEALTH, SOCIAL CARE AND EDUCATION 2012/13

1

SID 1223384

ABSTRACT The aim of this study is to evaluate the impact of foreign aid on development in Kenya. The study will investigate the effect that foreign aid has had on development, appraising its benefits as well as exposing its shortcomings. Judging from the level of aid that the developing world receives and the economic development that takes place in third world countries, there appears to be an inverse relationship between aid and development. With this continuing debate, my interest of study has been to find out foreign aid’s impact to development in Kenya as it is dependent of aid but poverty still seems impossibility in the country for many decades. Therefore, the study will seek to expose these pitfalls of foreign assistance to a nation’s growth and development, using the Kenyan example to illustrate this relationship. The prevailing research methodology shall be of a qualitative positivist nature. Debates still exist around foreign aid dependency and economic development in the “Third World” countries as despite the input from developed countries there hasn’t been much change witnessed in the developing nations which are still drowning in poverty since 1960’s. The study will highlight on the demerit of excess foreign aid has development whereby the more dependent a state is on donors, the lower the development in that state. INTRODUCTION Context of the Research Question Development assistance also known as foreign aid is offered by developed countries to their less developed counterparts to aid in political, social, economic and environmental growths. Foreign aid commenced in post-World War II as an instrument for reconstruction...

Similar Documents

Free Essay

Foreign Policy

...Growth and development of foreign policy Name Institution Date There have been vast changes and developments in the foreign policy agenda that have seen Kenya as a country, transition through many regimes that had their individual differences since independence. Since the attainment of independence, Kenya has had fairly smooth international and regional relations that have been ensured by the various statutes and values put in place to make sure that Kenya grows in all dimensions, economically, socially, politically plus other aspects that are cupped under the bigger ones mentioned above. In the current global space we are in today that is so competitive and complex, strategies have to be put up that promote the many interests of Kenya. It should be noted that since independence Kenya has had four sitting presidents including the current one, this has a close relationship of the way the foreign policy agenda has revolutionized. It will be noted that since independence Kenya had quiet diplomacy that can be considered to have been of a low profile approach in terms of foreign affairs especially international ones. In this immediate post-independence period there was active involvement in regional peace diplomacy. The architectures of these polices then had the central idea that the future of the country strongly stood on the belief that regional stability and security in our environment is the basis for national prosperity and survival. Therefore, there was need to......

Words: 2005 - Pages: 9

Premium Essay

Research Proposal

...UNIVERSITY OF NAIROBI INSTITUTE OF DIPLOMACY AND INTERNATIONAL STUDIES Implications of Global International Monetary Policy Decision on Economic Systems in East Africa: A Case Study of Kenya NAME: LILLIAN WACHIRA REG NO: R50/63875/2010 Supervisor: Dr. Gerrishon Ikiara A Research Proposal submitted in partial fulfillment of the Degree of Masters of Arts in International Studies (MA IS) DECLARATION I declare that this research proposal is my original work and has not been presented for a degree in any other university. NAME: LILLIAN WACHIRA REG. NO: R50/63875/2010 Sign: ………………………………… Date: ……………………… This research proposal has been submitted for examination with my approval as university supervisor SUPERVISOR: Sign: ……………………………… Date: …………………………. DEDICATION I dedicate my project to my lovely mother Beatrice, my brothers Edwin and Eric whose prayers words of encouragement and push for tenacity ring in my ears. ACKNOWLEDGEMENT I would like to express my sincere gratitude to my supervisor Dr. Gerrsihon Ikiara for the continuous support and guidance while carrying out my project, for his patience, motivation and immense knowledge. I would also like to thank the participants in my survey, who have willingly shared their precious time during the process of interviewing. ......

