Aid and conditionality: Enhancing good governance in sub-Saharan Africa
Are there areas where it has failed? This work is divided into four main chapters and a conclusion. Following this introductory chapter, chapter two reviews the evolution of the state in Africa and argues that the corrupt leadership, inefficient management and weak political institutions led to a crisis and consequently to the origin of aid conditionality. It discusses the failure of economic conditionality to deliver expected goals and opens the door for chapter three which examines political conditionality with emphasis on good governance. The third chapter is divided into three parts and the first examines the concept of governance and highlights its importance.
The second part explains the origin and meaning of the concept of good governance and the third part using examples shows how it relates to development and aid effectiveness. It argues that good governance is key to aid effectiveness and development. It demonstrates that countries with good governance achieve relatively high levels of well-being and it argues that the state has a responsibility to bring in development by creating a market friendly environment and draws a divide between the good governance approach and neo-liberalism on the roles of the state and market.
It places the state at the centre in contrast to neo-liberalism which sees the market as playing a more determinant role towards achieving sustainable development. Chapter four reviews EU projects to enhance good governance in selected countries and argues that transparent national institutions and increased accountability are necessary to foster development and consolidate peace. The first part analyses the EU approach which is maily dialogue and capacity-building and not by prescribing and dictating to the African countries.
It discusses the Centre for Common Ground project in Angola which deals with capacity-building, liberalisation of Angolan media and promoting an active civil society. This part also discusses the role of the EIDHR for the consolidation of the rule of law, institutional capacity-building and budget support to Burkina Faso.
It uses the example of Zimbabwe to argue that dialogue and not sanctions can lead to good governance. Chapter five examines World Bank projects which lay emphasis on capacity-building and institutional reforms to strengthen both the civil society and the central government. It argues that powerful government institutions and an active and participatory civil society form the basis of sustainable development.
It analyses case studies in some countries which have received adjustment lendings to fight corruption and carry out reforms in financial management. Both qualitative and quantitative designs were adopted for this study in order to attain an empirical research. The qualitative design was geared towards collecting first hand information and it was totally descriptive. For this, a questionaire with fifteen open ended questions was prepared and the reason was to get the original positions of the different bodies.
The questionnaire was electronically submitted to the EU while the ACP was contacted to create a rapport and to explain the purpose of the study. A questionnaire was later submitted to them. The quantitative design made use of published books, scholarly articles, relevant internet resources, public sources and expert consultations.
The combination of the two designs was geared towards achieving an empirical research.
Aid and conditionality: Enhancing good governance in sub-Saharan Africa
The purposive sampling technique was used in selecting the consulted organisations. The EU and the ACP were purposively chosen because they have the expert knowledge and resources necessary for the successful completion of the work. A frequency count and a manual statistical computation were used in processing and analysing the collected data. This chapter examines the origin and evolution of conditionality in international development cooperation between Africa  and multilateral donors like the World Bank and the EU.
It is divided into two parts and the first part begins with a brief recapitulation of the colonial foundations of the states in Africa. It discusses their attempts to embark on western development models and how their dismal failure despite many decades of development cooperation and huge amounts in aid, led to the emergence of aid conditionality. The second part deals with the donor imposed economic reform package and discusses its failure to meet the intended goals.
The chapter argues that corrupt African leadership and weak political institutions led to the imposition of conditionality and this ties up with the argument that good governance enhances transparency in the use of development aid and improvement in the use of political power by leaders.
In the s, most African countries attained independence and accepted the legal and political structures they inherited from their colonial masters. These emerging African states viewed development as a change from their traditional subsistence to a modern economy. And such development could only be achieved through an elitist top-down approach that was dependent on the application of modern science, technology and expert knowledge held outside Africa Thomas, The aim of this western model of development was to reproduce the same technological advancements and economic prosperity found in the west.
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The driving force behind this approach to development was the neo-liberal believe that such development will trickle down from the top to the bottom of the society for the mutual benefit of all which we are yet to witness. However, some African countries rejected this capitalist approach to development and instead opted for the socialist conception of development that was practiced in Eastern Europe. But a common feature of these Africanised visions of development was their state-centric nature. In order to promote development, the state was recognized as the main actor and played a major role in the ownership and management of natural resources.
And for the state to effectively play this role there emerged a concentration of management functions at the centre and the economy was managed through parastatals .
Aid and conditionality: Enhancing good governance in sub-Saharan Africa
These state-controlled enterprises had complete jurisdiction in a considerable range of policy issues Ntambirweki, The lack of supervision on these enterprises led to the abuse of power and excessive corruption by the controlling bureaucracies who used them for their personal gains.
The situation was further exacerbated by the absence of accountability, democratic values and institutions. Public interests, local values, concerns and traditions were neglected because of the concentration of management in the centre.
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The emergent African states failed to bequeath the institutions necessary to sustain democratic and effective or good governance. Most countries failed to implement constitutional rule, as there was a proliferation of military governments in the entire region. The deteriorating situation in Africa forced the EU and other donor organizations like the World Bank to change their attitudes towards the recipient African countries. Consequently, there emerged an alternative approach in development thinking and conditionality became a prerequisite for aid.
Conditionality is therefore the reflection of western donor support for an alternative approach to development. It is the compelling insistence of donor countries for compliance by the recipient states. All African countries are recipients of aid and some depend on foreign aid on about twenty four percent of their national budgets.
