International Economics

Foreign Aid Hokey Pokey in Kenya



I recently returned from a trip to East Africa. I spent most of my time in Kenya in areas unaffected by the post-election violence, and saw no demonstrations or looting. Even if I had been in the thick of things, I'm not sure I would have had much to say besides the commentary most outsiders have offered: Man, this totally sucks.

(For great, well-informed, in-country, ant's-eye-view commentary, check out Alex Halperin's blog)

What I did see on my trip was a little political graffiti–and a lot of evidence of the impact of foreign aid on the region. The single decent road I drove on in Tanzania, for example, was a gift from Japan. Everything else was broken gravel at best.

As Kenya, previously held up as a model of stability and relative prosperity in Africa, falls apart, the U.S. and other nations that contribute aid dollars are threatening a tug on the purse strings if the government fails to act. The Kenyan government isn't taking it well:

Kenya's government also brushed aside threats by its major international donors, including the United States, to review foreign aid.

"Our budget is not dependent on foreign funding," said Alfred Mutua, a government spokesman. "The government cannot be blackmailed. "You are here as our development partners, you are not here to blackmail and threaten us," he said referring to foreign donors. "We have said our government will continue as always. They should not try to threaten us."

Fourteen of Kenya's leading donors, including the United States, issued a statement this week warning the Kenyan government that they were reviewing foreign aid in light of the crisis. The United States gives the country more than $600 million in aid each year.

There's a certain amount of foreign aid hokey pokey going on in the region: You take the foreign aid out/ you put the emergency aid in/ you take the aid workers out/ and you shake it all about.

Of course, it matters who is administering the money. We're taking money from the hands of the government, which is part of the problem, and putting it into the hands of independent aid efforts. But still, this kind of aid dollars switcheroo doesn't seem to be making much of an impact.

This seems to be a classic case of "do-somethings." But is there a better option than my response (reminder: "Man, this sucks") or just rearranging deck chairs on the Titanic?