Global Policy Forum

Doners Shift More Aid to NGOs

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By Sam Chege

Africa Recovery, UN Department of Public Information
June, 1999

A major shift in funding development in Africa, already under way for several years, is accelerating. In February US Ambassador to Kenya Prudence Bushnell announced her government would now channel most of its development aid in Africa - estimated at $711.3 mn this year through non-governmental organizations (NGOs), rather than governments. A public affairs officer in the Africa Bureau at the State Department, Mr. Louis Segsvary, later explained that Ambassador Bushnell's views reflected a US policy, adopted in 1992, of working more closely with NGOs in situations where governments are widely seen as corrupt. By 1996, the US was already channeling more than 30 per cent of its aid through NGOs.


The US stance is being followed, to varying degrees, by other major donors. Britain and Germany, whose combined aid to sub-Saharan Africa totaled $2.5 bn in 1996-97, have also been urging African governments to eradicate corruption or face cuts in aid. France, which in 1996-97 gave more than $2.6 bn (making it the biggest single donor to sub-Saharan Africa), recently said it was overhauling its bilateral aid to make it more efficient and transparent. Less than two months after the announcement by Ambassador Bushnell, Mr. Jelte van Wiueren, the cultural attache in the Dutch embassy in Nairobi, Kenya, told journalists that his government, which spent $835 mn in development assistance to sub-Saharan Africa in 1996-97, will also decrease direct aid to governments and give more to NGOs.

According to the World Bank, 12 per cent of foreign aid to developing countries already was being channeled through NGOs in 1994, and as of 1996, the total amount was $7 bn worldwide. Today, NGOs in Africa manage nearly $3.5 bn in external aid, compared to under $1 bn in 1990.

Overall aid pie shrinks

This increasing shift of aid to NGOs comes at a time when total official development assistance (ODA) to the continent has been declining. Between 1993 and 1997, total aid receipts in Africa fell by nearly 13 per cent, from $21.5 bn to $18.7 bn (see graph), and to sub-Saharan Africa by a similar proportion, from $17.3 bn to $15.1 bn.

Some critics therefore see the more vocal donor complaints about government corruption in Africa as at least a partial justification for simply cutting back on aid flows overall. They argue also that unbiased, hard facts on actual levels of corruption in African governments - the stated justification for dealing more with NGOs than governments - are simply not available. Moreover, they say, the donor focus on government corruption does not seem to take into account private sector fraud or the role of foreign companies in offering bribes, nor does it acknowledge the growing efforts by African governments to curb corruption.

Besides, the critics further argue that NGOs themselves are not above corruption. What would be more justified, they say, is greater cooperation between NGOs and governments in development efforts, rather than phasing out aid to governments. NGOs by themselves, they maintain, cannot effectively or efficiently develop countries.

NGOs' comparative advantage

Despite some shortcomings, NGOs nevertheless have a comparative advantage over governments in a number of areas of activity. Some of their greatest strengths lies in advocacy and participatory models of development that focus on human development. They are very effective in demonstrating that poverty, no matter how endemic, can be tackled by involving project beneficiaries in planning, implementation and sustainability of projects. In a 1997 working paper, the UN Industrial Development Organization (UNIDO) summarized NGOs' comparative advantage as follows:

  • Local accountability
  • Independent assessment of issues and problems
  • Expertise and advice
  • Reaching important constituencies
  • Provision and dissemination of information
  • Awareness-raising

    According to the UNIDO paper, the strength of NGOs lies in their "proximity to their members or clients, their flexibility and the high degree of people's involvement and participation in their activities, which leads to strong commitments, appropriateness of solutions and high acceptance of decisions implemented." In effect, many donors view NGOs as an important part of Africa's democratization process, acting as watchdogs and advocates for human rights and good governance.

    NGOs often tackle issues that governments are unable or unwilling to take up. They provide efficient, innovative and cost-effective approaches to difficult social and economic problems. In some cases, they provide leadership in producing and advocating public policy, and operate in spheres where government officials are constrained by bureaucratic or political considerations.

    The growing importance of NGOs is reflected in their relationship with the United Nations and its agencies. The number of NGOs granted consultative status by the Economic and Social Council - the central UN forum for discussing and formulating policy recommendations on social and economic issues - has grown from 41 in 1948 to over 1,350 today. Virtually every UN agency works with NGOS. The UN High Commissioner for Refugees, for example, has some 400-500 NGO partners and in 1997 provided $272 mn in funding through 443 NGOs in 131 countries. The World Bank also has a portfolio of projects approved each fiscal year in which NGOs are involved.

