Aid to Africa
So, the G8 has decided to double aid to Africa and cancel all debt.
http://allafrica.com/stories/200507111507.html
Cancelling Africa's debt is definitely a super thing for the developed world to do. However, I have some concerns about the other one - Aid.
I dont agree with the way aid is measured. 50 billion dollars sounds like a lot of money, but the problem is that it is going to be largely goods and not cash - Which means that you are going to get about 50 billion dollars worth of American/German/Japanese/etc goods ... And not 50 billion dollars worth of African goods.
Let me explain - What can $10 buy in the US ? - About 4 cans of soup. The same $10 can buy about 40 cans of soup in the developing world. And by giving most of the aid in the form of goods, the contribution is diluted.
Another example is contributions by Pharma companies to Tsunami relief - If they make a contribution of $10 Million worth of drugs, it probably only cost them $1 Million, because manufacturing costs for Pharma companies are such a small % of total costs.
In the short term, aid is great, but if there is to be long term improvement in the quality of ife of Africans, subsidies in the developed world (Farm/Tobacco subsidies in the US for instance) need to be removed so that African products can compete in the world stage.
http://allafrica.com/stories/200507111507.html
Cancelling Africa's debt is definitely a super thing for the developed world to do. However, I have some concerns about the other one - Aid.
I dont agree with the way aid is measured. 50 billion dollars sounds like a lot of money, but the problem is that it is going to be largely goods and not cash - Which means that you are going to get about 50 billion dollars worth of American/German/Japanese/etc goods ... And not 50 billion dollars worth of African goods.
Let me explain - What can $10 buy in the US ? - About 4 cans of soup. The same $10 can buy about 40 cans of soup in the developing world. And by giving most of the aid in the form of goods, the contribution is diluted.
Another example is contributions by Pharma companies to Tsunami relief - If they make a contribution of $10 Million worth of drugs, it probably only cost them $1 Million, because manufacturing costs for Pharma companies are such a small % of total costs.
In the short term, aid is great, but if there is to be long term improvement in the quality of ife of Africans, subsidies in the developed world (Farm/Tobacco subsidies in the US for instance) need to be removed so that African products can compete in the world stage.
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