Aid and reform in Africa : Lesson from ten case studies

Abstract

While foreign aid is productive in countries with good policies, the Bank's landmark study, Assessing Aid, found that on average there was no discernible link between aid and reform. An in-depth examination of the relationship between aid and reform in ten African countries, this book reveals a much more complex picture. Aid can be beneficial or harmful to policy reform-or it can have little effect. Policy reform is almost never triggered by aid. It is mostly triggered by a crisis. In some cases, aid can retard reform by giving bad governments "breathing room". However, once the reform process is under way, the experiences of Ghana and Uganda show that foreign aid can be useful in galvanising support for reform within the government. Finally, when the country enters the second generation of reforms, such as public sector institutional reform, short-term, conditionality-based aid can once again be harmful-by reducing ownership, participation, and sustainability of the reform...