Donors lost confidence in the national governments because of the deplorable state of development in the region. The sovereignty of the recipient African countries became increasingly undermined thus bringing into question the communitarian notion of international relations .
On the other hand, donor confidence increased occasioning a re-think of the hitherto prevailing doctrine of non-intervention in the internal affairs of sovereign states. Conditionality is therefore enhancing the Westphalian notion of international society. The s marked the peak of economic and political crisis in Africa as most governments became bankrupt and heavily indebted. Most states in the region were unable to finance their national expenditures or to service the huge amounts of debt owed to aid donor nations and private banks.
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There was rising inflation in the entire region and a very slow growth. In the republic of Benin for instance, there was economic stagnation and the bankrupt government could no longer pay salaries of civil servants Lancaster, Faced with these difficult situations, African governments turned to multilateral donors like the IMF, World Bank and the EU for more aid and debt relief. Key to these problems was the huge mismanagement and misallocation of economic resources by African leaders.
The World Bank once offered loans to Equatorial Guinea to promote cocoa farming and government ministers immediately seized the best cocoa farms and spent the loans on luxury cars.
A study carried out between and , showed that for every one dollar that Africa received in aid, eighty cents flowed out as capital flight into Swiss bank accounts or to buy mansions in Europe The Economist, This attitude of the ruling class made the debt burden of African countries heavier, made aid ineffective and stagnated development. Faced with increased demand from the African countries and the ever-deteriorating situation in the region, multilateral donors like the World Bank, the EU and other aid donors designed and funded economic reform programmes.
This was because many African countries had deep-seated economic problems and started experiencing structural problems. The donors started broadening conditionality to structural issues and that became more apparent in the s. In , a study by David Dollar and Lant Pritchett of the World Bank showed that countries with sound economic policies and good institutions benefitted from aid The Economist, African governments therefore accepted to implement structural and sectoral adjustment programmes as prerequisites of aid.
The Structural Adjustment Programmes SAP were aimed at combating the ever rising inflation and achieving favourable balance of payments for African economies. Conditionality became formalised because of innovative thinking by Jacques Polak, who developed a model that had very clear policy implications in linking restoration of stability in the balance of payments through excessively expansionary monetary and fiscal policies. So instead of requiring countries to try to act directly on the balance of payments, which would be very difficult, the World Bank wanted the African countries to try to act directly on monetary and fiscal policies that they could control.
It was hoped that reduced inflation would increase investment that was necessary for economic recovery in the entire region. Governments were required to cut spending, liberalise domestic markets, reform their tax systems and reduce trade barriers. Also, the recipient states were asked to carry out administrative reforms and the privatisation of parastatals. Surprisingly, the dream of increased investment and the most cherished goals of economic reform in Africa were never attained.
Unemployment remained high in most of the region and economic growth was slow. One reason for this was the unbalanced implementation of economic reforms with most governments resisting civil service reforms and privatisation. Most stabilisation programmes were never fully implemented and they had the negative impact of restraining domestic demand for imports Lancaster, Reforms in prices, public services, policies and institutions involving agriculture, education, finance were insufficient and poorly implemented.
Under conditionality, African countries were compelled to implement measures which essentially complicated the economic problems confronting them. The economic reform package imposed by the donor countries of the West, IMF and World Bank contained the virus that led to the crash of the economies of the recipient countries.
Multilateral donors like the IMF, World Bank and the EU expected countries to reform but did not allow them to design their own programmes. The SAPs were particularly geared towards enabling the highly indebted countries in the region to generate sufficient funds to service their debts. This led to frequent conflicts between the donors especially the World Bank and the recipient countries which began to resist the strict implementation of the SAP.
Privatisation and economic liberalisation exposed the poor masses to excessive exploitation by capitalist owned multinational corporations. In most parts of Africa, factories were closed down and workers laid off as a result of World Bank imposed policies that were later shown to be flawed. For example, in cashew-nuts processors in Mozambique were demanding a fifteen million dollar compensation from the World Bank to force it to pay for its mistakes.
Academics and think-tanks continue to search for solutions to Africa's longstanding problems. African governments owe billions of dollars in debt Polanyi, This irreversible trend brought the good governance discourse in development cooperation between the donors and African counterparts. The purpose of this paper is to examine how the concept of good governance is being implemented in Africa. For clarity purposes, the work is limited to the analysis of the efforts being made by the European Union EU and the World Bank in assisting African countries to implement good governance.
This choice is based on the fact that the EU and World Bank are the main multilateral aid donors and development partners of the region.
It argues that good governance enhances transparency in the use of development aid, helps to reduce poverty and spurs development, and that it is necessary to foster institutional reforms causative argument. The paper further argues that implementing good governance will improve the use of political power by leaders and help in the consolidation of peace normative argument. Achieving global governance is a main issue in international politics today.
Enforcing good governance is a must if Africa has to be fully integrated into the process of globalisation. And for globalisation to be complete and meaningful, poverty in Africa as well as other parts of the world must be eradicated. No amount of foreign aid can lead to meaningful development without effective governance.
The poor state of development in Africa produces a backlash that has a global reach. Europe for example is facing a huge influx of migrants from Africa in search for greener pastures. Eradicating poverty is therefore a global challenge as the world becomes smaller.