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The bloated, arrogant aid industry will not let Africa go without a fight

Africa needs trade and not aid
Friday, September 25, 2015

By Alex Perry

Trade not Aid

Africa is standing up. After centuries of poverty, the world’s largest continent is developing fast. Economic growth in Africa will be around 5 per cent this year and has doubled the global average for more than a decade.

The proportion of Africans defined as absolutely poor – living on US$1.25 a day or less – has fallen by one third to four in ten since the 1990s; there are now 160,000 millionaires in Africa, and the average African earns US$1,720 a year (US$200 more than the average Indian).

Thirty years after Live Aid, Ethiopia’s first yuppies are traders on Africa’s first commodities exchange. This transformation is bringing the end of human poverty within sight. So it might seem in tune with the times that aid activists lobbying the UN General Assembly this month in New York are urging world leaders to end poverty by 2030. But that it is to misunderstand the dynamics of the aid industry.

The campaigners are not asking for the end of African poverty. They are asking for the end of African poverty through aid.

Foreign aid has long been problematic. Sometimes corrupt and generally inefficient, even the best aid suffers from the paradox of the patrician: that by finding noble purpose in the lives of others, you can subtract that same purpose from those lives; that the very act of trying to help someone can diminish them.

Many aid workers are reasonable, well-intentioned and driven. Time was when most admitted these conundrums but accepted their flawed system as the only system there was.

Assistance, it is true, does have a place as a temporary measure in emergencies or even to effect a one-time lift out of systemic misfortune – such as the campaign to lift the burden of malaria, which has saved 6 million lives since 2000. But until recently, all involved understood that the driver of human progress was not external charity but the product of more internal energies: hope, initiative, grit, imagination.

As aid has grown, it has lost its humility. It is now a mammoth global industry worth US$134.8 billion and employing 600,000 people a year – more than the world’s most valuable business, US oil and gas.

In sub-Saharan Africa, it is worth an annual US$55.8 billion, making it equivalent to the yearly output of Africa’s 20 poorest countries. That is to say that aid is the biggest business in Africa, worth close to half the continent.

Like any business, aid looks to protect its bottom line and to grow. And aid’s business is crisis.

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