Sensible new approaches to aid

By subsidising poor countries’ national budgets or the budgets of their line ministries (for instance, those in charge of health care), OECD members are adopting a new approach to development assistance. According to the German Development Institute (GDI), some of the anticipated benefits are already materialising. Wide-ranging policy dialogue, for instance, is becoming normal. More donors are participating, and they discuss comprehensive poverty-reduction strategies, instead of merely economic and financial policy. According to this publication, however, it is unclear whether “budget support” does in fact take pressure off the administrations of poor countries. Moreover, it is linked to conditions, and may thus thwart intentions of making authorities more accountable to the citizens. The researchers do believe, however, that the donors are basically on the right track. (bl)