Words: 24867 - Pages: 100

Free Essay

Ethics

...not regret it. Every year, the region reports a tremendous number of tourists who visit the area especially during the holidays. The warm coastal climate makes it favorable for many whites who have winter in their country. Vacation for them is well spent in such a nice and relaxing climate. As the tourist come, they bring along changes to the city. Many are the changes indeed and they come as positive and negative .We shall first start looking at the positive ones. One of the ways in which a country gains a world-wide name is by tourism. If foreigners go to Mombasa and they like what they find there, they return to their countries with good news of what they have seen. The number of visitors to the city will therefore end up growing since everyone will want to go and see how good the place really is. As the number grows so does the profit grow. Tourist will not only bring a good name to the city but they will also bring growth to the economy of the place as a result of increased profit. After all has been said and done and the visitors have come, gone and later said what good they have seen, awareness is created and appreciation developed for Mombasa . Although tourism itself can disrupt or destroy ecosystems and environments, tourism can also be the very reason for conserving an unspoiled landscape otherwise susceptible to industrial development. This is so because, many of the animal park and the game reserves have been well maintained by the government because...

Words: 2807 - Pages: 12

Premium Essay

Mister

...Introduction East Africa has long been a major supplier in the international flower market. Most of Europe’s roses are imported from East Africa nations. The United States Aid program (USAID) has declared a plan to expand the flower exports in Africa. However, given the potential disadvantages related to economic, social and environmental sustainability, criticisms believe that the USAID should take a careful consideration about this proposal, before it implemented. Rationale Proponents of the proposal point out that export expansion in the flower industry has the real capacity to deliver both economic and social benefits to East African nations and their nationals. Olpacle (2009) cites the case in Kenya that the flower industry has contributed to $300 million for its foreign exchange earnings. Meanwhile, the flower farms in Kenya has created 40,000 job opportunities for local workers. In terms of environmental impacts, Whelau (2009) points to that compared with a Dutch hothouse, raising equivalent number of roses in Kenya produced much less amount of CO2. Objections Opponents of the proposal argue that expanding flower exports in East Africa may exacerbate human rights abuse and create community dependence on the flower industry. Research revealed that cut flower workers are often forced to endure unfair wages, Sh 70 a day for 8 to 12-hour workday, crowed housing and dangerous working conditions (Majtouyi, 2002). Furthermore, Bloomfield (2006) points to the......

Words: 497 - Pages: 2

Free Essay

Tanzania Uganda Kenya

...production facility outside of the United States to produce a variety of consumer products, in Tanzania, Uganda, and Kenya. We plan to: * Pointedly expand into the Tanzanian, Ugandan and Kenyan markets to improve profit margins and increase local market share. * Construct a factory in a high potential region * Expand global reach and decrease costs of production in a new facility in these markets. Introduction: Lewis Globalworks Co. Inc. is a producer of a variety of consumer products. Such products include textiles, computers, and auto parts. The company has successfully operated in the United States for the past ten years. With the business boom that is occurring domestically and the desire to improve overall profit margins, the company is planning to build a production facility somewhere outside the U.S. in an attempt to produce at a lower cost. This plan will lay out our goals and tasks to make this potential transition successful and create a profitable outfit. In this write up five major areas of concern will be addressed. These areas are Economic, Cultural, Political, Technological and Legal. All five areas will have significant impact on a decision to build a facility in one of three areas. Our goal is to provide you with an overview of the current environment related to the five areas of concern, in the countries of Tanzania, Uganda, and Kenya. All three countries are located on the eastern coast of Africa and exhibit similar characteristics, with......

