Aid and accountability

Today the Prime Minister, Tony Blair, flies to Washington for talks with President George W Bush. He will seek to persuade the White House to back calls to cancel the debt of poorer countries and to back Gordon Brown's proposed International Finance Facility. This may prove an uphill task, for the US Congress, not just the President, needs to be convinced that any such programme will have a chance of working and that debt relief is not simply squandered in the purchase of more arms or diverted into the pockets of corrupt dictators. For every dollar lent to Africa in recent decades, 80 cents has disappeared into the secret accounts of dictators and their allies. That is why the US is concerned to see a commitment, not just to free trade and economic reform but to openness and transparency in the dealings of African governments.

These are reasonable points, and those who think that ending poverty is simply about bullying the US and the other G8 countries into handing over more money need to address this question of means in more detail than is currently evident. Over the past 50 years rich countries have poured, on average, $100 billion a decade into Africa alone, with precious little to show for this largesse. Ditto the World Bank, which handed out more than $260 billion between 1980 and 2003 across the globe. Often, the more aid a country got, the worse it did. Between 1980 and 2002, 39 recipients of World Bank money experienced negative annual growth per capita, and 17 experienced growth of between zero and 1 per cent a year. The bank's record in sub-Saharan Africa is particularly lamentable: among half its recipients, per capita incomes fell. What the poorest countries need to make them prosperous is good governance: the rule of law, respect for property rights, less than rampant corruption and sensible macro economics. Gesture politics will just not fix it.