International Development Agency Essay ⋆ Business Essay Examples ⋆ EssayEmpire

An international development agency is an organization dedicated to designing, implementing, and monitoring humanitarian and economic development–related projects, and in many cases it is dedicated to distributing and managing foreign aid and international assistance programs. An international development agency could be an intergovernmental organization (such as the World Bank, United Nations Development Program, UNICEF, World Health Organization, La Francophonie, Organisation for Economic Co-operation and Development), a governmental agency (such as the United States Agency for International Development, Agencia Española de Cooperación para el Desarrollo, Swedish International Development Cooperation Agency) generally in a developed country, attached to a foreign affairs department responsible for the support of development assistance projects in underdeveloped and developing countries. An international development agency could have the support of a combination of governmental agencies, nongovernmental organizations (NGOs) such as Oxfam and organized civil society actors. Still, at the international level, most of the aid is channelled government to government. The source of the funding could be exclusively from governments, or entirely from private funds, but it also could be a mix of the two.

Overall the objectives of the international development agencies are linked to the United Nations’ Millennium Development Goals (MDGs). International development agencies tend to operate under bilateral agreements (country to country); however, there are international development agencies that work under multilateral agreements.

Foreign Aid

The distribution of aid among countries can legitimately reflect multiple aims. Aid may be used to meet humanitarian emergencies, to rebuild post conflict societies, or to support the commercial, humanitarian, or strategic interests of the donor. Still, the most frequently cited objective of aid programs is economic development.

Although economic development is not the only form of development, it has been identified both as a goal and as a condition for other interrelated development goals such as poverty alleviation, income distribution, debt relief, emergency assistance, food aid, social development, adequate health programs, provision of employment, access to education, gender equality, the spread of democracy, and the provision of a hospitable environment for foreign direct investment. This is the reason why international development agencies depend on foreign aid and why they are focused on economic development. The World Bank (2008) classifies 209 economies. It classifies 49 of them as low income, 54 as lower-middle income, 41 as upper-middle income, and 65 as high-income economies. Of the 49 low income, the vast majority are African countries, a few are Asian, and one of them Latin American (Haiti).

For several developing countries foreign aid represents a considerable component, frequently in excess of 10 percent or more of their national income. However, it is a comparatively small item in the national accounts of the aid-giving countries. Even though the amount and the scope of international transfers toward economic development have increased considerably over the last four decades, the amount of foreign aid differs significantly country to country. For instance, it represents one percent of the gross domestic product of Sweden, the Netherlands, and Denmark. In 2005 the total official development assistance (ODA) rose to a record of US$106.8 billion. Also, the provision of foreign official aid in comparison to private aid varies significantly country to country.

Historical Background

Immediately after World War II, Europe lacked financial capital. The response given by the United States was the Marshall Plan or the European Recovery Program (ERP). The ERP was an initiative for rebuilding U.S.–allied countries while repelling communism from Europe. From 1947 to 1951, US$13 billion was given in economic and technical assistance to the European countries that joined the Organization for European Economic Cooperation (former name for the Organisation for Economic Co-operation and Development). After the Marshall Plan, the participants, with the exception of Germany, surpassed the economic level they had before the war. After the success of the Marshall Plan, attention was turned to developing countries. The Marshall Plan gave rise to many of the elements of foreign aid management and delivery.

International Development Agenda

There are multiple debates on what should constitute the international development agenda. Nonetheless, there are elements that comprise the strategy for development: (1) knowledge and technology transfer from more developed countries; (2) potential role of foreign direct investment (including both long and short term investment); (3) increased role of exports and imports; (4) acquisition of significant levels of resource mobilization; (5) maintenance of a steady macroeconomic environment; (6) investment to dramatically improve social and physical infrastructure (health, transportation, communication, education, etc.); (7) reliance on market mechanisms; (8) well-functioning government institutions; and (9) development of regulatory structures and other market institutions.

Several texts on development have promoted strategic and tactical justification of certain interventions and practices and excluded and delegitimized others. In general, the literature on development is closely related to the literature on apparatuses of power and domination. Development can be autonomous, appropriated, gender conscious, sustainable, or the opposite of all these—the definition depends on the nation, university, policy, or international agencies that define it.

There has never been consensus on the meaning of development. The Westernized idea of development has been used as an agent of economic and cultural hegemony, and some authors argue that development as a construct is used to justify colonization.

Since the creation of Bretton Woods, the idea of development has become fully identified with the idea of economic growth measured as the intensification of production using such measures as gross national product (GNP). The word underdeveloped in reference to countries was introduced by U.S. President Harry S Truman on January 20, 1949, in the inaugural speech of the Marshall Plan, introducing a word that labelled and stigmatized those countries that did not fit into the pattern of development dictated by the United States and suggesting it was the “duty” of major nations to improve underdeveloped areas.

Development aid has been a highly controversial subject. Defenders of such aid argue, first, that aid provides emergency assistance and debt relief and that if well administered, its provision can produce long-term improvement in areas such as health, human rights, education, etc.; second, that it can be seen as an exercise of interdependence in which both donors and recipients can pursue their respective interests. On the other hand, the rationale against aid is based on arguments such as (1) aid has been used by authoritarian governments to consolidate their power, meaning it has little effect on the poor; (2) it is used to divert attention from issues such as trade, debt, and the role of TNCs; (3) aid creates dependency, thus weakening the political and economic position of aid recipients; (4) it distorts the free market; (5) aid is often subject to conditions to buy goods and services from the “donor”; (6) the donor-recipient dynamic reinforces stereotypical superiority and racism; (7) aid maintains world inequality rather than challenging it; and (8) aid is often displaced or misused.

Bibliography:

Santanu Chatterjee and Stephen J. Turnovsky, “Foreign Aid and Economic Growth: The Role of Flexible Labor Supply,” Journal of Development Economics (v.84/1, 2007);
Alberto Chong and Mark Gradstein, “What Determines Foreign Aid? The Donors’ Perspective,” Journal of Development Economics (v.87/1, 2008);
Jamey Essex, “The Neoliberalization of Development: Trade Capacity Building and Security at the US Agency for International Development,” Antipode (v.40/2, 2008);
Jonathan Hudec, “U.S. Agency for International Development,” National Journal (v.37/25, 2005);
Roberto Patricio Korzeniewicz and William C. Smith, “Poverty, Inequality, and Growth in Latin America: Searching for the High Road to Globalization,” Latin American Research Review (v.35/3, 2000);
Paul J. Nelson, “Human Rights, the Millennium Development Goals, and the Future of Development Cooperation,” World Development (v.35/12, 2007);
Albert G. Schweinberger and Sajal Lahiri, “On the Provision of Official and Private Foreign Aid,” Journal of Development Economics (v.80/1, 2006);
Margaret Sutton, “UNESCO’s Role in Global Educational Development,” Comparative Education Review (v.51/2, 2007);
World Bank, World Development Indicators, 2007, siteresources.worldbank.org (cited March 2009).

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