Words: 2409 - Pages: 10

Premium Essay

University in the Box

...BETWEEN CORPORATE GOVERNANCE PRACTICES AND FINANCIAL AND FINANCIAL PERFORMANCE OF INVESTMENT BANKS IN KENYA | NICHOLAS KIPYEGOMEN CHEPKOIWO | FACTORS AFFECTING THE DEVELOPMENT OF EMERGING CAPITAL MARKETS.  THE CASE OF NAIROBI STOCK EXCHANGE | KIPKURUI KIMOSOP | THE RELATIONSHIP BETWEEN CORPORATE GOVERNANCE AND FINANCIAL PERFORMANCE OF INSURANCE COMPANIES IN KENYA | OMENDA CHRISTOPHER ODHIAMBO  | EFFECT OF STOCK SPLITS ON STOCK LIQUIDITY OF COMPANIES QUOTED AT THE NSE | GEORGE MARTIN NZIVE KASYOKA | THE USE OF STRATEGIC POSITIONING TO ACHIEVE SUSTAINABLE COMPETITIVE ADVANTAGE AT SAFARICOM LIMITED | MUTIE PETER KIOKO | RELATIONSHIP BETWEEN PRIOR PERIOD DIVIDENDS AND FINANCIAL PERFORMANCE OF FIRMS LISTED AT THE NSE  | EVANS ODHIAMBO OYIEYO | BALANCE SCORE CARD AS A STRATEGIC MANUFACTURING INDUSTRY IN KENYA | SAMBA STEPHEN MIDEGA | INVESTIGATION OF CAPACITY MANAGEMENT STRATEGIES AND THEIR INFLUENCE ON SERVICE QUALITY: CASE OF NAIROBI SUPERMARKETS. | LUCY MUTHEU KIILU | CAUSES OF INDUSTRIAL DISPUTE IN GARMENT FACTORIES AT THE ATHI RIVER EXPORT PROCESSING ZONES, KENYA | JENIFFER N. MULI | THE RELATIONSHIP BETWEEN HOUSE PRICES AND MORTGAGE CREDIT IN KENYA | LOISE KINYUA WANJIRU | STRATEGIC RESPONSES OF EQUITY BANK TO FRAUD RELATED RISKS | DOMSIANA ANYANGO ONYANGO | THE RELATIONSHIP BETWEEN FINANCIAL PERFORMANCE AND INVESTMENT STRATEGIES OF PENSION FUNDS IN KENYA | MARGARET W. GICHANE | ADOPTION OF SOCIAL MARKETING CONCEPT BY PRIVATE HOSPITALS IN NAIROBI. | ......

Words: 15830 - Pages: 64

Premium Essay

The Effects of War and Peace on Foreign Aid in Somalia

...The Effects of War and Peace on 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......

Words: 1360 - Pages: 6

Premium Essay

Kenya Economy

...OF CONTENTS TABLE OF CONTENTS 2 Introduction: Kenya Economy (Sub-Saharan Africa) 3 Objective of the study 4 Macro Economic Indicator Table 5 GDP Trend 6 Trade and Industrial Policy 9 Exchange rate policy 17 Monetary policy & Fiscal Policy 21 References: 26 Introduction: Kenya Economy (Sub-Saharan Africa) Kenya is considered by many today to be the heartland of East Africa. It has a total area of approximately 580,000 km2, making it slightly smaller than the state of Texas. The country's southeastern border is defined by the Indian Ocean, and its southwestern border includes a small portion of Lake Victoria. Kenya's climate changes from tropical along the coast to arid in the interior. Although Kenya is located on the equator, temperatures of many of its cities are moderate because they were built at high altitudes. The terrain consists of low plains, central highlands, which are separated by the Great Rift Valley, and a fertile plateau. However, as little as 3% of the total land area of the country is arable (able to support a crop). It is the 47th largest country in the world in terms of land area; Major agricultural products in the country are tea, coffee, wheat, sugar cane, dairy products and eggs. Important industries of the country are cement, tourisms, oil refining, and consumer goods. Kenya's economy relies heavily on agriculture and tourism Currency: Kenya shilling. National accounts base year: 2001. SNA......

