The Templeton Foundation's ad in Sunday's NYTimes, and the associated postings on the foundation's Web site asked "Will Money Solve Africa's Development Problems?" A quick glance at the distribution of answers is bound to cause some chagrin in the development aid world. Of the eight men asked, two said "yes," five said "no" or "no way" or "I thought so" (which I took as a 'no") and one hedged his bet with "only if."
But don't be deceived. The balance of the replies was not so much anti-aid as anti-official aid, and aid that supports free enterprise and entrepreneurial initiative. Except for James Shikwati CEO of The African Executive business magazine, none explicitly argued that that outsiders--or their money--should withdraw altogether.
For example, James Tooley (a "Yes") wants money to support private schools, not big public education bureaucracies.
Donald Kaberuka, president of the African Development Bank, seemed a surprise with his "No." But it turns out he was clever (for a Templeton Foundation sponsored conversation) to start with "No" and then segue into why "we must realize money is still needed" -- for infrastructure, education and to fight AIDs.
Michael Fairbanks ("I thought so"), co-founder of a group that provides grants for enterprise solutions to poverty, implied that helping works, but only if local leaders are really in charge (such as President Kagame in Rwanda).
Iqbal Quadir ("Only if"), founder of GrameenPhone in Bangladesh, suggested giving the money directly to citizens.
Edward Green ("No") was a real no. The Director of the AIDS Prevention Research Project at Harvard said that all the externally financed AIDS programs are on the wrong track because the Western biomedical model ignores "multiple, concurrent sexual partners" -- he cited Uganda's local initiative to change sexual norms as the alternative. (If you want to know how aid for AIDS is being spent, see Following the Funding for HIV/AIDS: A Comparative Analysis of the Funding Practices of PEPFAR, the Global Fund and World Bank MAP in Mozambique, Uganda and Zambia, a new report from CGD's HIV/AIDS Monitor team.
Ashraf Ghani, who served as finance minister in Afghanistan after the overthrow of the Taliban, said "Yes." He called for outside investment to focus on credible leaders and managers, local institutions, and regional infrastructure. But even Ghani started by decrying the current "uncoordinated and ineffective aid system," calling for reallocation of the $5 billion donors currently provide annually in technical assistance simply "to meet donor requirements."
Bill Easterly, a professor at NYU and a non-resident fellow here at the Center for Global Development, repeated his critique of the aid system -- but from other writing, such as The White Man's Burden, we know he favors some kind of aid under some circumstances.
Unfortunately the Templeton ad is more likely to sow more confusion than to create momentum for reform of the official aid business. Private initiatives are healthy. But the real challenge is how to fix official aid -- so it complements rather than undermining entrepreneurship in Africa. For more on that see my working paper: Do No Harm: Aid, Weak Institutions, and the Missing Middle in Africa and An Aid-Institutions Paradox?
A Review Essay on Aid Dependency and State Building in Sub-Saharan Africa, by Todd Moss, Gunilla Pettersson, and Nicolas van de Walle.