Importance Of Foreign Aid

2364 Words10 Pages
Foreign aid is often regarded as a means to help the poor and undeveloped nations. Foreign aid is can often be called as official development assistance. The notion of foreign aid can be understood as the transfer of money, goods or technical knowledge, from the developed to developing nations. Aids or Assistance can come in numerous forms such as humanitarian, emergency assistance, food, military and so on. In some cases foreign aid, has rewarded a great share and helping people in need around the world. Aid is motivated for military, political, economic commercial or humanitarian proposes. Foreign aid is usually used as an instrument of promoting and developing a nation to gain sustainability and growth. Moreover, foreign aid mainly aims in helping people in social, economic, and political aspects of various nations. A country receiving foreign aid helps in the overall establishment provided if it’s used properly.
The main reason why most developing countries clearly seeks and accepts foreign aid is for the purpose of improvement of their economic status. The foreign aid they receive helps them improve in the investment sector, encourage free enterprise, as well as gives them the ability to participate in the international trade, and enables them to develop infrastructures and supplement the lack of domestic resource such as foreign exchange. It can also encourage human capital, which is “ the knowledge and skills that workers acquire through education, training, and experience” (Mankiw, 542). Hence, economic aid, production sectors, infrastructure, contributes to an economic growth by increasing domestic investment, stimulating and helping to improve economies.
In the eyes of the world community foreign aid can be an importa...

... middle of paper ... believe that foreign aid does more harm than good. Unlike his counterparts Jeffery Sachs who strongly believe foreign aid is effective and can lead to a path of sustainability and growth.
When seeing both sides of the argument if whether or not foreign aid is beneficial for African countries, we can see strong and weak parts. In the case of seeing the advantages of foreign aid we can some what see that giving more money to devolving nation leads to dependency and causing problem mainly corruption. Same goes for Easterly that he should also realize that more money in fact may help the poor and escape poverty trap. Overall, aid coming through in any forms foreign aid lenders should mandate reform and requirements to take out loans. Finally, nation’s government should be hold check and balances and accountability so that the aid is dispersed to countries needs.
Open Document