Words: 5761 - Pages: 24

Free Essay

Middle Childhood

...have argued and defined human trafficking as the removing of any orphan from their culture and placing them in an unrelated different environment. Nevertheless, it is the poor non-educated families from developing or sending nations that suffer the most. Kenya and other nations have been affected by human trafficking in one way or another, while the United State avoids legal responsibility and accountability in such matters. Kenya’s issue is child abduction. This type of human trafficking is increasing around the world. Children are abducted and forced to fight in armies. The majority of the world’s conflict is fought by children. Healy (2008) states: Children are recruited primarily because they are easily to control and indoctrinate…Some are abducted or conscribed by force;…Girls are abducted into armies, some to serve as soldiers, others for sex, and often both(p.96). Bondo district, Kenya is characterized by high levels of poverty, and a HIV prevalence rate (13.7%), which is twice the national average. Under these conditions, the issue of orphanhood becomes extremely relevant. Because of the AID epidemic, one–third of the children have lost one parent, while one out of nine has lost both. This makes the children in Kenya most vulnerable to be abducted. Furthermore, Skovdal (2008) argues that the politicians must use effective language when...

Words: 2198 - Pages: 9

Premium Essay

Financial Liberalisation and Price Stability in Kenya

...Financial Liberalisation and Price Stability in Kenya[1] Anders Isaksson Department of Economics, Göteborg University Box 640 S-405 30, Göteborg, Sweden. Abstract It has been postulated in the literature that attempts to liberalise the financial sector when inflation is high can lead to high interest rates and even higher inflation. Thereafter. when inflation is fought, a period of low inflation and high real interest rates follow. Since Kenya experienced this sequence, it appears that prices were unstable before and during the financial liberalisation. This paper argues that this was not the case as evidenced by cointegration between the involved variables and the abliltv to estimate a stable inflation model over the period 1970-91. When the cointegrating relationship breaks down, which it does in Kenya after the financial liberalisation, economic agents can no longer forecast inflation with confidence using Historical data. This breakdown of the cointegratina vector implies that agents switch to forward-looking behaviour, perhaps an indication of lack of credibility, in the financial liberalisation process. JEL Classification numbers: E31, E44 and O11 Kevwords: Kenya, Price stability, Financial liberalisation, Cointegration, VAR. 1. Introduction As part of its financial-sector reform, Kenya liberalised interest rates between January 1988 and July 1991[2]. Subsequently, market interest rates skyrocketed, while inflation rose even further. When undertaking......

Words: 6159 - Pages: 25

Free Essay

U.S. Foreign Aid in Developing Countries

...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......

Words: 1960 - Pages: 8

Premium Essay

Derivatives and Commercial Banks in Kenya

...TABLE OF CONTENTS DECLARATION ii LIST OF ABBREVIATIONS iii CHAPTER ONE: INTRODUCTION 1 1.1 Background 1 1.1.1 Derivatives 2 1.1.2 Foreign Currency Exposure of a Commercial Bank 3 1.1.3 Effect of derivatives on foreign exchange exposure 5 1.1.4 Commercial Banks in Kenya 6 1.2 Research Problem 7 1.3 Objectives of the Study 8 1.4 Value of the Study 9 CHAPTER TWO: LITERATURE REVIEW 10 2.1 Introduction 10 2.2 Theoretical review 10 2.3 Foreign Exchange Risk Management 13 2.6 Empirical Review 18 2.6 Summary of Literature review 19 CHAPTER THREE: RESEARCH METHODOLOGY 20 3.1 Introduction 20 3.2 Research Design 20 3.3 Study Population 20 3.4 Data Collection Procedures 20 3.5 Data Analysis and Presentation 20 REFERENCES 22 APPENDICES 26 LIST OF ABBREVIATIONS CBK – Central Bank of Kenya ERV - Exchange rate volatility FOREX – Foreign Exchange FX – Foreign Exchange IFE – International Fisher Effect IFX - Income from foreign currencies as a percentage of total income IRP – Interest Rate Parity MST – Market Segmentation Theory NA - Net Assets NFXNA - Net Foreign Currency Exposure Relative to Net Assets NFX - Net Foreign Currency Exposure NSE – Nairobi Securities Exchange OS - Ownership Status or Nature of Ownership PPP – Purchasing Power Parity CHAPTER ONE: INTRODUCTION 1.1 Background The traditional role for commercial banks has been......

