Moyo's confused attack on aid for Africa, by Jeffrey Sachs, voxeu.org: Ms. Dambisa Moyo's recent Huffington Post article exposes the confusions that underlie her slashing attacks on aid. Most importantly, she seems to believe that sub-Saharan Africa was economically prosperous and then was pushed into poverty by aid. She makes the following statement: "No surprise, then, that Africa is on the whole worse off today than it was 40 years ago. For example in the 1970's less than 10% of Africa's population lived in dire poverty -- today over 70% of sub-Saharan Africa lives on less than US$2 a day."
Let's parse that statement for a moment. World Bank researchers Shaohua Chen and Martin Ravallion (2007) prepare the benchmark under-$2-a-day historical headcount data going back to 1981. According to their figures, headcount poverty under $2 a day was 74% of the population in sub-Saharan Africa in 1981 and 73% in 2005. Other prominent estimates that go back to 1950 or 1970 also contradict Moyo's statement, by showing high and persistent poverty. All of the macroeconomic time series by Maddison (1995), Summers and Heston (1988), and others tell the same story; the majority of Africa's population started out impoverished at the time of national independence in the 1960s and 1970s, and a majority remains impoverished till today.
If we move beyond the GNP and income measures, the enormity of Africa's long-term poverty challenges become even more apparent. As we have documented elsewhere, Africa's literacy, agricultural productivity and urbanisation rates were very low in 1970. Rural poverty was pervasive. Africa's road coverage, electrification, rail network, and other infrastructure were sparse at best and typically non-existent in rural areas. Aid did not kill Africa.
Despite the persistence of poverty, many conditions in Africa have in fact improved in recent decades. Child mortality has declined from 229 per 1,000 births in 1970 to 146 per 1,000 births in 2007. Adult literacy has increased from around 27% in 1970 to around 62% in 2007. Primary school net enrolments have increased from around 53% in 1991 to around 70% in 2007. Aid has played a helpful role in this. Yet aid was very limited, averaging around $35 per African per year since 1960. Aid has never been properly resourced or targeted for a focused period to end the poverty trap and thereby to break the dependency on aid.
Africa's differences with other regions lie not in aid, but in circumstances and history. Unlike South Asia, for example, Africa has not yet had a Green Revolution of higher food yields, the formative event of India's economic takeoff from the late 1960s. India is a civilisation of great river systems and large-scale irrigation, thanks to the Himalayan snowmelt and glacier melt and the annual monsoon rains. Africa is a continent of rain-fed (non-irrigation) agriculture. The original Green Revolution, in which India's food output per land area rose markedly, came in the irrigated systems of Asia, not the rain-fed systems of Africa.
US aid heavily subsidised India's Green Revolution while World Bank opposition to aid for African agriculture from the 1980s until recently played an opposite and adverse role, holding back a similar breakthrough for Africa. It was the absence of aid for African agriculture rather than its presence that cost Africa mightily. And one can go on. Africa's tropical disease burden, heavy concentration of landlocked countries, decline of aid for infrastructure during the 1980s and 1990s, and misguided attempts by Africa's creditors to collect debt servicing under "structural adjustment programs" during the 1980s and 1990s all played their part.
Moyo now campaigns against the kinds of aid that can keep millions of African children from dying or being maimed for a lifetime through the consequences of serious episodes of disease. She advocates cutting the aid that has allowed more than 2 million Africans access to life-saving AIDS treatment, since governments are involved. Almost unimaginably, she opposes the distribution of anti-malaria bed nets for Africa's hundreds of millions of young people on the alleged grounds that it has put bed net producers in Africa out of business. In her own words:
"Finally, with respect to Mr. Sachs' remark that I would see nothing wrong with denying US$10 in aid to an African child for an anti-malarial bed net -- even labelling me as cruel; I say, if working towards a sustainable solution where Africans can make their own anti-malaria bed-nets (thereby creating jobs for Africans and a real chance for continents economic prospects) rather than encouraging all and sundry to dump malaria nets across the continent (which incidentally, put Africans out of business), then I am guilty as charged. Don't forget that the over 60% of Africans that are under the age of 24 need jobs not sympathy."
The confusion underlying this remark is staggering. There are hundreds of millions of Africans at risk of a killer disease, around 200 million cases of the disease, and around 1 million preventable deaths per year, yet Moyo is opposed to urgent help if nets are not produced in Africa. She seems both unmoved by the massive suffering and unaware that Africa has gone from producing exactly zero long-lasting insecticidal nets (LLINs) a few years ago to several million per year now, with thousands of jobs in the local industry, as a result of the demand for nets created by aid for malaria control.
She takes no note of the fact that global aid for malaria control is also training tens of thousands and soon hundred of thousands of rural Africans as community health workers; and seems to be unaware that unchecked malaria has long devastated Africa's economy while malaria control is finally emptying the hospitals, putting mothers and fathers back to work and children back to school, and contributing to the boost in Africa's productivity and economic growth of recent years. She says that if her position against aid for LLINs is deemed to be cruel, then yes, she is "guilty as charged."
Moyo is not offering a reasoned or evidence-based position on aid. Everybody that deals with aid wants to promote financial transparency and market-led growth, not aid dependency. We and others have recommended many successful mechanisms to limit corruption and ensure that aid reaches the recipients, as is happening in the disease-control programs. The purpose of aid should indeed be to break the poverty trap through targeted investments in an African Green Revolution; disease control; children's education; core infrastructure of roads, power, safe drinking water and sanitation, and broadband; and business development, including microfinance and rural diversification among impoverished smallholder farmers.
Moyo wants to cut aid off dramatically, even if that leaves millions to die. African leaders - like President Ellen Johnson Sirleaf of Liberia, Dr. Awa Coll-Seck of Roll Back Malaria, and Ministers Charity Ngilu and Beth Mugo of Kenya - have fought for Africa's poor and have used aid to save lives and help economies to prosper. These leaders disagree fundamentally and urgently with Moyo's attacks. They recommend more aid, fully accountable and properly targeted, to meet urgent needs.
Since the record shows that Africa has long been struggling with rural poverty, tropical diseases, illiteracy, and lack of infrastructure, the right solution is to help address these critical needs through transparent and targeted public and private investments. This includes both more aid and more market financing. That combination will indeed ensure that private markets and African entrepreneurship can succeed.
Chen, Shaohua and Martin Ravallion (2007),
Absolute Poverty Measures for the Developing World, 1981-2004, World Bank
Maddison, Angus (1995) Monitoring the World Economy: 1820-1992. Paris: Development Centre of the Organization for Economic Co-operation and Development, 255.
Summers, Robert, and Alan Heston (1988). “A New Set of International Comparisons of Real Product and Price Levels Estimates for 130 Countries, 1950-1985.” Review of Income and Wealth 34 (March) 1-25.