    Indiscipline, fragility and dependence

    But some African governments remain critical of certain NGOs. The Tanzanian government condemns what it terms "briefcase NGOS," saying it will not tolerate those set up to funnel public funds to private ends. President Daniel arap Moi recently warned that any NGO in Kenya found dabbling in politics would be de-registered, and accused some NGOs in the country of corruption and financial indiscipline. President Nelson Mandela of South Africa (where there are some 50,000 NGOs) last December criticized what he called "illegitimate NGOs" trying to subvert the government.

    NGOs do in fact have their own weaknesses. Many are fragile and tend to depend excessively on external financing, making them at times unsustainable or liable to manipulation. In a recent investigative study, Kenya's Sunday Nation newspaper found that in Kenya alone, an average of 240 new NGOs are being formed each year, competing for $1.2 bn in annual donor funding. A number operate as "pocket NGOs" with no known offices. Others function as family business concerns, largely employing members of the same family.

    Sometimes NGOs are set up to meet donor needs and programmes. For instance, due to the recent donor emphasis on good governance and democratization, several NGOs have been registered around Africa to deal with civic education issues. This has led to accusations that some NGOs are primarily concerned with making money and not eradicating poverty, and will appear and disappear depending on where the money is. Earlier, a similar trend occurred with the mushrooming of NGOs dealing with environmental and women's empowerment issues, since these were the hot topics among donors at the time.

    Some critics also have argued that if NGOs control too much donor money, they may "crowd out" governments by drawing away personnel through better salaries and benefits. The average salary of a middle-level NGO worker in Africa is usually in the range of $1,500 to $2,000 a month, while a civil servant will be lucky to draw a fifth of that. Draining human resources away from governments will only result in further worsening their effectiveness and leaving them staffed with poorly trained and motivated personnel - the very thing that donors are trying to avoid.

    South African Minister for Public Works Jeff Radebe recently warned that having NGOs shoulders most national development programmes may interfere with national planning. He said NGOs tend to pursue their own agenda or that of donors, which may result in possible overlapping and duplication of NGO activities.

    In a recent article, Mr. Fareed Zakaria, the managing editor of the New York-based Foreign Affairs magazine, expressed concern that NGOs often lack accountability. But Ms. Barbara Ainsworth, president of Global Homes, a US-based NGO that specializes in helping the homeless, says that while there may be a few rotten eggs among them, NGOs have done a better job overall than governments in providing services. "There is just no comparison between us [NGOs] and most governments. We are changing lives out there," she says.

    Valuable partners

    On the whole, however, NGOs are considered valuable development partners. The Organization of African Unity has recognized the role they play in Africa's development and is looking for ways to support them.

    However, channeling most donor funds through NGOs at the expense of African governments creates problems. "There are certain things that NGOs cannot do," says Mi. Philip Nyang'iro, a political science lecturer at the University of Nairobi. "There was a case where an NGO was given funds to train farmers to become better coffee producers. A lot of funds were allocated to the project and as a result, the yields were very promising. But the farmers had no way of taking their coffee to the factory because there were no roads. NGOs do not build roads. It is the work of the government. You cannot ignore the government'."

    Mr. Paul Streetan, a scholar specializing in NGOs, also stresses that it is not possible to ignore governments, since most government policies have an impact on the work of NGOs. An NGO project, for instance, will easily flounder due to an overvalued exchange rate or a bias in policies that favour urban over rural areas. There is thus a strong case, he says, for NGOs and governments to work together.

    One such partnership success story is the population programme in Kenya managed by the National Council for Population and Development (NCPD), a government department. NCPD coordinates government and NGO-run family planning projects with the NGOs providing information, education and contraceptives - things that the NGOs are better able to do because of their rural base, experience and institutional capacity. In Uganda, AIDS organizations also have successfully worked with the Ministry of Health to fight the AIDS scourge and have succeeded in cutting down the rate of HIV infection significantly.

    Owing to their grassroots approach, NGOs are likely to better understand people's expectations and needs. At the same time, despite what some donor officials seem to think, governments, with their extensive resources and national scope, cannot be pushed to the periphery.


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