Dead Aid: Why Aid Is Not Working And How There Is Another Way For Africa by Dambisa Moyo (Allen Lane, £14.99) (From The Northern Echo)

Dead Aid: Why Aid Is Not Working And How There Is Another Way For Africa by Dambisa Moyo (Allen Lane, £14.99)

4:54pm Wednesday 11th March 2009

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WE all ought to club together and buy Bob Geldof and Bono a copy of this book apiece and make them sit down and read it out aloud to each other.

Dambisa Moyo was born and raised in Zambia and she holds an Oxford PhD in economics and a Masters from Havard. She asks: “Why do the majority of sub-Saharan countries flounder in a seemingly never-ending cycle of corruption, disease, poverty and aid-dependency despite the fact that these countries have received more than $300bn in aid since 1979? The answer is that African countries are poor precisely because of that aid.”

Here are some facts. Between 1970 and 1978, when aid flows to Africa were at their peak, the poverty rate rose from 11 per cent to 66 per cent.

On the corruption front, President Mobutu Sese Seko of Zaire stole a sum equivalent to the entire external debt of his country, $5bn. No sooner had he requested a reduction in interest payments on massive foreign loans than he hired Concorde to fly his daughter to her wedding on the Ivory Coast.

Aid produces wars. Because it is usually provided directly to African governments and so makes government worth fighting for.

Moyo’s criticisms of the aid industry and its radical chic superstars is devastating. “The pop culture of aid has bolstered misconceptions. Aid has become part of the entertainment industry. Aid has helped make the poor poorer,” she says.

“The evidence is as startling as it is obvious. Those countries which have rejected the aid route have prospered, while others which have become dependent on aid are trapped in a vicious circle of corruption, market distortion and further poverty – and thus the ‘need’ for more aid.”

Moyo talks about “the rise of glamour aid and orchestrated worldwide pity which began in 1971 with the Beatle George Harrison’s Concert for Bangladesh. Public discourse became a public disco. One disastrous consequence of this has been that honest, critical and serious dialogue and debate on the merits and demerits of aid has atrophied. As one critic of the aid model remarked, ‘My voice can’t compete with an electric guitar’.”

Aid is a proven disaster. “There is no other sector, whether it be business or politics, where such proven failure is allowed to persist in the face of such stark and unassailable evidence.

Aid is not benign – it is malignant,” says Moyo.

Aid creates civil wars, it reduces savings and investment and is often inflationary. It chokes off the export sector and produces dependency.

Well, it’s one thing to diagnose the disease and Moyo, this courageous African economist, has certainly achieved this. But what about the cure? Here, too, she is quite definite:

“First, African governments should follow Asian emerging markets in accessing the international bond markets and taking advantage of the falling yields paid by sovereign borrowers.

Secondly, they should encourage the Chinese policy of largescale direct investment in infrastructure. Thirdly, they should continue to press for genuine free trade in agricultural products. And fourthly, they should grant the inhabitants of shanty towns secure legal title to their homes, so that these can be used as collateral.”

For God’s sake, Bob and Bono, turn the electronic pop amplification down for an hour or two and use the silence to read this – truth to tell.

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