Wealthy donor countries set the guidelines for defining “Official Development Assistance”. This allows donors to artificially inflate the amount of aid they claim to provide by including items which do not contribute to poverty alleviation.
In addition, there are many misconceptions about aid, trade and foreign policy which affect our analysis of Australia’s and other nation’s aid programs.
Contemporary approaches to aid and development follow a long history from colonialism and post-colonialism through the post-World War II establishment of the United Nations and other international institutions. An understanding of this history enables us to appreciate the structural inequalities and imbalances in power in the global community.
In recent years, some new players have emerged in the aid environment. These developments reflect changes in global power relations. This includes states such as China and Taiwan taking on roles as key bilateral donors and the growth of private actors as donors. The growth of philanthropy and private capital flows in aid may be seen a reflection of the increasing power of private capital in the global economy, vis a vis nation states.
Aid priorities are subject to various differences of opinion between AusAid, NGOs and others. There are competing views on issues such as:
- aid for development driven by economic growth
- security interests
- increased recipient autonomy
- grassroots development.
The official objective of Australia’s overseas aid program is “to assist developing countries reduce poverty and achieve sustainable development, in line with Australia’s national interest”.
- Aid should be first and foremost guided by the needs of communities, allowing communities to determine their own development needs
- Aid should promote local ownership and sustainability
- Aid should be based on principles of social and environmental justice and support sustainable and long-term self-determination.
- Aid should be a mechanism of global social responsibility; not a tool for Australia’s national interest.
- The final outcome of aid should be to remove the need for aid
The international community addresses the conflicting views on aid priorities through initiatives such as the Millennium Development Goals and the Paris Declaration, intended to render aid more effective in alleviating poverty.