Saturday, March 22, 2014

Oxfam Report Explains Foreign Aid in Simple Terms

On Wednesday, April 6, Oxfam America is planning a big event on Capitol Hill: the release of its updated version of its Foreign Aid 101 report. The report will be released at a reception co-hosted by Rep. Adam Smith, a Democrat from Washington state, who is also co-chair of the Congressional Caucus for Effective Foreign Assistance

The report is an effort by Oxfam  to dispel the common myths around foreign aid and answer some of the most fundamental questions as to why the US gives foreign aid and how to make it more effective. Oxfam is one the organizations partnering with Bread for the World to reform food aid, which is the subject of our 2014 Offering of Letters.

The third edition of the report, entitled Foreign aid 101: A quick and easy guide to understanding US foreign aid, provides answers by posing five simple questions:
  • Why does the US give foreign aid?
  • How much does foreign aid cost?
  • What is the us doing to make foreign aid more effective?
  • How can us foreign aid better fight poverty?
  • Why does Oxfam care about foreign aid?

The report is straightforward, well organized and contains very useful information and charts.  Download Foreign aid 101, Third edition
One useful feature is a section on Myths and Facts. Here is one example.

Myth: Development aid is just wasted by corrupt governments.
Fact: Foreign aid can push governments to do the right thing. USAID has tools in place to address specific capacity gaps in country systems and minimize the risk of fraud and abuse. Experience shows that US agencies provide assistance in ways that can:
  • Serve as an incentive for improved management of public revenues
  • Strengthen checks and balances and be a deter rent to corruption
  • Assist governments to end aid dependency
  • Increase accountability to both local people and taxpayers
Additionally, one US agency, the MCC, works only with the highest-performing governments, based on their performance on a set of indicators, including transparency and anticorruption efforts. Qualifying for MCC funding has created an incentive for some governments to improve, sometimes referred to as the “MCC effect.:" 

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