The modern era has been going through a poverty global crisis. As time goes by, the number of people living in poverty has been increasing tremendously. In fact, the world has a total population of six billion people, where one billion people are surviving on less than one dollar each day. (Sachs, 2005, p. 20) The countries in the North are the ones who are less affected by this issue; however, poverty in the global South continues to grow. Individuals in developing countries suffer from a number of diseases such as malnutrition, HIV, malaria, anemia, tuberculosis and so forth. Moreover, this nations lack health care, education and stable jobs. According to UNICEF, “22, 000 children die each day due to poverty. “ As long as there is no effective solution, this cycle will keep growing and future generations will also be affected.
Unfortunately, the solutions proposed to fight poverty, such as foreign aid, have been more detrimental than beneficial to developing countries.
The intention of foreign aid is to foster a country’s human rights, democracy and enhance security by fighting poverty in order to establish a world of welfare ( UofT). Foreign aid has become more prevalent in recent years; however, is often corrupted and mismanaged by recipient governments, more specifically, governments in developing nations. It is important to understand the different types of foreign aid in order to evaluate the effectiveness of foreign aid. There are three main types of aid, humanitarian and emergency aid, charity- based aid, and systematic aid (Moyo, 2009, p. 7) Emergency aid is supplied in the occurrence of a natural disaster. In addition, organizations such as World Vision and OxFam distribute charity-based aid. In this paper we will focus on the third type of aid, systematic aid. Systematic aid includes multilateral and bilateral aid, and is made in form of payments. Transfers from a government to another government refer to multilateral aid, and bilateral aid is paid from an institution to a government. Bilateral aid has played a prominent role in the development of the global South. … Although developed countries have spent enormous amounts of money in providing aid to third world countries, the results obtained have not been as favourable as expected.
The long lasting debates about foreign aid have concluded that, “the volume of aid is declining” and it is currently at “its lowest level ever.” (Stiglitz) The numerous studies regarding foreign aid, have contributed to a variety of solutions and different viewpoints on the issue. The purpose of this paper is to address the effect on the relationship between foreign aid and development. Findings indicate that despite the factors that have impeded growth, foreign aid can foster some development without corruption grounded in two ideas: (1) good governance (in recipient country) (2) presence of sound economic policy and rightful institutions.
Theoretically, development assistance should...