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Limited, conditional and generally highly-targeted flows of resources aimed ostensibly at encouraging economic development or alleviating shorter-term crises of social reproduction. An example of the latter was the response to the crisis in South-East Asia during 1997-8 in which the International Monetary Fund (IMF) and various of its member governments intervened to limit the extent of the crisis and to force restructuring, especially of financial systems, within the countries caught up in the crisis. These objectives were widely criticized at the time for attempting to impose anti-inflationary policies on a crisis that required reflation.
Official Development Aid (ODA) is financed largely through contributions from donor governments. Such aid is normally offered on financially discretionary but politically restrictive terms. Aid may also be privately financed through mechanisms such as the increasingly popular microcredit. This usually comprises small loans to small businesses, often charging very high rates of interest to cover the risks of lack of collateral but on temporarily flexible terms which allows for the rapid turn around of the loan. Aid may be arranged on bilateral terms and flow directly between two countries or between specified donors and receivers. Flows of resources (capital, technology, expertise), food, export credits, educational and training scholarships and government-to-government lending may be generated in this way. More widely targeted flows may also move on a multilateral basis from donors to recipients using criteria such as levels of income or specific identifiable problems and crises. Attempts such as those advocated by the United Nations Conference on Trade and Development (UNCT AD) with respect to adverse shifts in terms of trade to offset the deleterious effects of trade relations between developed and underdeveloped economic geographies represent a further form of multilateral aid through the social control of markets.
The origins of the contemporary large-scale flows of aid within the world economic geography lie in the European Recovery Programme of 1948 under which Marshall Aid from the USA was designed to offset balance of payments and liquidity crises in western Europe after the Second World War, thereby sustaining European demand — not least for US products and investments — and subverting the prospect of communist influence in the region. In addition, multilateral agencies may coordinate aid. Such agencies include: semiofficial bodies, such as the World Bank (International Bank for Reconstruction and Development) agencies of the UN; more commercial institutions, like the European Bank for Reconstruction and Development (EBRD) set up to aid the process of social and economic transformation in eastern Europe after the events of 1989; the Inter-American, African and Asian Development Banks along with their development funds; and more spatially and temporally-specific organizations which may involve both public and private sources of funding such as the International Fund for Agricultural Development. Regional programmes of aid are exemplified by the Lomé Conventions of the European Union. In addition, charitable organizations, such as Oxfam, War on Want and Live Aid, also collect and redistribute aid.
In 1996 only Denmark (which donated 1.04 per cent of GNP to ODA), Norway, Sweden and the Netherlands (which each gave around 0.8 per cent of GNP) committed more than the minimum 0.7 per cent of GNP recommended by the United Nations. The average level of contribution from developed countries was 0.22 per cent — the lowest figure since records began and well down on the 0.35 per cent contributed during the early 1980s. The USA committed only 0.08 per cent, down from 0.12 per cent in 1986; a major factor in this decline was that Israel — a major recipient of US aid — is no longer considered to be a developing country. In all low and middle income countries taken together, official development assistance amounted to 3.3 per cent of GNP — a figure which hides the range from 16.3 per cent in sub-Saharan Africa to 0.9 per cent in Europe and Central Asia. Official development assistance accounted for over 100 per cent of Mozambique\'s GNP.
The ideological justification for aid is that it promotes development and so may be justified both in terms of the self-interest of the donors and through its appeal to notions of distributive justice (see, for example, Brandt Commission 1980, 1983: see also justice, geography and) Here there are a number of criteria that might be used to assess the quality of aid: does it reach the most needy and does it contribute to their basic needs?; does it help to promote human rights and democracy?; does it promote sustainable development?; does it enable autonomous development or increase dependence?
But aid is not only limited in amount, it extracts a price which may be met directly — to service interest payments on debt for example — or indirectly in the form of markets for the exports of donors and access to the resources of the receiver. Aid may also facilitate an extension of the donor\'s global economic and strategic influence — in a very direct way in the case of military aid — or purchase the support of sympathetic political regimes or economic policies. In such ways, aid may intensify relations of economic dependence upon the donor economy, shape local elites through educational assistance and, in the case of food aid, disrupt local prices and supply systems. Aid is, in short, a powerful means of spreading and sustaining particular discourses of development and forms of social reproduction.
Arguments such as these have been used by those opposed to aid (e.g. Bauer, 1991). They may be extended to suggest that aid actually creates the Third World in tying recipients more closely into the economic and geographical dynamics of donors as it addresses limited economic problems such as deficiencies in the local availability of savings, or a need to bridge a technology gap, or lack of foreign currency — all arguments which were significant in the case for Marshall Aid — which may more readily and effectively be retrieved by market forces. Such arguments may be bolstered by the observation that the flow of aid is also highly selective. It is directed mainly towards the middle-income rather than towards the poorest countries. Some indication of this selectivity is given in the following data which show the amount in US dollars of aid received per head in various regions of the world:
||| Asia| | 7.2|
| | Americas| | 16.8|
| | Europe| | 26.8|
| | Africa| | 33.3|
| | Oceania| | 269.0|
| |It is difficult to resist the conclusion that the geography of the flow of aid is directed by the economic ability rather than the social need of the recipients and so serves as a means of maintaining and strengthening current relations of political and economic power in the world economic geography .
However, as ever, the geography of development is far more complex than is allowed for in abstract discussions for and against flows of aid. For example, against the Bauerian argument that the historical geographies of the already developed economies were not based on aid — and, by extension therefore, that aid is not a precondition of development — should be counterposed the point that the global economic geographies in which these regions developed were quite different in terms of absolute and relative inequalities in the distribution of economic and political power and institutional control, and that they too relied on a form of aid in the form of the plunder of the worlds \'discovered\' by expansionist European countries (cf. inequality, spatial). An argument pointing to the greater effectiveness of aid and to its justification in terms of social justice has been made by Riddell (1987) whilst David Smith (1998) has begun to address the moral philosophical questions related to the concern — as represented, for example, in the complex motives for aid-giving — for distant others. (RL)
References Bauer, P. 1991: The development frontier essays in applied economics. Hemel Hempstead: Harvester Wheatsheaf. Brandt Commission, 1980: North-south: a programme for survival. London: Pan Books. Brandt Commission, 1983: Common crisis: North-South cooperation for world recovery. London: Pan Books. Cambridge, MA: MIT Press. Riddell, R. 1987: Foreign aid reconsidered. London: James Curry/ODI. Smith, D.M. 1998: How far should we care? On the spatial scope of beneficence. Progress in Human Geography 22: 15-38.
Suggested Reading Bell, M. 1994: Images, myths and alternative geographies of the third world. In D. Gregory, R. Martin and G. Smith, eds, Human geography: society, space and social science, ch. 7. Houndmills and London: Macmillan, 174-99. Corbridge, S. 1995: Development studies: a reader. London: Arnold, section 5. United Nations Development Programme, annual: Human development report. New York and Oxford: Oxford University Press.
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