Trade, Not Aid

Bono, with the support of Hollywood and his 'One' campaign, has always been on the forefront of the African aid issue. There is no need to debate Bono's intentions, he comes across as honestly wanting to help the African peoples (Bono, surprisingly articulate, does makes a very persuasive argument). But there are a number of people out there --such as my self--who say he is not really helping, in fact, he is only harming Africa. These critics claim the West should be focusing on helping the Africans nurture their own wealth instead of giving them hand-outs. In a recent Los Angeles Times article, William Easterly writes:

The real Africa needs increased trade from the West more than it needs more aid handouts. A respected Ugandan journalist, Andrew Mwenda, made this point at a recent African conference despite the fact that the world's most famous celebrity activist — Bono — was attempting to shout him down. Mwenda was suffering from too much reality for Bono's taste: "What man or nation has ever become rich by holding out a begging bowl?" asked Mwenda.

An article written by Jennifer Brea at American.com gives a great analysis on the issue:

For the thousands of foreign-educated lawyers, businessmen, and architects from the Diaspora who are leaving cushy corporate jobs to return home with their skills and their dynamism to open businesses, it's about creating wealth, not reducing poverty. Africa is not a victim in need of saving: it's a land of opportunity.

She goes on to write:

We can continue the endless cycle of need and dependency, or you can create jobs, develop indigenous capacity, and build a sustainable future.

Aid not only crowds out local entrepreneurship, it makes governments lazy and deprives countries of the incentive to build effective institutions. Public revenue derived from taxes makes governments directly responsible to their citizens. Free money builds white elephants and bloated bureaucracies, it being far easier to create new government jobs than implement policies to fight unemployment, especially when someone else is footing the bill.

The overall message:

Aid can alleviate immediate misery and that is why we love it. Charity is a profoundly human response to all those images that pull on our heartstrings. But all evidence points to the maddening conclusion that, in the long run, aid not only has no positive effect on economic growth, it may even undermine it.

Does this mean the West should stop helping Africa? Absolutely not. One of the major problems in Africa, notably in Sudan, are the corrupt governments. Free markets can go only go so far, the political environment must be free also for any true change to occur. Bono's plan to keep aid going only perpetuates the problem of corrupt governments and impoverished Africans. The West has an opportunity to intervene in situations such as the Sudan and break the chains of exploitive, violent governments so the African people can go on to help themselves.

UPDATE: I soon as I was done writing this post, I took a gander at Thomas Barnett's blog and found this interesting post.