Wasted billions: how aid development helps no one

Frank Bremer has dedicated his life to the fight against poverty. He has been involved in development aid in 30 countries in Africa, Central Asia, the Caribbean and the Indian Ocean, preparing projects in the fields of rural development and the environment. Yet after more than 50 years of involvement with development aid, he issues a bitter assessment in his new book: 

“Development aid is a project that carries out ineffective activities for an unachievable goal – poverty reduction – for a wrongly selected target group – African smallholder farmers – with a method that does not work – help for self-help – in an ineffective format – the project – which, like flash in the pan, leaves no lasting traces on anyone involved apart from fond memories, uses most of the funds for project implementation and thus takes what was originally a good idea and wastes a great deal of money.”

The fight against poverty remains one of the most important tasks facing humanity, but development aid (the politically correct word for this is now “development cooperation”) is the wrong means to achieve this noble goal. In many cases, it has accomplished nothing. In others, it has actually achieved the very opposite of what was intended.

Helpless help for self-help experts

In his book 50 Jahre Entwicklungshilfe – 50 Jahre Strohfeuer (50 Years of Development Aid – 50 Years of Flash in the Pan), Bremer reproduces a dialogue between the head of a village community and a German development worker (“self-help expert”), which is fictional but made up of snippets of actual conversations and is based on Bremer’s decades of practical experience in the field. Bremer had conducted the progress check for this project. It’s worth quoting in full. C is the head of the village community and S is the self-help expert.

C: “Sir, we need a small dam to provide water for our cattle and farmers in the dry season.”

S: “That is a very sensible goal, but let me explain what you need first. You need to improve your management capacities to tackle a project like a dam; you need analytical tools, meetings and training on how to hold meetings and deal with group dynamics, as well as thinking about how to involve women; you need negotiation and decision-making techniques, which you can learn by consulting our experts, you need…”

C: “Oh sir, it seems as if that will all take a lot of time. If fresh water stays in the mouth too long, it turns into saliva. And our dam?”

S: “One step at a time, you need to be more process-oriented. Believe me, our self-help specialists know what you need to get your dam.”

C: “Okay, once we’ve done all that, do we get our dam?”

S: “It is certainly possible. But before you tackle a big project like a dam, you should start small, e.g. digging a well by hand, without a pump and winch or anything.”

C: “Sir, we have enough wells and boreholes, and some of them even have hand pumps. What we need is a dam.”

S: “Ask the women in the village. I’m sure there are some who don’t have a well yet.”

C: “Okay, the beggar doesn’t have a well. We’ll dig one for him. Will we get a dam then?”

S: “That depends on you. Fifty-fifty participation in cash, plus provision of labour and building materials; cash to be paid in advance.”

C: “Fifty per cent, Sir? That’s too much for most families.”

S: “That’s as may be, but if you don’t contribute 50 per cent, your long-term ownership-feeling won’t be strong enough. 49 per cent is not enough.”

C: “Okay, you’ll get your 50 per cent. Will we then get our dam?”

S: “That depends on so many factors: Can we finance the other 50 per cent? Is it technically feasible? Do we have enough time? Anyway, always remember that for you the learning process is more important than the result. See you in the next meeting.”

“Help for self-help?”

Bremer promises that, although the above dialogue sounds like a caricature, it actually happened. As a result, not a single dam or retention basin was built, but the target group was taught, in theory, how to help themselves.

In his eviscerating book, Bremer criticises the very principle of development aid, which is based on so-called “projects.” Although there is so much talk about sustainability today, these projects are rarely sustainable. Hardly anyone is concerned with what has become of such projects, for example, ten years after they have come to an end.

If you drive through the African countryside, you will constantly pass rusting project signs, sometimes even from several donors in the same place: They look like grave markers, the last remaining signs that something was once there. There is no money left, not even enough to dismantle the signs at the end of the project – at best they are used by village blacksmiths to make cooking pots.

While they were running, many of these projects were quite successful, as there was enough money for materials, operating resources, vehicles and high salaries. But once the funding dried up, it became clear that these highly subsidised projects were all nothing more than “uneconomic flashes in the pan,” of which nothing remained once they ended.

Flash in the pan projects

Bremer knows Côte d’Ivoire (Ivory Coast) particularly well, a country in West Africa that is the world’s largest exporter of cocoa. As early as 1977, the ethnologist, sociologist and development economist wrote his doctoral thesis on the history of cocoa production in Côte d’Ivoire and still lives there today. His assessment of the development aid projects in the country is harsh: With the exception of a forestry project, not one of the 24 completed projects had a long-term impact: “Assessed against this criterion, they were all failures or just flashes in the pan, costing a total of €125 million.”

Another example he provides concerns the construction and maintenance of a veterinary pharmacy in Burundi’s economic capital Bujumbura. The project lasted 22 years with the same seconded specialist, but the pharmacy became unviable shortly after funding ended and had to close. “This is what happens,” says Bremer, “when development aid enters private-sector terrain, but dispenses with needs analyses, business plans and profitability calculations and thus uses taxpayers’ money to set up a subsidised playground for seconded professionals.”

When the funding runs out, a project is terminated, although this doesn’t prevent the development workers from setting up a similar project a few years later in the same or another country, the failure of which is equally certain from the outset.

Bremer’s overall conclusion is therefore devastating: “This has been going on for 50 years, and the entire international development aid industry, which is financed with public funds, lives from this kind of project. The alleged beneficiaries, the poor farmers, who are supposed to be helped by these projects, are no less poor at the end and are once again left to fend for themselves. Instead of helping the poor, these projects create countless jobs for seconded professionals and their supervisors at the aid organisations’ headquarters.”

In many cases, fashions dictate which topics receive the most funds. For example, a hype developed around eco-farms: According to Bremer, “for twelve years they remained an inconsequential playground for seconded experts and their technical experts, who pursued the ecological and/or site-appropriate agriculture that has become so fashionable. All in all, about €20 million have been sunk into the Savannah sand on these projects.”

The general public in the donor countries is not interested. The projects are, after all, so far away – and whether they really make a difference or not is a subject to be debated between academics. Politicians and the media are understandably more concerned with the issues that preoccupy and interest voters and readers in the donor countries – and not with the question of whether the billions in development aid are being used wisely.

The examples of successful countries such as China, Poland and Vietnam show that it is not development aid but market-based reforms that achieve the most in the fight against poverty. The dramatic decline in poverty in these countries was not accomplished primarily a result of high development aid payments, it was the result of introducing private property and more capitalism into the system. It is not development aid that is the best instrument in the fight against poverty, but capitalism.

Rainer Zitelmann is a historian and sociologist and author of the soon-to-be-published book In Defense of Capitalism.

This piece was originally published in Townhall

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