Words: 7523 - Pages: 31

Premium Essay

Investing in the New East African Community

...through the World Bank, the African Development Bank Group, African Investment Associations, and numerous periodicals. Specific information on privatizations is available at the Multilateral Investment Guarantee Agency’s PrivatizationLink. Introduction Africa is a dynamic landmass. Home to some of the world’s richest and poorest people in the world, this little explored continent has a unique story and seen a struggling path of development leaving more than 600 million inhabitants living on less than $2 a day PPP. Although much of Africa is, developmentally speaking, several generations behind the United States and other western nations, there is reason to believe that returns from human and physical infrastructure, foreign direct investment, and international aid organizations will set the stage for sustainable high growth opportunities in the future. While the continent as a whole shares in the struggles for development, the size of the landmass is four times that of the US and is by no means a homogenous region. Africa is as diverse economically and culturally as it is expansive. After breaking the continent into regions one still leaves ample room for misleading generalizations. Therefore, it is important to refine data to a particular market to represent economic reality. The focus of this paper is on East Africa. In General, East Africa typically includes over 19 countries...

Words: 3490 - Pages: 14

Premium Essay

Emerging from the Frontier

...the year of 2013 is the turning point for South Africa because of their economic growth. They believe that 2013 is the year of continent becomes a destination of choice for global choice. We have come to know that South Africa’s economies grown very strongly. On the other hand sub-Saharan economies such as Nigeria, Ethiopia, Angola, Ghana, Cote d’ivoire, Kenya, Uganda; while countries of developing world facing economic uncertainty.The economic growth of South Africa is not only by its wealth of natural resources but also by its investments in agriculture and manufacturing. There are lots of opportunities for private sectors now in Africa. As because of Asia’s economies growth is slow and their labor wages rise therefore Africa will become the next preferred destination for labours intensive manufacturing of products such as garments sector. They are attracted by people for their low-cost and light manufacturing though it’s still important to need to work on their humanitarian interventions. Africa will emerge in a respected member of global community in few years. Their new mission will be how to do the work in development aid to attract more private sectors. Suddenly, Africa’s economies changed for their three reasons. First of all, global uncertainty continues to be the norm in 2013, trade and investment flows between Africa and BRIC (BRAZIL, RUSSIA, INDIA, and CHINA). The second reason is Africa promotes stronger economic ties at home (AFRICA). And the third aspect is......

Words: 1793 - Pages: 8

Premium Essay

Fallacy of Taking Development to the People

...American International Journal of Contemporary Research Vol. 4 No. 1; January 2014 Kenya’s Social Development Proposals and Challenges: Review of Kenya Vision 2030 First Medium-Term Plan, 2008-2012 Ezekiel Mbitha Mwenzwa Department of Social Sciences Karatina University P. O. Box 1951, Karatina, Kenya. Joseph Akuma Misati Department of Sociology Maasai Mara University P. O. Box 861 20500, Narok, Kenya. Abstract Kenya faces several development challenges including poverty, disease, unemployment, negative civic engagement among others. The development bottlenecks worsened following the introduction of the IMF/World Bank-propelled Structural Adjustment Programmes (SAPs) of the late 1970s and early 1980s. While the SAPs had envisaged benefits, they largely became part of the problem rather than the solution to development in Kenya. Accompanying these were negative civic engagements, particularly, ethnic conflict and political maladministration especially after the re-introduction of multiparty politics in the early 1990s. These drawbacks notwithstanding, development planning went on culminating in the Economic Recovery Strategy for Wealth and Employment Creation (ERSWEC) 2003-2007 in 2002 and its successor, the Kenya Vision 2030 in 2007. While the former was implemented, the latter is on course with the First Five Year Medium-Term Plan running from 2008 to 2012 recently concluded. The blueprint is driven by three pillars, namely; The economic, social......

Words: 5661 - Pages: 23