In the wake of the cyclones that ravaged parts of Africa between March and April this year, the World Bank, after extending some US$700 million in grants to Mozambique, Zimbabwe and Malawi – the countries that bore the brunt of the damage – announced that it would also boost lending to help fight poverty.
World Bank President David Malpass, US President Donald Trump’s controversial pick for the job, who took up the position early last month, made the loans announcement last week after visiting three sub-Saharan African countries – Madagascar, Ethiopia and Mozambique. While no figures were given, Mr Malpass did say that the aim was poverty reduction. His announcement was in tune with statements he made after taking up the post, declaring that the World Bank’s mission was alleviating and eliminating extreme poverty. Mr Malpass also acknowledged that climate change had an impact on poverty in developing nations.
Since the African continent has some of the poorest countries in the world, it boggles the mind as to how, if ever, they would be able to repay loans. It does seem to be a sort of vicious cycle that may very well have the opposite effect. Malawi, for example, is the third poorest country in Africa. It held that status before it was hit by serious flooding from Cyclone Idai and was dependent on development aid. Malawi is one of the countries that was ravaged by HIV and AIDS and its education and health care systems desperately needed to be boosted. Add the facts that the country suffered massive deforestation and was plagued with both poor infrastructure and a high corruption rate and you get the picture.
Meanwhile, there has been a drop in overseas development aid from rich countries to poor ones. Data produced by the Organisation for Economic Cooperation and Development (OECD) showed that bilateral aid to least-developed countries fell by 3% in real terms from 2017, aid to Africa fell by 4%, and humanitarian aid fell by 8%. The OECD said it was worrying as just two years prior countries had pledged to ramp up development financing towards achieving the 2030 Sustainable Development Goals (SDG)s, the first one of which was no poverty by 2030. The so-called shared blueprint for peace and prosperity for people and the planet, now and into the future also targets zero hunger, health, education, gender equality and climate action among others – there are 17 goals in total.
According to Reuters, only five of the 30 major donors who make up the OECD’s Development Assistance Committee – Denmark, Luxembourg, Norway, Sweden and Britain – met the UN’s target of spending 0.7 percent of national income on development aid last year. And just last month, the US President proposed a 23 percent cut in the budget for foreign aid, which, if it passes, could see a further decline this year.
Smack in the middle of all this are the philanthropists – billionaires like Warren Buffet, Bill and Melinda Gates, Michael Bloomberg and Denise Coates – who consistently give to charitable causes but demand accountability and results from governments and non governmental organisations, recognising that corruption has caused aid projects to fail. Because of this, much of what billionaires financed has made a difference, among them the vaccination, infant mortality and malaria projects in Africa, funded by the Bill and Melinda Gates Foundation.
In 2010, Mr Buffet and Mr Gates had set up “The Giving Pledge”, which asked rich people to donate half their wealth to philanthropic causes. Only 6 of the world’s wealthiest signed on and so far, only Mr Buffet has met and surpassed that marker, though Mr Gates is not that far behind.
Professor Jeffrey Sachs of the Center for Sustainable Development at Columbia University has been saying since before 2005 that poverty persists not because it is impossible to end it but because of greed. He believes that it is possible to spend down poverty, but only if more rich countries and people give away some of the excess they possess. Altruism is a hard sell. Many don’t give because they can’t see a way to benefit from it – like instant stardom or some sort of never-ending halo. However, with the global tech sector still booming and more joining the billionaire list every year, perhaps there is still a chance for some of the SDGs to be reached even if in a different way.